Jim Cramer is one of the top watched TV personalities on CNBC. He is the host of Mad Money and also the co-founder and chairman of TheStreet.com. Nearly two hundred fifty thousand people watch his show daily on TV and most of these are ordinary investors trying to understand what’s going on in the market. Jim Cramer’s bullish and bearish stock picks on his show is the starting point for many investments made by these folks.
During the August 23rd show, Cramer discussed the following stocks.
Deere (DE): Cramer recommended this best-of- breed tractor maker on the idea that farmers will spend more money on equipment to try and get more crops out of the same acreage. Cramer said this stock should be bought into weakness and could provide multiple years of growth. Deere is trading at 11 times earnings and yields 2.25%.
Potash (POT): Playing the theme of a global food shortage, Cramer recommended the best of the fertilizer companies under the assumption that a rising middle class around the world will increase the demand for chickens, cows, etc. which all feed on grain. Cramer recommended buying on a pullback. Mohnish Pabrai has a large position in the stock (see more of Pabrai’s picks here).
Heckmann Corporation (HEK): A speculative play could be made with, according to Cramer, as people around the country are seeking to lead healthier lives through actions like filtering water. Although Aqua America (WTR) had a good move recently, Cramer would still pick Heckmann.
Waste Management (WM): Cramer said Waste Management is the best play in its sector, and gave it a buy recommendation. CEO David Steiner “pumps money to shareholders” and the stock currently yields 4.2%.
Honeywell (HON), Emerson Electric (EMR) and Eaton Corp (ETN) are Cramer’s favorite ways to play the energy shortage, as all of these company’s manufacture machines and systems that allow other companies to save money on their energy costs. Cramer warned that these are cyclical businesses that do well when the economy heats up and poorly when it cools down. He sees these as long-term, multi-year performers.
Polypore International (PPO): Cramer recommended this energy and battery company when a viewer asked about how to play lithium stocks in this energy shortage. Richard Driehaus of Driehaus Capital increased his position in PPO by 51% during the first quarter (see more of Driehaus’ holdings).
American Science and Engineering (ASEI): This company works within the prevention and protection area of homeland security, and produces X-ray scanners (in a variety of formats). Cramer gives this stock a buy recommendation, but only when it goes lower in order to get a good entry point. ASEI currently trades at 13 times earnings and yields 1.875%
Verint Systems (VRNT): This cyber-security company helps protect the increasingly sensitive information that is finding its way online. The stock trades at 33 times earnings.
NICE-Systems Limited (NICE): This Israeli company develops high-quality analytic software for surveillance purposes as well as other network and security functions. Cramer said this stock is less speculative than (VRNT) and (ASEI). Mark Nordlicht’s Platinum Management has 4.75% of its 13F portfolio in NICE-Systems (see more of Nordlicht’s stocks).
Whole Foods (WFM): Ultimate high-end supermarket because of the good-for-you products offered. It can maintain higher price points without losing business. The stock has an EPS of 1.85 and yields less than 1%.
Panera Bread (PNRA): Panera has become the place to get all-around healthy, high quality food. People feel they can come here and lose weight without losing taste. Ron Gutfleish of Elm Ridge Capital has a large position in PNRA.
Hain Celestial (HAIN): Makes organic foods and other products that promote general well-being. Cramer said the healthy eating trend is not going away, and HAIN is poised to benefit from it. The stock trades at 25 times earnings, but Cramer said it’s justified because of the price consumers are willing to pay to get these products. This is one of Carl Icahn’s longer term stock picks.
Chipotle (CMG): Cramer likes this healthy, fast-food concept because of its customer’s loyalty, which would allow it to raise prices if it needed to. This loyalty has been developed by consistently delivering the highest-quality food that is good for both consumers and the environment. Cramer gives it a buy recommendation, but not if it means paying-up for it.
Goldcorp (GG), the lowest-cost producer, and Barrick Gold Corporation (ABX), the largest gold producer on Earth, are the miners Cramer recommends buying if you’re looking to own something more than SPDR Gold Trust ETF (GLD). This is the second time this week Cramer recommended these two stocks and gold ETF.
International Tower Hill Mines (THM) and Nova Gold (NG) are two speculative plays, as they operate mines that are still in development. Cramer said owning these miners are like having a call option on gold.
iShares Silver Trust ETF (SLV): Silver is on the rise, and Cramer thinks it is poised to go higher. He recommends buying this ETF over Pan American Silver (PAAS). Peter Palmedo of Sun Valley Gold has a 2.6% position in the ETF (see more of Palmedo’s holdings).
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.