14 Cramer Buy Recommendations - A Review

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Includes: A, AAPL, AMZN, APA, FCX, HD, M, MHS, NRG, OCLR, TJX, VIAV, WBA, WFM
by: Investment Underground

By Roger Choudhury, Lead Editor

Here we review the February 22nd buy recommendations of Jim Cramer, host of Mad Money on CNBC. Since then, for comparison purposes, the S&P 500 is down 3.31% and the Dow Jones is down 2.85%.

Macy’s (NYSE:M) is down only 1.4% since February 22. Its most recent fiscal year ended this January, and it produced $1.98 in EPS, which was an increase of 153.8%, after posting - $11.40 in FY 2009 and $0.83 in FY 2010.

For this year, the Street expects proforma EPS to be between $2.25-$2.40, compared to proforma EPS of $2.09 in this most recent fiscal year. The next earnings release is on May 12. Expectations are between $0.10 and $0.17 per share for proforma EPS. For the same period in the previous fiscal year, it was $0.05 per share.

In February 2011, same store sales were up 5.8%, compared to the same 4 week period in 2010.

Macy’s shares trade with a P/S multiple of 0.4. In 2006, that figure was 0.8.

TJX (NYSE:TJX): - 1.6% since February 22. In FY 2011 through January, the company made $3.30 in GAAP EPS, which was an increase of 16.1%, after growing by 36.5% in FY 2010. Net sales also grew by 8.1% in FY 2011, after +6.78% in FY 2010.

For FY 2012, the Street expects proforma EPS to come in between $3.60 and $3.95. The company expects it to be between $3.78 and $3.93. Proforma EPS in FY 2011 was $3.50. The next earnings release is scheduled for May 17, with analysts expecting between $0.78 and $0.84 in proforma EPS. In Q1 2011, proforma EPS was $0.80.

TJX shares trade with a P/S of 0.9. This is the second highest P/S since 2001.

Whole Foods (WFMI) is up 2.8% since February 22. In FY 2010 through September, the company made $1.43 in GAAP EPS, which was an increase of 68.24%, after +3.66% in FY 2009. For Q1 2011, GAAP/proforma EPS was $0.51, compared to GAAP/proforma $0.32 in Q1 2010. For Q2 2011, proforma EPS is expected to come in between $0.40 and $0.51. In comparison, Q2 2010 produced $0.38 in proforma EPS. These earnings come out on May 9.

For the entire fiscal year of 2011, the Street expects from $1.70 to $1.90 for EPS.

WFMI shares trade with a P/S multiple of 1.1. From 2003 to 2007, the multiples were 1.3, 1.6, 2.2, 1.2, and 0.8, respectively.

Amazon.com (NASDAQ:AMZN) has dropped by 11.7% since February 22. In 2010, the company made $2.53 in EPS, which was an increase of 24.02%, after +36.91% in 2009. Analysts expect 2011 EPS to come in between $2.60 and $3.75.

The next earnings release is on April 22. Analysts expect Q1 2011 to produce EPS between $0.50 to $0.79. In comparison, Q1 2010 produced $0.66 in EPS.

These shares trade with a P/S multiple of 2.2. In 2007, that figure was 2.6.

Home Depot (NYSE:HD) is down 5.3% since February 22. In FY 2011 through January 2011, the company posted an EPS of $2.01, which was an increase of 29.7%, after increasing by 17.16% in FY 2009. The company expects EPS from continuing operations to be up 9.5% to $2.20, excluding the impact of future share repurchases.

Using excess cash, the company intends to repurchase approximately $2.5 billion of outstanding shares throughout the year. Proforma EPS in 2010 was $2.03, and analysts expect FY 2012 to produce proforma EPS between $2.22 and $2.37.

Q1 2011 earnings come out on May 17 with a range from $0.47 to $0.52 for proforma EPS. In comparison, Q1 2010 had a proforma EPS of $0.45.

HD shares have a P/S multiple of 0.9. From 2004 to 2007, the multiples were 1.3, 1.1, 0.9, and 0.6, respectively.

Walgreen (WAG) is down only 1.8%, since February 22. In FY 2010 through August, the company made $2.12 in GAAP EPS, which was an increase of 4.9%, after dropping 6.9% in FY 2009. Proforma EPS in 2010 was $2.17. In FY 2011, analysts expect between $2.55 and $2.74 for proforma EPS.

In Q1 2011, the company made $0.62 versus $0.49 in Q1 2010. On March 22, Q2 2011 earnings come out. The Street expects between $0.75 and $0.85 for proforma EPS. In comparison, Q2 2010 produced an EPS of $0.68.

WAG shares have a P/S multiple of 0.6. From 2003 to 2007, the multiples were 1.1, 1.0, 1.1, 0.9, and 0.7, respectively.

Freeport-McMoran Copper & Gold (NYSE:FCX) is down 1.0% since February 22. In 2010, the company produced a proforma EPS of $4.64, which was an increase of 54.1%, after rising to $3.01 in 2009 from $3.58 proforma and - $14.86 GAAP. In 2011, analysts expect proforma EPS to be between $4.90 and $6.93.

The next earnings release is on April 18. The Street expects Q1 2011 to produce proforma EPS between $1.05 and $1.44. In comparison, Q1 2010 proforma EPS was $1.02.

