Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Tuesday November 21. Click on a stock ticker for more analysis:
Since it's the time of year for toys, Cramer discussed Mattel and Hasbro, and ruled out owning both stocks for the sake of diversification. Although Mattel has steady gross margins and a strong buyback strategy, Cramer would rather own HAS because he thinks its toys are better. Although he doesn't think that the recall of Polly Pocket will hurt the company and notes the success of American Girl, Cramer thinks all Mattel can do is a rehash of Elmo or Barbie, while Hasbro's Transformers are the inspiration for a film that should be a blockbuster, and Hasbro has recently made a deal with Marvel Comics to create a line of Spiderman toys. Cramer adds that board games are back and expects a big turnaround for Hasbro.
Related: Minyanville is not impressed with Mattel's American Girl stores.
When a company is beset with an options backdating scandal, letting go of the CEO bodes well for the stock, says Cramer. This is what happened with KB Home, which produced a 10% profit in only two days. There is still time to cash in on Cyberonics, which is "ready to run" as CEO Skip Cummins walks away. Cramer thinks that Cyberonics' involvement in such a scandal is a sign that the CEO knew that there was going to be an upside down the line. Also, the CEO was weighing down the stock for a long time and was bad for the company. Cramer thinks Medtronic may acquire CYBX, but if not, the stock is too high. However, he would buy CYBX when it goes down.
Related: Shares of Cyberonics went up on the news of CEO Skip Cummins' departure.
CEO Interview: Terry Lungren, Federated Department Stores (FD)
When Cramer asked Terry Lungren about FD's merger with May Department Stores, Lungren responded that although it is earlier than expected, everything is on track. Responding to Cramer's question of how to encourage customers to buy even when there isn't a sale, Lungren said that FD has the strategy of offering better value more frequently. Shoppers do not have to think twice about going shopping when they know that they are going to find good values without the gimmicks. Cramer commented that FD is about to move and is a "triple buy."
Related: Lon Juricic reports that Carl Icahn is increasing his position in FD.
In spite of options-backdating headaches and disappointing revenues, BEA Systems is a buy, according to Cramer, because it has strong exposure to China even though this isn't yet reflected in its numbers. Cramer criticizes analysts who carried out the double downgrade of BEAS because they scared investors off of a good stock. The end of the options investigation in three weeks should be a catalyst to propel BEAS, says Cramer, as with RACK and NTAP, which are heading higher. BEAS was softer than expected and raised estimates, and Cramer notes that it is at the cutting edge of technology and IBM is not a threat. Cramer thinks BEAS could be taken over since it declined 15% . Finally, BEAS has an abundance of cash and is a buy for the long-term.
Related: Kris Tuttle takes another look at BEAS.
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