New Cramer Buy Ideas: 5 Hot Picks

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 |  Includes: COST, CVX, DD, GLD, NKE
by: Investment Underground

Jim Cramer is more than just a talking head. He also invests money for his charitable trust. Below are 5 of his newest hot stock picks. As always use the list below as a starting point for your own research.

E.I. du Pont de Nemours & Company (NYSE:DD) is a science-based products and services company having a diverse range of products ranging from agriculture, animal health, building and construction, electronics, energy utilities, electronics, enzymes and many more. The company’s stock is currently trading at $46.40 at the day close on Sep 8th 2011. A change of negative $1.04 has been observed reflecting a negative growth rate of 2.19% from its previous close of

The P/E ratio reflecting the price paid for a share relative to the annual net income or profit earned is $12.87 whereas the EPS reflecting the profit allocated to each outstanding share of common stock after the dividends on preferred stock has been paid out is currently at $3.60. The dividend and its yield are at $0.41 and 3.53% respectively. Most of its competitors ranging from The Dow Chemical Company (NYSE:DOW) and FMC Corporation (NYSE:FMC) experienced a plunge in their stock prices from $27.07 high to 26.90 (-0.63%) and from $74.07 high to $73.03 low (1.40%).

On the contrary Akzo Nobel N.V. (OTCQX:AKZOY), one of the competitors of E.I. du Pont de Nemours & Company experienced an incline in their stock prices from $45.62 to $46.06 reflecting a $0.44 price increase accompanied by a growth rate of 0.96% at the end of the day close on September 8th 2011. The P/E ratio positioned at 10.46 with an EPS of $4.40.

This implies that the price paid for a share of E.I. du Pont de Nemours & Company is far higher than that of Akzo where as the earnings allocated to each outstanding share of common stock for Akzo i.e. 4.40 Is higher than that for which is $3.60. This implies that an investor with rational expectation of the market return at the moment would prefer the stock of Akzo Nobel over E.I. du Pont de Nemours & Company. The dividends paid along with the dividend yield for Akzo Nobel Akzo are higher than that of positioned at $1.44 and $4.33 respectively.

Hence any investor willing to invest in the science based products industry would be willing to invest in Akzo based on its performance in terms of paying out a higher dividend with a higher yield and a higher EPS.

Chevron Corporation (NYSE:CVX) works to meet the world's growing demand for energy by exploring for oil and natural gas; refining and marketing gasoline; producing chemicals and refined crude oil. The stock for Chevron Corporation fell from $99.29 high to $98.41 indicating a negative growth rate of – $0.89%. The P/E ratio is at $8.59 with an EPS of $11.45. The dividends paid out are priced at $0.78 with a dividend yield of $3.17.

The competitors for Chevron Corporation also experienced a downfall in their stock prices. Taking an example of Exxon Mobil Corporation (NYSE:XOM), it is observed that the stock price has lost its value from $73.65 to $72.82 indicating a negative growth rate of 1.13%. The dividends paid out are priced at $0.47 with a dividend yield of $2.58. The P/E ratio for Exxon is 9.57 with an EPS of 7.61.

This implies that as far as comparing these two stocks is concerned Chevron Corporation with a lower negative growth rate, higher EPS, higher dividends pricing and dividend yield would definitely be preferred by an investor having rational expectations of the market return.

Costco Wholesale Corporation (NASDAQ:COST) operates an international chain of membership warehouses, carrying brand name merchandises and thousands of other products. The stock is currently trading at $80.76 at the end of the day close on September 8th 2011. A change of a $0.15 has been observed reflecting a growth rate of 0.19% from its previous close of $80.61. The P/E ratio reflecting the price paid for a share relative to the annual net income or profit earned is $25.24 whereas the EPS reflecting the profit allocated to each outstanding share of common stock after the dividends on preferred stock has been paid out is currently at $3.20.

The dividend and its yield are at $0.24 and 1.19% respectively. On the contrary Wal-Mart Stores, Inc (NYSE:WMT) one of the competitors experienced a decline in its stock prices from $52.42 to $52.21 reflecting a $0.21 price decrease accompanied by a negative growth rate of 0.40% at the end of the day close on September 8th 2011. The P/E ratio positioned at 11.81 with an EPS of $4.42. The dividend yield for Wal-Mart Inc (WMT) is 2.80 with the dividends priced at 0.37.

This implies that the price paid for a share of Costco Wholesale Corporation is far higher than that of Wal-Mart where as the earnings allocated to each outstanding share of common stock for Wal-Mart i.e. 4.42 Is higher than that for Costco which is $3.20. On the contrary PriceSmart Inc. (NASDAQ:PSMT) stock is currently trading at $66.70 experienced a $0.57 price increase and an increase of 0.86% in its growth rate. The P/E ratio is 31.92 with an EPS of 2.09. The dividends are priced at $0.30 with a yield of $0.90.

This implies that an investor would be willing to purchase the shares of Wal-Mart Inc at the moment since its dividend yield; dividend pricing and the EPS are far higher than Costco Wholesale Corporation.

The iShares Gold Trust (NYSEARCA:IAU) seeks to correspond generally to the day-to-day movement of the price of gold bullion. The stock is currently priced at $18.23, experienced a $0.48 price increase accompanied by a 2.70% growth rate from its previous close of $17.75. The P/E ratio is 60.68 with an EPS of 0.30. No dividends have been paid out.

Other competitors of iShares Gold Trust such as SPDR Gold Trust (NYSEARCA:GLD) too experienced a positive growth rate of 2.67 % in its stock price, raising its stock price from a previous low of $177.08 to a $181.81 high. The P/E ratio is at $16.27 whereas the EPS is $11.18. No dividends have been paid out for SPDR Gold Trust too at the moment. Keeping in mind the statistics of the two trusts one may be indifferent in investing either in iShares Gold Trust or SPDR Gold Trust since both stocks have increased dramatically.

However, an investor may be inclined towards the shares of iShares Gold Trust based on its higher P/E ratio of $60.68 and its lower investment costs comparative to its growth rate.

Nike Inc (NYSE:NKE) is a major publicly traded sportswear and equipment supplier based in the United States. The stock price fell from an $85.51 high to an $ 85.33 low at the day close on September 8th 2011. The P/E ratio stood at 19.40 with an EPS of 4.40. The dividend and its yield are priced at $ 0.31 and $ 1.45 respectively.

On the contrary one of the competitors of NIKE, Deckers Outdoor Corp (NYSE:DECK) experienced a positive growth rate of 0.67% with an increase of $ 0.61 in its stock price from a 90.57 low to a $ 91.18. The P/E ratio is at $ 25.04 with an EPS of $ 3.64. No dividends are paid out for the stock of Deckers Outdoor Corp.

Based on the above statistics an investor would be willing to purchase the shares of Nike keeping in mind its diverse dividend payments, with a sustainable yield and a higher EPS.

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