Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Wednesday September 3.
PVH (PVH) has declined 14% so far this year, but delivered a 9 cent earnings beat with no cut in estimates---the first time in two quarters. Calvin Klein underwear business is performing well. The jeans segment, which had been performing poorly, is improving. "We are positioned very well for the second half of the year," said CEO Emanuel Chirico, saying the turn was helped by the back to school season. J.C. Penney (JCP) is "back on track" and that is good news for PVH. In Kohl's (KSS) PVH sales are coming back. Inventories are in-line and raw costs are flat or declining. Tommy Hilfiger is selling well in Europe, although the Continent has been volatile, so Chirico says he is keeping an eye on the region.
Concerning his confidence about the second half of the year, Chirico said, "It may be promotional, but it won't be crazy promotional."
Cramer said, "PVH is back. Maybe it never went away."
He added, "PVH will be the star of tomorrow's session."
Cramer gave his fantasy stock picks in honor of the advent of football season. Apple (AAPL) has fallen lately, but trading in and out of Apple doesn't work, and Cramer doesn't agree with people trying to game its major meeting. "Just own the darn thing." If it goes down, buy some.
Microsoft (MSFT) has so much going for it and can unlock value with a potential spinoff. He also thinks the stock could pay a dividend, PCs are coming back and its cloud business is real. Microsoft has rallied 20% this year, but Cramer wouldn't be concerned that it has risen too far.
Dow Chemical (DOW) should also join the team. Dow is benefiting from the energy revolution and has activist investor Dan Loeb behind it. The stock has gained 21% so far this year, but one shouldn't worry about overvaluation, it is a sign of strength.
Cramer took some calls:
GasLog (GLOG) is not a stock Cramer would get behind.
Cramer likes NXP Semiconductors (NXPI).
Micron (MU): Cramer would ring the register, since MU has seen large gains.
CEO Interview: Ben Van Beurden, Royal Dutch Shell (NYSE:RDS.A)
Royal Dutch Shell (RDS.A) is a great turnaround story and has a generous dividend of 4.7%. Since the appointment of a new CEO, Ben Van Beurden, the company has sold off non-performing assets and has been improving cash flow. "We're in places where it has been tough to do business, but we have always been in these place. You have to take a view on developments in a longer period than next week or next year even," speaking of possible issues in Russia and Ebola-stricken Nigeria. "In a hundred plus years of existence, we have dealt with some very serious issues." A third of Royal Dutch's assets are in the United States, which provides stability. In America, the headwind is objection to drilling, but given Royal Dutch Shell's diversified portfolio, the worries are minimized. "You are reinventing this company in a very radical and fantastic way," said Cramer. Its upcoming analyst meeting at the end of the week could be a catalyst for the stock.
Delta (DAL) announced strong domestic numbers but shaded down passenger revenue per seat because of the "impact of the events in Russia, the Middle East and Africa." The stock was down 5%. It isn't known as a company that does a lot of business overseas, but it is still being touched by the gloom. "This is the kind of news I fear most." This kind of news will affect automakers too.
CVS Caremark (CVS) gave up tobacco revenues, but the stock hit a new 52 week high. It can take such risks because it is a purely domestic company. There is now a gulf between domestic stocks and those that have some business overseas.
Cramer took some calls:
Rite Aid (NYSE:RAD) is a hold and has risen and had issues predicting margins. It is okay, but CVS now "has the ball."
Computer Sciences Corp (CSC) is a good stock that is cheap.
CEO Interview: Thomas Farrell, Dominion Resources (NYSE:D)
Dominion Resources (D) is one of Cramer's favorite utility stocks with a generous 3.6% yield. It announced a joint venture and will own 45% of a natural gas pipeline from the Marcellus and Utica shales to Virginia. This is a major embrace of the pipeline concept. Given the rise in production, there is a tremendous need for pipeline. It is the largest infrastructure project in the Mid-Atlantic for several decades. Of course, approval will be needed for regulators, but Farrell said, "We are very confident this pipeline will be built." Cramer said Dominion has been one of his favorite dividend paying stocks.
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