Cramer's Mad Money - 5 Window Dressing Stocks Big Money May Buy Next Week (6/20/13)

by: Miriam Metzinger

Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Thursday June 20.

5 Window Dressing Stocks Big Money May Buy Next Week: First Solar (NASDAQ:FSLR), Advanced MicroDevices (NASDAQ:AMD), GameStop (NYSE:GME), Micron (NASDAQ:MU), Actavis (ACT). Other stocks mentioned: Sony (NYSE:SNE), Microsoft (NASDAQ:MSFT)

"It's the end of the quarter, not the end of the world," said Cramer. At the end of the quarter, fund managers tend to add "window dressing" in the form of great performers to portfolios to keep their clients happy. Cramer thinks Big Money might be buying the following stocks next week.

1. First Solar (FSLR) has risen 56% this quarter, and had a strong Analyst Day. Its costs are declining, the order book is booming and it is a best-of-breed solar company. However, Cramer would not buy FSLR because he believes the money has been made in the stock.

2. Advanced MicroDevices (AMD) moved up 52% this quarter. Many thought that AMD had too much exposure to PCs. Cramer was not fond of its lack of profitability and its debt. However, the advantages of its making the new processor for Sony's (SNE) Playstation and its powering of Microsoft's (MSFT) XBox are game changers for AMD. Cramer thinks it is likely to get upgraded and would consider buying on weakness.

3, GameStop (GME) is benefiting from the same trends as AMD, and has risen 46% this quarter. Estimates for the stock are too low. Cramer admits that he didn't initially believe in GameStop, but it should have a strong second half. Ideally, investors should wait for a pullback, but he's not sure if the stock will decline to give investors a buying opportunity. It might be alright to get in now.

4. Micron (MU) is Cramer's favorite of the 5, and has risen 36% this quarter. Cramer predicted "old school" tech names would be stocks worth buying. Micron reported a strong quarter with its first profit in 2 years and positive cash flow. The company makes DRAMs and is benefiting from increasing demand and the reduction of competition in the industry. Cramer says he hasn't seen Micron this hot since it more than quadrupled from 1999-2000 (although he doesn't think such a parabolic rise will necessarily be repeated point by point). He would buy Micron now.

5. Actavis (ACT) has risen 31%, and the stock "shot through the roof" on news of an acquisition that will fill the holes in the company's pipeline. Cramer would buy ACT into its current weakness.

Change of the Guard. Stock discussed: BlackRock Kelso Capital (NASDAQ:BKCC)

With the Dow collapsing 354 points, there is a change of the guard occurring, with certain sectors now leading the way and other segments lagging. With the perception that business is better and concerns that the Fed may raise interest rates sooner than expected, the defensive and high-yielding stocks, which make up 40% of the S&P 500, are being sold off. The three sectors that are likely to be the new leaders are technology, industrials and financials, in short, sectors that perform better when the economy is strong.

Cramer took some calls:

Cramer is bearish on silver. He would buy gold through gold coins.

BlackRock Kelso Capital (BKCC): It is hard to know what this company owns, and Cramer doesn't know how the company can pay a yield of 11%.

Viva Regional Banks: First Horizon (NYSE:FHN), Huntington Bancshares (NASDAQ:HBAN), KeyCorp (NYSE:KEY). Other stocks mentioned: Wells Fargo (NYSE:WFC), Cisco (NASDAQ:CSCO)

On a terrible day for stocks like Thursday, it can become apparent which sectors are going to be the new leaders based on what kind of stocks performed well. Regional banks like First Horizon (FHN), Huntington Bancshares (HBAN) and KeyCorp (KEY) did not experience the same kind of carnage the rest of the market did on Thursday. Many believe that higher interest rates are negative for banks, in part, because demand for loans drops, but regional banks fare better when interest rates are higher. These financials make money on fees, loans and CDs. The latter two components make money for the banks when interest rates are higher. Sometimes it takes a significant amount of time to figure out which stocks are worth buying after a major correction; this time around, it became clear in 24 hours.

Cramer took some calls:

When asked about the Volatility Index or the VIX, Cramer said, "It is reacting on plan," because it set a new high for the year. The VIX began spiking prior to the sell-off, so the correction was not surprising.

Wells Fargo (WFC) and Cisco (CSCO) are both holdings in Cramer's charitable trust. Cisco has risen significantly lately, and he would wait for both to decline further before buying.

Cramer took some calls:

Himax (NASDAQ:HIMX) isn't as good as Micron.

Arcelor Mittal (NYSE:MT): "I don't like steel," said Cramer.

CEO Interview: David Wenner, B&G Foods (NYSE:BGS)

B&G Foods (BGS) rose 6% on news that it is buying Pirate Brands, which produces healthy snack alternatives. While Cramer has warned that defensive stocks with high dividends are being sold now, he thinks BGS may be an exception, given its growth and introduction of new products. While Cramer doesn't recommend necessarily chasing yield, BGS has the advantage of a 3.5% dividend and has risen 202% since Cramer got behind it in October 2010. David Wenner is pleased with the acquisition and said, "We are poised to do another one." The company has strong cash flow and its new products are driving growth. "I told people to get out of food stocks," Cramer said, "That does not include B&G Foods."


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