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 October 28th show, Cramer discussed the following stocks:
Anadarko Petroleum (APC): One of the fastest-growing oil plays in the world, Anadarko Petroleum is positioned to benefit from oil discoveries off of Mozambique and other locations in Africa. Anadarko Petroleum has a $43.39 million market cap.
Herbalife (HLF): Cramer predicts Herbalife will embarrass Avon Products (AVP) when it reports next week, a company that Cramer said gives direct-selling a bad name. Herbalife yields 1.3%, trades at 20 times earnings and has a $7.25 billion market cap.
Emerson (EMR): A great play on non-residential construction, Cramer thinks it may be Emerson’s time to shine again. Emerson Electric trades at 15.5 times earnings, yields 2.8% and has a $36.94 billion market cap. Ken Fisher of Fisher Asset Management owns close to 5M shares (see more of Fisher’s portfolio).
Hain Celestial (HAIN): Cramer loves this high-end, healthy eating company, almost as much as he likes Whole Foods (WFM). Despite an analyst’s downgrade, Cramer said he has conviction in the company. Hain Celestial has a $1.5 billion market cap and trades at 28 times earnings.
EOG Resources (EOG): Cramer said that EOG Resources is so cheap, you could buy the stock for its Eagleford Shale assets and get the Bakken Shale assets for free. EOG Resources has a $25.57 billion market cap and trades at 60 times earnings.
Clean Harbors (CLH): This oil clean-up and waste removal company gives what Cramer calls the “good drilling seal of approval,” which makes oil companies employ its services. Being down $2 on the day may present a buying opportunity. Clean Harbors trades at 28 times earnings and has a $3.06 billion market cap.
Clorox (CLX): With a dividend on the rise and Latin American sales growing, Cramer said Clorox will show Proctor & Gamble (PG) how it’s done when it reports next week. Cramer gave Clorox a buy recommendation if the stock goes to $63. Clorox yields 3.5%, trades at 16.8 times earnings and has a $8.74 billion market cap.
Continental Resources (CLR): Cramer said Continental Resources is the best way to play the Bakken Shale. With their last quarter hurt by inclement weather, Cramer thinks it’s going to make up for it with a blowout third quarter. Continental Resources has a $11.46 billion market cap and trades at 126 times earnings.
Qualcomm (QCOM): Wireless networks are quickly migrating to 4G, which Qualcomm has “in spades”. Cramer is expecting good news from this tech seasonality play. Qualcomm yields 1.6%, trades at 22 times earnings and has a $89.41 billion market cap. Bill Miller of Legg Mason Capital Management reduced his position by 40% (see more of Miller’s picks here).
Apache (APA): Cramer’s charitable trust has been buying Apache and selling Chevron (CVX) because it lacks the production growth that Apache has. Down 30 points off its high, Cramer thinks buying Apache is a no-brainer. Apache has a $40.3 billion market cap and trades at 10.5 times earnings.
Chesapeake Energy (CHK): Chesapeake is the fastest shifting company from natural gas to oil in the industry, and Cramer thinks that is the right move. Chesapeake trades at 21 times earnings, yields 1.2% and has a $19.65 billion market cap. Boone Pickens of BP Capital increased his position by 17% (see more of Pickens’ stocks).
Skyworks Solutions (SWKS): After delivering one flawless quarter after another, Cramer is expecting to see some upside surprise based on how low the stock is. Skyworks Solutions has a PE ratio of 19.4 and a market cap of $3.78 billion.
Windstream (WIN): Cramer advised viewers to look no further than Windstream if your portfolio needs a decent telecom stock with a strong dividend now that AT&T (T) and Verizon (VZ) have gone so high. Windstream yields 8%, trades at 22 times earnings and has a $6.26 billion market cap.
Groupon (GRPN): Once again, Cramer told viewers this is will be the greatest first-day pop we’ll see and to get in and get out. Groupon is only offering 5% of the company to the public, which signals that this IPO has been engineered for quick fund-raising purposes.
Whirlpool (WHR): Down $8 on the day, Cramer told a viewer that the Whirlpool is too low to get rid of. Executing poorly and continual underperformance has led to the company to current levels. Whirlpool yields 3.8%, trades at 18.5 times earnings and has a $3.96 billion market cap.
Green Mountain Coffee Roasters (GMCR): A viewer called in and asked Cramer about GMCR saying that the patents for its K-Cups set to expire next year (creating immense competition) and there are impending charges for fraudulent reporting. We don't know whether there are any impending charges for fraudulent reporting but Whitney Tilson raised the possibility of accounting fraud at the company last week as well. David Einhorn also presented the stock as his "big short" idea at the Value Investing Congress and the stock took a nosedive since then. Cramer advised investors to stay away from this battleground stock. Green Mountain Coffee Roasters has a $10.87 billion market cap and trades at 65 times earnings.
