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Jim Cramer is one of the most reputable and joyful stock pickers in the Street. He keeps seeking the most profitable and safe stocks to help you protect your money. He recently mentioned great companies like Coca-Cola (KO) and Conoco Phillips (COP), along with his other bullish calls. I have investigated these stocks from a fundamental perspective, adding my O-Metrix Grading System where necessary. Here is a fundamental analysis of these stocks from Cramer's Mad Money:

Stock Name


Cramer's Suggestion

O-Metrix Score

My Take





TJX Companies




Long-term Buy



Top Pick



Conoco Phillips


Top Pick


Top Pick

The Coca-Cola Co.




Buy on Dip

Salesforce is one of the few tech stocks that Cramer is bullish on. The company shows a trailing P/E ratio of 333.3, and a forward P/E ratio of 68.0, as of Aug 19. Analysts expect the company to have a 25.1% annual EPS growth in the next five years. Profit margin is 2.7%, which is crushed by the industry average of 12.0%. Salesforce has no dividend policy.

Earnings decreased by 97.20% this quarter, and 25.09% this year. SMA50 is -22.74%, while SMA200 is -18.89%. The company has a razor thin O-Metrix score of 0.62, and it is trading 30.68% lower than its 52-week high. Target price indicates a 47.7% upside potential, while it returned 15.1% in a year. Debts are increasing since 2009. P/S is 8.9 and P/B is 12.2, both of which are way above industry averages.

ROA and ROE are 1.68% and 3.95%, respectively. Insiders have been exercising options and selling stocks for a while, and the stock is highly volatile. PEG value is 2.4. Moreover, it has a one-star rating from Morningstar. I see no reason to invest a penny in Salesforce for now.

Cramer recommends TJX Co. instead of Urban Outfitters, as Urban has “lost its step.” The Massachusetts-based TJX was trading at a P/E ratio of 16.7, and a forward P/E ratio of 12.3, as of the Friday close. Estimated annualized EPS growth for the next five years is 13.9%, which sounds reasonable when its 18.46% EPS growth of past five years is considered. With a profit margin of 5.8%, TJX offered a 1.44% dividend last year.

Earnings decreased by 15.60% this quarter. O-Metrix score of the stock is 5.28, while it is currently trading only 6.56% lower than its 52-week high. Target price is $59.89, which implies an about 13.2% upside movement potential. ROA is 16.24%, whereas ROE is 41.46%. TJX returned 26.0% in the last twelve months, and debt-to assets ratio is slightly going down since 2007. P/B is 6.5, way higher than the industry average of 3.1. This stock might be a good long-term buy after a pullback.

Cramer thinks that BP and Conoco Phillips are great picks for the time being. Here is a brief comparison between these two companies:

Current as of August 19 Close.


Conoco Phillips

P/E ratio



Forward P/E ratio



Estimated EPS growth for the next 5 years



Dividend yield



Profit margin



Gross margin



Upside movement potential



O-Metrix scores for BP and Conoco Phillips are 8.24 and 7.94, respectively. BP is trading 20.14% lower than its 52-week high, while Conoco Phillips is trading 20.85% lower. BP returned 6.1% in the last twelve months, whereas Conoco Phillips returned 16.2%. Both of the companies have their debt-to assets ratios at 20%s.

BP cut its dividends by half in Feb 2011, whereas Conoco Phillips’ dividends are perfectly stable for all of its history. Conoco Phillips has a five-star rating from Morningstar, and it recently multiple topped. On the other hand, BP is slightly better in terms of P/E- forward P/E ratios, O-Metrix score, dividend yield, profit margin, and upside potential. Both companies are excellent picks for a profitable portfolio.

Cramer believes that Coca-Cola is a great buy at this price, as it is down about $1.50. The Georgia-based beverage titan shows a trailing P/E ratio of 12.54, and a forward P/E ratio of 16.1, as of Friday’s close. Analysts expect the company to have an 8.0% annualized EPS growth for the next five years. With an impressive profit margin of 29.7%, shareholders enjoyed a 2.80% dividend.

O-Metrix score for the company is 3.77, while it is currently trading only 3.90% lower than its 52-week high. Earnings increased by 46.48% this quarter, and 72.75% this year. The company returned 21.3% in the last twelve months, whereas debt-to assets ratio is climbing up since 2006. Target price is $76.54, indicating a 14% increase potential. While ROE is 41.29%, ROA is 19.49%. Gross margin is 61.7%. Debt-to equity ratio is 0.3, way below the industry average of 1.1. Coca Cola is a dividend pick for the next 5 years (click here for my full analysis of KO). However, I would wait for a pullback.

Find more information on O-Metrix Grading System here.

Data obtained from Finviz/Morningstar and current as of August 19th

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