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 September 7th show, Cramer discussed the following stocks.
Cummins (CMI): This engine-maker does a lot of business in China, but the stock has been hammered ever since China has been aggressively raising rates. Cummins has a $17.7 billion market cap and the stock is trading $10 above its 52-week low of $79 per share.
Caterpillar (CAT): This Cramer-favorite has experienced trouble in China since the country’s inflation fears became widespread. The heavy-equipment maker has a $52 million market cap and the stock yields 2%. Jim Cramer has CAT in his charitable trust’s portfolio. Louis Navellier of Navellier & Associates also owns over 400,000 shares (see more of Navellier’s stocks here).
Joy Global (JOYG): The Chinese mining industry crushed earnings, but the stock was crushed as well because no one really believes China is done raising rates. The company raised full-year earnings and revenue guidance as well as announcing a sale of its Le Tourneau drilling operation for $375 million. Joy Global has a $8.6 billion market cap and trades at 15 times earnings.
Cramer said that United Technologies (UTX), Boeing (BA), General Motors (GM) and Alcoa (AA) could all benefit from a resurging China for continued growth and future upside. He said Coach (COH), Starbucks (SBUX) and YUM! Brands (YUM) will depend on China’s growing middle class for future growth.
Wynn Resorts (WYNN): Cramer loves this stock and said it could ramp up on the interest rate news from China because its most important market is Macau. This gaming company has a $19 billion market cap and yields 1.3%.
PPG Industries (PPG): The stock caught a huge break with China’s news, because the stock had been mercilessly hammered over potential Asian weakness beforehand. PPG has a $11.8 billion market cap and trades at 11 times earnings. The stock yields 3%.
Walter Energy (WLT): This stock has been making headlines, but Cramer said its rise is due to potential takeover and not the news out of China. The energy company has a $5.5 billion market cap and trades at 12 times earnings.
Chesapeake Energy (CHK): Chesapeake announced that it is investing $1 billion in natural gas, which makes Cramer like the stock that much more. The energy company has a $21 billion market cap and yields 1.1%
Westport Innovations (WPRT): Cramer recommended this energy company for its leading role in the future of natural gas. Westport converts petroleum-fueled engines into those that can run on liquefied natural gas. It recently made a deal with General Motors (GM) to make light-duty natural gas vehicles and launched a co-marketing program with Royal Dutch Shell (RDS.A) to form the North American market for liquefied natural gas powered vehicles.
Because of the recent 19% run-up, Cramer is expecting a pullback and recommends buying the stock when it happens. Westport has a $201 billion market cap, yields 5% and trades at 7 times earnings. George Soros of Soros Fund Management owns over 5 million shares (see more of Soros’ picks).
Deckers Outdoors (DECK): This Cramer-favorite stock has risen 5,000% over the past decade and he still thinks it is a buy. Cramer likes that it has built its own niche and has no direct competitors. The maker of UGGs has a $3.5 billion market cap and trades at 25 times earnings.
Hansen’s (HANS): This beverage company makes Monster energy drink and 90% of sales and profits come from the energy drink. Cramer sees growth in the company’s future and recommends buying on a pullback. The beverage maker has a $7.75 billion market cap and trades at 31 times earnings.
Netease.com (NTES): Cramer admits that he missed this Chinese gaming stock’s run-up. He doesn’t like it as a buy now, however. The company has a $6.3 billion market cap and trades at 11 times earnings.
Electronic Arts (ERTS): Cramer doesn’t like the gaming sector right now, but said Electronic Arts might be worth buying into a pullback. The video game maker has a $7.3 billion market cap.
Sohu.com (SOHU): Sohu.com is a brand advertising, online gaming sponsored search and wireless company based in China. While the stock has had an impressive run, Cramer still won’t recommend owning Chinese stocks other than Baidu (BIDU).
Dunkin’ Brands (DNKN): Cramer thinks the price-to-earnings multiple makes Dunkin’ too expensive compared with Starbucks (SBUX), which Cramer repeatedly recommends buying. Dunkin’ Brands has a $3.15 billion market cap.
Netflix (NFLX): This rapid growth stock has taken a recent hit based on a price hike and a content deal with Starz not going through. Cramer still thinks Netflix is a long-term buy. The company has a $11.17 billion market cap and currently trades at 55 times earnings.
Lululemon (LULU): Cramer thinks the best way to play this athletic apparel maker is through deep-in-the-money calls because of the dramatic moves the stock has made since no split occurred. The company has a $5.86 billion market cap and trades at 60 times earnings.
Accuride (ACW): The car part industry is booming as of late and Cramer thinks Accuride is a great way to play it now that the price has fallen in half. The company has a $390 million market share and is trading around $8 per share.
Sprint (S): Cramer doesn’t think the financials are favorable and does not recommend owning the struggling telecommunications company.
Ligand Pharmaceuticals (LGND): Cramer likes Ligand Pharma as a speculative play. The company has a $312 million market share and is trading at a new 52-week high.
CNOOC (CEO): While Cramer liked CNOOC, he recommended owning Chevron (CVX) instead. Cramer’s charitable trust owns Chevron and he feels it offers better financials with a similar yield. CNOOC has a $81.5 billion market cap and offers a 3% yield.
Disclosure: I am long CHK.