On Monday, Mad Money host and former fund manager Jim Cramer stated that he feels the recent market volatility and general downward movement due to fears over the debt ceiling issue has created several opportunities to step in and buy individual equities. In particular, he noted that several equities announced excellent news last week, but that the debt ceiling noise overshadowed that news.
Cramer noted that Starbucks Corp. (SBUX) announced 30% same-store sales growth in China, but that this news did not move the stock up. Starbucks also provides a 1.3% dividend. On July 12, Starbucks also raised prices on bagged coffee for sale at its U.S. locations an average of 17% due to rising coffee costs.
Cramer also suggested that Deckers Outdoor Corp. (DECK) may be a good investment here and now. Though the stock performed well recently and moved up about 25% through July, from about 80 to 100, Cramer stated that the strength of Deckers brands such as Teva and UGGs should push the stock up another 20%. Cramer compared DECK with VF Corp. (VFC), which also performed well through July on the strength of its apparel brands and lower commodity costs.
Cramer further commented that Annaly Capital Management, Inc. (NLY) continues to be a recommendation of his. He noted that it performed well Monday, on the heels of a debt ceiling deal and also a strong quarterly report. Cramer also stated that he believes Michael Farrell, who runs NLY, got capital at just the right time in advance of the recent volatility, showing Annaly's understanding of the market.
Cramer noted that Chesapeake Energy Corporation (CHK) announced some excellent news last week, but that the stock hardly moved on the announcement. In particular, Cramer was speaking of an announcement that the Utica shale below the Marcellus shale, in Ohio, appears to be a substantial find, and that CHK owns a significant amount of acreage there. Aubrey McClendon, CEO of Chesapeake, spoke on the show and stated that testing and present drilling of Utica shale indicates it could have the most lucrative petroleum mix yet identified within the various shale fracking locations.
Cramer says that these equities should have moved up last week on the strength of their fundamentals, but that the debt ceiling fears kept them from moving upward. If this is true, these equities may outperform the broader market on any rally, following what appears to be an imminent debt ceiling solution.
Disclosure: I am long NLY.
Disclaimer: This article is intended to be informative and should not be construed as personalized advice as it does not take into account your specific situation or objectives.