Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Monday December 16.
The Dow surged 129 points, and Cramer thinks it might have finished even higher if it weren't for the worries about the Fed meeting Wednesday. One thing driving up stocks is the shortage of shares of certain companies. Exxon (XOM) rose $3 on Monday, only to drop back. It is showing decent growth for the first time in years, and expects a 5% increase in production. Cramer noted that oils trade on production growth and not on earnings per share. Warren Buffett's increased stake is also a reason why the stock is going higher. Goldman Sachs' upgrade was apt, but an afterthought.
There are not enough shares of Twitter (TWTR), Facebook (FB), Netflix (NFLX), Google (GOOG) and Amazon (AMZN) to go around. Netflix trades on subscriptions, and Amazon trades on its sales rather than earnings per share. Demand for these stocks is huge, and short sellers are making a sucker's bet.
Cramer took a call:
Cramer discussed 2 stocks that make great "stock"ing stuffers that should see gains in 2014. General Electric (GE) has been plagued by its faltering financial segment, but GE's management is wisely spinning off the segment and concentrating on its traditional industrial business. The aviation and oil and gas divisions are growing, and GE saw a 13% rise in earnings with a huge backlog of business. The company should see revenue growth and boosted its dividend by 16%.
Johnson Controls (JCI) is a likely breakup candidate which is benefiting from rising auto sales and construction. It has a building efficiency business, an auto parts segment, an HVAC division and also sells car and truck batteries. JCI has an analyst day on Thursday, and Cramer wants to hear if it will sign off at least one of its divisions. The company recently beat estimates, raised guidance and increased the dividend. Its multiple is just 15.3 compared to its 15% growth rate.
Cramer took some calls:
Textron (TXT) lacks the fundamentals to buy as a takeover target.
Cheniere Energy Partners (CQH) was much lower at its IPO. Cramer wants to talk to the CEO on Mad Money before he can opine on CQH.
Himax (HIMX) is "one of the most blessed techs."
CEO Interview: Joseph Papa, Perrigo (PRGO)
Perrigo (PRGO) is "the king of private label," and delivers higher margins for retailers with its product. The company is acquiring Irish drug company, Elan, and is moving many of its operations to Ireland, where taxes are lower. The stock has run 41% for the year and has risen 23% since Cramer last spoke to CEO Joseph Papa in August. At that time, PRGO's stock had fallen because many on the street didn't seem to understand how its merger with Elan would benefit the company. Papa thinks that cost savings and the contributions Elan will make will be accretive to PRGO's earnings in the near future. PRGO benefits from the trend of shoppers of any income wanting to save money, and Papa noted that 91% of consumers who switch to private label don't switch back."I am high on this stock," said Cramer, "and if it gets hit, just buy it."
I am high on this stock; if it gets hit again just buy it.
Get Cramer's Picks by email - it's free and takes only a few seconds to sign up.