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Cramer is guiding unsophisticated investors by making calls on their favorite stocks. When he comes across with a stock unfamiliar to him, he asks for time to do some research on it. In the last week's Mad Mail program, Cramer mentioned five stocks. He made three bullish and one bearish calls. I have examined all of his stock mentions from a fundamental perspective, and added my opinion about them. I have applied my O-Metrix Grading System where possible, as well. Here is a fundamental analysis of these stocks from Cramer's September 23 Mad Money:

Stock Name


Cramer's Suggestion

O-Metrix Score

My Take

Universal Display Corp.


Keep an Eye on the Stock





Risky Buy



Deere & Co.


Risky Buy


Buy, but alternative is better

Enterprise Products Partners




Buy Later

American Tower





Data from Finviz/Morningstar and is current as of September 23 close. You can download O-Metrix calculator, here.

Universal Display boomed after signing some agreements with Samsung and Panasonic. While Cramer does not care about this situation, he suggests keeping an eye on it anyway. It was trading at a P/E ratio of -97.1, and a forward P/E ratio of 63.7, as of September 23. Estimated annualized EPS growth for the next five years is 24.50%. It has no dividend policy, while the profit margin (-54.4%) is extremely horrible.

Target price is $49.86, implying an about 2.6% downside movement potential. The stock is trading 19.53% lower than its 52-week high, while it returned 120% in the last twelve months. Assets are completely unstable, and cash flow is doing terrible. P/B is 7.3, and P/S is 52.9, both of which are crushed by their industry averages. Operating margin is -20.4%. While ROE is -11.28%, ROA is -9.84%. PEG value is 1.6. Insiders hold 4.83% of the shares, and insiders have been mostly selling stocks for a while. I don’t think that the upwards trend is healthy, and it can come crushing down any minute with these indicators. This is familiar with the gold bubble. The stock just double-topped, and don’t expect anything more from it.

One viewer asked Cramer about choosing one between Caterpillar and Deere. He stated that this is not a good time to buy as both of them got hammered lately, but it would be Deere if he were to pick one. Here is a brief comparison between these two stocks:

Current as of September 23 close.



P/E ratio



Forward P/E ratio



Estimated EPS growth for the next 5 years



Dividend yield



Profit margin



Gross margin



Upside movement potential



Caterpillar returned -7.4% in a year, while Deere returned -6.5%. O-Metrix scores of Caterpillar and Deere are 6.23 and 5.60, respectively. Caterpillar is trading 36.36% lower than its 52-week high, whereas Deere is trading 32.05% lower. Caterpillar’s debt-to assets ratio is strolling around 50%s for some time, while that of Deere is hovering around 60%. It’s really hard to choose one between these two stocks. Cramer likes Deere more, but I think Caterpillar is a better play for emerging market growth.

One viewer said that he purchased January 2013 40 calls of Enterprise Products, and he wants to know what to do now. Cramer never suggests buying calls of stocks with such big dividends, but holding onto them is the best for now. As of the Friday close, Enterprise Products shows a trailing P/E ratio of 23.1, and a forward P/E ratio of 19.2. Estimated annual EPS growth for the next five years is 3.3%. Although profit margin (2.7%) is lower than the industry average of 4.1%, it offers a great dividend of 5.96%.

O-Metrix score of the company is 2.18. Insiders own only 0.60% of the stock, while it is currently trading 6.56% lower than its 52-week high. Target price is $47.76, which implies a 17.6% upside potential. While SMA50 is -2.09%, SMA200 is -1.39%. Enterprise Products returned 4.6% in the last twelve months. Debts are climbing up swiftly for the last five years. Operating margin and gross margin are 6.3% and 5.9%, respectively. ROA is 3.43%, whereas PEG value is 5.9. EPD offers a great yield, but the stock seems to be overpriced.

As American Tower is bullish on its future prospects, Cramer could get behind it. The Massachusetts-based American Tower, as of the September 23 close, was trading at a P/E ratio of 54.6, and a forward P/E ratio of 39.7. Analysts expect the company to have a 19.0% annualized EPS growth in the next five years, which sounds conservative when its 64.55% EPS growth of past five years is considered. Profit margin (17.3%) is way higher than the industry average of 10.0%, while it pays no dividend.

Target price is $58.00, indicating a 10.9% upside movement potential. O-Metrix score of American Tower is 2.01, and it is currently trading 8.00% lower than its 52-week high. The debt-to assets ratio is slightly increasing for the last five quarters, while it returned 0.9% in a year. Insiders own only 0.02% of the stock, whereas insider transactions have decreased by 7.40% within the last six months. P/E ratio, P/B (5.8), and P/S (9.5) are alarming red flags. ROA, ROE, and ROI are 3.93%, 10.99% and 4.56%, respectively. PEG value is 2.1. Insiders have been selling stocks and exercising options for a while. The expectations are high and it is an extremely risky company in a volatile environment.

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