Special Guest: New York Giant's kicker Jay Feely
Jay Feely is the "financial adviser" for the New York Giants and considers it a "blessing" that he had the opportunity to manage people's money before joining the NFL. Since many of his fellow players are too busy to follow stocks closely, Feely recommends making the most of their 401(k)s, diversifying their portfolios and keeping a balance of speculative and blue-chip stocks. "I have my bedrock and try to invest in mutual funds, but I also try to invest in small-cap stocks," Feely said. Cramer applauded Feely's strategy of taking out his cost basis and letting the rest run when his stocks go up and his advice that investors should start young and be disciplined. After talking finance, the two headed outside so Feely could teach Cramer how to place-hold a ball for him to kick.
Nobody's Perfect: NYSE (NYX)
Cramer admits that he made a mistake by making bearish comments on NYX as recently as last Monday. "I was wrong when I said it wasn't a buy at $57, and I would be wrong if I didn't say it was a buy at $71," he confessed. The mistake, according to Cramer, was his in judging the stock according to where it had been rather than where it was headed, the belief that the positives were already in the stock and that NYX would not be able to compete. "It's a sign you're wrong when you agree with the rest of the Street," he said. NYX reduced costs by going electronic, saw a revenue growth of 10% in the past year, and in spite of what Cramer initially believed, did not pay too much for Euronext. Cramer suggests buying some now and picking up the rest when the deal with Euronext goes through.
Related: Mark Mahorney explains why he is long-term bullish on the exchanges.
Although he proved that he is able to admit a mistake Cramer told a caller that he did not regret choosing LVLT over CCOI because he is certain that LVLT will go up higher even though the two companies' stock charts look alike and that both will benefit from a bandwidth shortage. "Cogent is a roll-up of bad properties," Cramer said. "They issue stock to buy a lot of things." In addition, CCOI is a second-tier network which will suffer if shareholders take profits and is a hated stock without much upside. Cramer likes Level 3 because it is a one-tier company, a good long-term play, is getting rid of debt and has "the best management in the industry." He believes the stock could double in 18 months.
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