Company shares trade with a P/S of 5.2. Its highest performance in the 2000’s was in 2010 with a multiple of 6.0, and historically it traded with a multiple in the 2’s and 3’s. Moreover, the industry average is 3.7. Be wary.

Medco Health Solutions (NYSE:MHS) has fallen 19% since February 22. In 2010, the company produced GAAP EPS of $3.16, which was an increase of 21.07%, after +22.54% in 2009. The proforma EPS was $3.40 in 2010, and the Street expects that to be between $4.03 and $4.15 in 2011.

Q1 2011 results come out on April 28 with expectations between $0.85 and $0.92. In comparison, Q1 2010 produced proforma EPS of $0.73 and GAAP EPS of $0.67.

The price to sales multiple on MHS shares is 0.4. Its highest multiple was in 2007 with 0.6.

NRG Energy (NYSE:NRG): - 0.14% since February 22. In 2010, EPS fell by 46.5% to $1.84, after dropping by 20.71% in 2009. Analysts expect 2011 to be varied: they expect between $0.38 and $1.49.

Q1 2011 results are released on May 9. Analysts expect EPS to be between - $0.14 and $0.33. In comparison, Q1 2010 brought in an EPS of $0.22.

NRG shares trade with a P/S multiple of 0.6. From 2003 to 2007, the multiples were 2.1, 1.5, 1.6, 1.3, and 2.1, respectively. By this measure, NRG shares may be undervalued.

Oclaro (NASDAQ:OCLR) collapsed by 33.8% since February 22. In FY 2010 ending in June, the company made $0.26 in GAAP EPS, which was an increase from - $1.12 in FY 2009 and - $1.26 in FY 2008. Proforma EPS was $0.39 in FY 2010. In FY 2011, analysts expect proforma EPS to come in between $0.45 and $0.51.

Q1 and Q2 2011 produced proforma EPS of $0.06 and $0.12, respectively. In comparison, Q1 and Q2 2010 produced proforma EPS of $0.00 and $0.05. Q3 2011 proforma EPS is expected to come in between $0.10 and $0.12. In Q3 2010, proforma EPS was $0.08. The next earnings release is on April 25.

OCLR trades with a P/S of 1.1. The latest fiscal year produced a multiple of 1.4, which is the highest ever.

JDS Uniphase (JDSU) is down 23.1% since February 22. In FY 2010 through June, the company posted a GAAP EPS of - $0.17. In FY 2009 and FY 2008, those figures were - $4.02 and - $0.10, respectively. Proforma EPS in FY 2010 was $0.41. In FY 2011, analysts expect proforma EPS to be between $0.87 and $1.00.

Q1 and Q2 2011 produced proforma EPS of $0.20 and $0.29, respectively. In comparison, it was $0.04 and $0.12 in Q1 and Q2 2010, respectively.

For Q3 2011, assuming the company makes $440 million in revenues with an 11% operating margin, a conservative proforma EPS estimate would be $0.175. Juxtapose that with $0.10 for Q3 2010. Analysts expect between $0.17 and $0.24 in Q3 2011. Earnings results are released on May 2.

JDSU trades with a price to sales multiple of 2.7. From 2005 to 2007, the multiples were 3.8, 2.6, and 2.0, respectively.

Agilent Technologies (NYSE:A) has been flat since February 22. In FY 2010 through October, GAAP EPS was $1.94, after posting - $0.09 in FY 2009 and $1.87 in FY 2008. Proforma EPS in FY 2010 was $2.00. In FY 2011, the Street expects EPS to come in between $2.58 and $2.72.

Q1 2011 produced a proforma EPS of $0.60, after showing $0.38 in FY 2010. Q2 2011 expectations are between $0.64 and $0.66. In comparison, Q2 2010 proforma EPS was $0.43. The next earnings release is on May 10.

These shares trade with a P/S of 2.7. In 2005 and 2006, P/S was 3.2 and 3.1, respectively.

Apache (NYSE:APA) is up 4.2% since February 22. In 2010, the company produced a GAAP EPS of $8.46, after being in the red in 2009 with - $0.87, but in the green in 2008 with $2.09. Proforma EPS in 2010 was $8.92. Analysts expect proforma EPS in 2011 to be between $9.29 and $13.40.

Q1 2011 results are released on April 25. The Street expects Q1 2011 proforma EPS to between $2.06 and $3.15. In comparison, Q1 2010 proforma EPS was $2.10.

APA trades with a P/S of 3.6. From 2005 to 2009, those figures were 3.0, 2.7, 3.6, 2.0, and 4.0, respectively.

Apple (NASDAQ:AAPL) is down 3.2% since February 22. In FY 2010 through September, EPS was $15.15, which was an increase of 66.85%, after jumping by 69.40% in 2009. In 2011, analysts expect EPS to be between $20.41 and $24.17.

Q1 2011 has already produced an EPS of $6.43. In comparison, Q1 2010 had an EPS of $3.67. Analysts expect Q2 2011 to produce an EPS between $4.85 and $5.98, after posting $3.33 in Q2 2010. The next earnings release should come out on April 21.

Shares trade with a price to sales multiple of 4.0. From 2006 to 2008, the figures were 3.6, 6.7, and 2.3, respectively.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.