Cypress Semiconductor (CY): This small semiconductor company creates programmable systems on a chip along with chips that power touch screens. Cypress sells to almost every manufacturer outside of Apple (AAPL). The chip-maker reported a strong quarter last week, with a $0.03 earnings beat on a $0.34 basis and in-line revenues that rose 14% year-over-year.
A couple of the company’s key customers like Research in Motion (RIMM) and Hewlett-Packard (HPQ) are struggling, with the latter getting out of the tablet business altogether. Cypress has a $3.39 billion market cap, yields 1.8% and trades at 26.6 times earnings.
The technology sector has become a battleground where the titans of the industry have been going head-to-head. Unlike the Wild Wild West, Cramer thinks there’s room for the competitors and their foes to succeed in the market.
ARM Holdings (ARMH) v. Intel (INTC): Cramer said ARM Holdings will crush Intel with their intellectual-property licensing model and close relationship to Apple. ARM Holdings is all about mobile devices. Their technology is in about 95% of mobile devices and MP3 players because their chips use less batter power.
Intel, however, has become a dominant player in the data storage sector, is extraordinarily cheap, yields 3.3% and will offer income and consistent growth. This will offset its link to the perennially slowing personal computer and Microsoft-based software.
Amazon (AMZN) v. Apple (AAPL): Amazon had to spend a lot of money in global expansion, which hurt its short-term margins. Cramer thinks the new Kindle Fire will destroy Barnes & Noble’s (BKS) Nook device. Cramer likes Amazon’s strategy of selling the Kindle Fire at a heavily-reduced price while making up for it by selling content through the device.
Although Cramer didn’t like Apple’s latest quarter, the stock is cheaper than the average stock in the S&P 500.
Google (GOOG) v. Apple (AAPL): Google’s Android is rapidly gaining market share and can effectively battle the iPhone. However, Cramer thinks there is plenty of room for both as both Google and Apple’s smartphones take market share away from Blackberry-maker Research in Motion (RIMM).
Cramer thinks that all of these tech companies can be bought on weakness because they represent the future.
NVIDIA (NVDA): Despite circulating rumors of a delay in anticipated innovations, Cramer has trust in CEO Jen-Hsun Huang because he consistently delivers. Cramer said NVIDIA is a buy at $15. The semi-conductor company has a $9.42 billion market cap and trades at 16.8 times earnings.
RightNow Technologies (RNOW): This technology company will be purchased by Oracle (ORCL), which Cramer sees as an attempt to put itself in position to compete with Salesforce.com (CRM). Cramer advised a viewer to sell the stock now and take the profit. RightNow Technologies has a $1.43 billion market cap and trades at 56 times earnings.
eBay (EBAY): Cramer said the online auction site is a serious buy because the current price is like getting PayPal for free. EBay trades at 23.6 times earnings and has a $43.92 billion market cap.
TriQuint Semiconductor (TQNT): Reporting a less-than-stellar quarter, Cramer said he doesn‘t like the stock, and would rather see investors in Skyworks Solutions (SWKS). TriQuint Semiconductor has a $911.23 million market cap and trades at 10.4 times earnings.
NetApp (NTAP): Cramer likes NetApp, but doesn’t think it’s better than EMC Corp. (EMC), which has a lower multiple. However, Cramer recommended them both because secular growth in big data is so powerful. Cramer’s charitable trust owns EMC Corp. NetApp trades at 25 times earnings and has a $15.32 billion market cap. Louis Navellier of Navellier & Associates reduced his position in NetApp by 5% (Navellier’s other stocks can be seen here).
General Dynamics (GD): Cramer told viewers to be careful with defense contractors because super-committee is looking to cut budgets as much as possible. General Dynamics has a $23.68 billion market cap, yields 2.8% and trades at 9.2 times earnings.
WellPoint (WLP): WellPoint reported a good quarter and is inexpensive, but Cramer suggested letting it fall a bit. Cramer recommended UnitedHealth (UNH) instead because it is cheaper and also reported a good quarter. Wellpoint yields 1.4%, trades at 9.2 times earnings and has a $23.89 billion market cap.
Red Hat (RHT): Cramer said when the smoke clears, Red Hat would be the tech stock to own, now it is hovering around the 52-week high. Red Hat trades at 76.30 times earnings and has a $10 billion market cap.
American Capital Agency Group (AGNC): Being a financial REIT, it is not Cramer‘s cup of tea, and he prefers Annaly Capital (NLY). Cramer thinks American Capital Agency’s 20% yield seemed too good to be true, but they’ve consistently paid it.
Deckers Outdoors (DECK): CEO Angel Martinez received praise from Cramer as perhaps the best retailer since Mickey Drexler and what he was able to accomplish at Gap (GPS). After Gap’s issues became too much to handle, Drexler was fired; after which he went to J. Crew and continued his retail accomplishments. Cramer sees international growth as the key to Decker’s ongoing success. Deckers has a $4.53 billion market cap and trades at 29 times earnings.