Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Tuesday September 6.
Top 4 Performing Stocks of the Last Five Years: Priceline (NASDAQ:PCLN), Questcor (NASDAQ:QCOR), Baidu (NASDAQ:BIDU), Green Mountain Coffee Roasters (NASDAQ:GMCR). Other stocks mentioned: Energy Products Partners (NYSE:EPD), Enbridge Energy (NYSE:EEP), Clearwire (CLWR), Las Vegas Sands (NYSE:LVS), Wynn Resorts (NASDAQ:WYNN), Sprint (NYSE:S)
1. Green Mountain Coffee Roasters (GMCR) has risen 3, 585% in the last 5 years with its revolutionary Keurig product. The company is expanding internationally, and the popularity of the Keurig shows no signs of waning.
2. Baidu (BIDU) is up 1,698% in the last 5 years, and Cramer reiterated that Baidu is the only Chinese stock he recommends.
3. Questcor (QCOR) has risen 1,576% in 5 years, and is benefiting from its specialty drug for MS.
4. Priceline (PCLN) has risen 1,475% in the last 5 years.
Cramer tooks some calls:
McDonald's (NYSE:MCD), Johnson & Johnson (NYSE:JNJ), Randgold (NASDAQ:GOLD), Goldcorp (NYSE:GG), International Paper (NYSE:IP), Temple-Inland (NYSE:TIN), Bank of America (NYSE:BAC), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Chipotle Mexican Grill (NYSE:CMG)
The bounce in the Dow on Tuesday after a huge decline in the morning shows that while the U.S. might not be as badly off as Europe, there is still reason to be cautious. With the current volatility, high yielders and recession-proof stocks like McDonald's (MCD) and Johnson & Johnson (JNJ) look attractive. High growth stocks like Apple (AAPL), Amazon (AMZN) and Chipotle (CMG) are heading higher.
Cramer's checklist of things that need to happen before there can be a true feeling of safety in stocks still is waiting for items to be crossed. There is a palpable lack of leadership, particularly in Europe. While banks seemed to be improving after Warren Buffett's investment in Bank of America (BAC), lawsuits over bad mortgages still plague the financial sector. Tech stocks will not be buyable for another two to three weeks. There are not enough mergers going on, but the deal between International Paper (IP) and Temple Inland (TIN) is a start. Stocks need to decline further to hit a bottom, and there need to be a few down days for gold. When this happens, Goldcorp (GG) and Randgold (GOLD) should be bought. Before the consumer can feel confident about prices at the pump, Brent crude needs to drop more in price. Chinese growth seems to be slowing, but inflation in the country is still increasing. The bottom line: while the bounce on Tuesday was good news, these bounces need to be sustainable before they can inspire confidence.
Top 4 Performing Stocks Since March, 2009: Dana (NYSE:DAN), Jazz Pharmaceuticals (NASDAQ:JAZZ), Pier One Imports (NYSE:PIR), Dollar Thrifty Automotive (NYSE:DTG). Other stocks mentioned: Tenneco (NYSE:TEN), TRW Automotive Holdings (NYSE:TRW), BioMarin Pharmaceuticals (NASDAQ:BMRN), Alexion (NASDAQ:ALXN), ZipCar (ZIP), Pharmasset (VRUS)
March of 2009 marked the bottom for stocks during the recession, and investors who bought the following stocks at that time would have seen huge gains. Cramer outlined the best performing stocks since the bottom in 2009.
1. Dollar Thrifty Automotive (DTG) is up 8,300% since March, 2009, and is currently a takeover target. Cramer also likes recent IPO ZipCar (ZIP) which reported a strong quarter, but has failed to see a boost in its stock price.
2. Pier One Imports (PIR) is up 7,702% since 2009 and should go higher, given its move into e-commerce.
3. Jazz Pharmaceuticals (JAZZ) has risen 6,600% since 2009 and is an example of how well a biotech speculative play can perform when it has a niche market. Jazz makes a narcolepsy drug, and faces little competition. Other "orphan drug" stocks worth taking a look at are BioMarin (BMRN), Alexion (ALXN) and Pharmasset (VRUS).
4. Dana Holdings (DAN) is up 5,200% from its bottom in 2009 and is an example of a company that tends to get hammered in a recession, but makes a comeback when the economy improves. Other strong performers in the sector include: Tenneco (TEN) and TRW (TRW).
Of all the above-mentioned stocks, Cramer would buy Pier One Imports (PIR) which has been a consistent performer and has strong growth prospects.
A Brighter View of Stocks
While the charts have been showing a bleak picture of late, one can take a more positive view by looking at the S&P 500's chart on a short-term basis. While Cramer is cautious and thinks the long-term action in stocks might not be so bullish, there might be some gains to be made in the short-term. The S&P 500 has shown support at 1123 consistently and has held the level nicely. The daily chart shows higher highs and the index could see a double bottom. However, if the index falls below 1120, "all bets are off," warned Cramer, and a move below that level would be very bearish for stocks. So while some profitable trades can be made, it is important to stay cautious.
Jim Cramer was up 31% in 2009. Click here now to sign up for Jim's Action Alerts PLUS and trade alongside him. Special discount for Seeking Alpha users.
Get Cramer's Picks by email - it's free and takes only a few seconds to sign up.