Icahn Trades - Cramer's Mad Money (6/9/08)

Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Monday June 9.

Petrohawk (HK)

While many bemoan skyrocketing oil prices, Cramer would find a way to profit. Contrary to popular belief, the price of oil is not being driven up by speculation, according to Cramer, but is subject to good old-fashioned supply and demand as it is becoming more difficult to get oil out of the ground and demand is rising in emerging markets. Cramer would take a look at wildcat drillers such as Petrohawk, one of the cheapest in the group with 1.1. trillion cubic feet of natural gas reserves. HK is benefiting from new finds in Arizona. Cramer expects Petrohawk to climb from $35 to $48.

CEO Interview: Michael Thaman, Owens Corning (OC)

Michael Thaman takes his company’s insulation business seriously; so seriously in fact that he says not having proper insulation may affect the resale value of homes in the near future. Not only is insulation big business, but Owens Corning makes fiberglass reinforcements that go into plastics and materials used in wind towers. Cramer is bullish on wind power, which is expected to grow by 10-15%. Although OC’s roofing business is lagging, Thaman expects to see profits from roofing in the second quarter. Cramer notes after a rise to $28, the stock is back down to $24 and is a buy.

Icahn’s Magic: Motorola (MOT), Yahoo (YHOO)

Cramer hasn’t had many nice things to say about Motorola or Yahoo, so why is he recommending the companies now? While the CEOs of both companies are displayed on his Wall of Shame, billionaire activist investor Carl Icahn may have a big impact on the stocks, and Cramer thinks Icahn could turn Motorola around by breaking it up He may also make a deal between Microsoft and Yahoo, if not an acquisition, possible so together they can compete against internet giant Google. Icahn can easily use his pull to replace members of the board of both companies, and Cramer thinks Yahoo and Motorola are both cheap. However, he would buy the stocks as Icahn trades, not based on the companies’ fundamentals.

Mad Mail: First Solar (FSLR), Harley Davidson (HOG)

Cramer’s one-time favorite solar play, First Solar, has fallen from grace due to insider selling; “No company with such aggressive insider selling will ever get my stamp of approval.” When asked about a motor-scooter play, Cramer said he would not buy Harley-Davidson yet, but he would keep an eye on it.

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Comments

[rileydawg:]

motor scooter play=hog...I dont think so. Although these motorcycles get better mpg than cars, on average, they are not scooters.

2008 Jun 10 05:51 PM

[Dakotasig:]

HK has no assets in Arizona. Great research.....

2008 Jun 10 06:25 PM

[bryanc:]

I don't think Harley will benefit from a "scooter" craze, because the only thing they really have in that area as far as cost/displacement is the Buell Blast.

But, there are a lot of people who will turn to motorcycling as a way to save money. HOG might benefit from a lot of people buying motorcycles to save $$$, and they could buy HD as an option if they are interested in a bike that maintains its resale value a little better. So Sportster sales may spike.

Sure, there are a lot of people who wil buy scooters, but there are far more who would not buy a scooter because a) it may be too small b) they want something that can run at true highway speed c) they have a longer commute.

So don;t discount HOG just because they do not sell scooters. Still, my bet would be on HONDA for this one -- cheaper bikes, very reliable, and plenty of scooters available.

2008 Jun 18 05:33 PM

[FUJIMO:]

So i am all google eyed watching Cramers TV program just trying to figure out what makes this man tick. One of his callers asked Cramer what his opinion is on the callers diversified stocks a total of five as I remember. As I recall Apple,Ford ,HD, plus two others. In Cramers frantic fashion he circles a couple stocks to keep ,then go's to the two transportation stocks if you will. HD and Ford. putting a big X on Ford at six bucks And a [iffy] circle around HD at $36. then makes a small quote that he doesn't understand why HD is not moving because of fuel prices. Let me do my first grade or pre school math . I came up with the Idea that I would rather have 200 slices of Ford over HD. At this point in time. I'am not being condesending but Cramer and most people in the USA would not know the differance from a Kawasaki Vulcan, Harley or a Yamha Star if the logos were removed. The fact that most people don't follow the movement of the motorcyles and what is on the highway. To think that people are going to run out and buy a 700 lb motorcyle to save fuel is totaly absurd. So back to the math What are people going to buy a scooter that is less than 5 grand 300 lb and automatic or a 700 lb bike that most people would be scared to death just to activate the clutch. Good luck to all because we are in tough times. Be wise.

2008 Jun 26 04:13 PM