Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Wednesday March 28.
Apple (NASDAQ:AAPL), Chipotle Mexican Grill (NYSE:CMG), Panera Bread (NASDAQ:PNRA), American Express (NYSE:AXP), JPMorgan (NYSE:JPM), Macy's (NYSE:M), PVH (NYSE:PVH), Hain Celestial (NASDAQ:HAIN), Whole Foods (NASDAQ:WFM), Annie's (NYSE:BNNY), Pentair (NYSE:PNR)
There was a survey about stocks on CNBC that Jim Cramer said, "took my breath away." It seems the public does not trust stocks, and rated the asset class as #3, behind gold and real estate. Of those surveyed, only 7% think it is a good time to buy stocks. A full 60% expressed some degree of mistrust concerning stocks in general, while the stock market has risen 60% since President Obama took office. Since the year began, stocks have flourished, so Cramer finds the results of the survey surprising. Apple (AAPL) has gained 50%, Chipotle Mexican Grill (CMG) and Panera (PNRA) have risen 24% and 19% respectively. American Express (AXP) is up 25%, JPMorgan, (JPM) 39%. In retail, Macy's has seen a 24% gain and PVH (PVH), 26%. The healthy food trend is going strong; Hain Celestial (HAIN) is up 21% and Whole Foods (WFM), 26%. Annie's (BNNY) IPO caught a breathtaking double, generating an 89% profit for those who got in on the IPO.
IPOs in general have been winners since the year began. Of the 30 deals, 10 have seen gains of 40% or more, 5 of them have risen 20%, and the "loser" IPOs declined 6% or less.
The bottom line? Hatred of stocks is absolutely unwarranted, and Cramer encouraged viewers to stay in the game.
Cramer took a call:
Pentair (PNR) has not been a great stock, but is coming back. Now is not the time to abandon it.
Cramer responded to a Tweet which posited that Wendy's (WEN) might be a better stock to buy than McDonald's (MCD) because a growing number of consumers think Wendy's burgers are superior to Burger King's, and in some cases, McDonald's. While Cramer said two weeks ago, he would have said McDonald's was without a doubt a superior stock to WEN, the resignation of MCD CEO Jim Skinner might be a sufficient handicap to make WEN a better buy. While many agree that Wendy's burgers taste better and are higher quality, the secret sauce is not the taste, but execution.
Wendy's is making ambitious plans, including remodeling, a shakeup of its workforce and a revamping of its image. The company wants to evolve from just another fast food chain to a higher-end casual dining play, like Chipotle. In addition, WEN, which has 95% of its stores in the U.S., is making aggressive moves to expand overseas. Cramer thinks WEN has bitten off more than it can chew, especially given its past track record of overpromising and underdelivering. The company only recently announced same store sales growth, while MCD consistently delivers same store sales increases of around 5% at home and internationally. MCD has a history of passing on higher commodity costs while improving efficiency at its stores. WEN has not been successful in these areas. Cramer thinks MCD is still a better buy, with a 15.4 multiple and a 10% growth rate. WEN has a 17.5% growth rate, but Cramer doesn't think this is necessarily sustainable, and it trades at a rich multiple of 22. McDonald's and Wendy's illustrates the principle that sometimes a company with a better product is not necessarily a stronger performer; the secret to success is brand recognition and execution.
Cramer took a call:
Dunkin' Brands (DNKN) has a secondary offering, and Cramer has a "great feeling" about it; "I want you in on the deal."
CEO Richard Davis, US Bancorp (NYSE:USB)
Cramer thinks US Bancorp (USB) is the best-run bank in America, and is rated number one "on every metric that matters." When the bank passed the stress test, it announced a 56% dividend boost and a large buyback that will shrink 5% of the float. USB is part of the "Hiring Our Heroes" initiative to encourage the hiring of veterans. CEO Richard Davis discussed the company's policy of going overseas to where soldiers serve and looking for new recruits for USB. The company hires many non-commissioned officers who understand efficiency, loyalty and trust.
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