Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Friday September 19.
11 Things To Watch In The Week Ahead: AutoZone (NYSE:AZO), Ascena (NASDAQ:ASNA), Bed Bath & Beyond (NASDAQ:BBBY), Carnival (NYSE:CCL), Paychex (NASDAQ:PAYX), Accenture (NYSE:ACN), Nike (NYSE:NKE), Micron (NASDAQ:MU), BlackBerry (BBRY). Other stocks mentioned: Royal Bank of Scotland (NYSE:RBS), SPDR Gold Trust ETF (NYSEARCA:GLD), Aflac (NYSE:AFL), AIG (NYSE:AIG), Travelers (NYSE:TRV)
Existing Home Sales might show some signs of slowing since the Fed did not seem keen to hike interest rates.
AutoZone (AZO) tends to sell off after it reports and then rally the next day. Cramer expects to hear that it continues to buy back stock.
Ascena (ASNA) reports, and has been disappointing lately, but Cramer thinks there might be an upside surprise. Lower cotton prices might help the company.
Bed Bath & Beyond (BBBY): Cramer doesn't expect anything good from it, and even private equity might avoid it.
Carnival Corp. (CCL) has been going up quietly. If it reports a decent number, it can go higher.
Citizens Financial IPO may be priced: Citizens is being spun off by Royal Bank of Scotland (RBS).
Paychex (PAYX) is down 5%, and that is a sign of slow growth for small and medium-sized businesses.
Accenture (ACN) has a history of disappointing earnings, but it often rebounds.
Nike (NKE) is benefiting from a "red hot shoe market," but the stock has run up too much. Cramer would sell half ahead of the quarter.
Micron (MU) might be facing too much supply. "I haven't liked the action in Micron. I think it is telling me to take a pass," said Cramer.
BlackBerry (BBRY) is in a long-term decline and "has been inching up too much for my liking." Cramer would resist the temptation to speculate on this stock.
Cramer took some calls:
Concerning SPDR Gold Trust ETF (GLD), Cramer said he would make gold 10% of a portfolio but would not rely too much on it.
Consolidation is helping retail since there is too much competition. Staples (SPLS) is down 18% year-to-date, and should buy Office Depot (ODP), said Cramer. A merger would be "the best thing that could happen" to both companies. Office Depot's stock has doubled since its merger with OfficeMax was announced, and the results of the deal were strong. The merger reduced competition and allowed the companies to cut costs dramatically. There are concerns that anti-trust regulators will block the deal with Staples, but FCC stated, regarding the OfficeMax and Office Depot merger, the climate had changed thanks to ecommerce, which made that particular deal not anti-competitive. Cramer thinks Staples could double its earnings power if it buys Office Depot.
Cramer took a call:
Constellation (STZ) does well on earnings and has a good risk/reward.
Alibaba (BABA) CEO Jack Ma has built what might be the fastest growing company on Earth right now. Alibaba gapped up to $92 from its pre-opening price of $68. Cramer was worried that this exuberant opening would lead to a downfall.
At its peak, Alibaba's market cap is the same as Wal-Mart's (WMT), although Alibaba has far more upside. It trades at a slight discount to Facebook (FB), even though its stock price is $93. Cramer thinks the stock is better to buy at a discount but added, "I believe in the company."
CEO Interview: Alex Smith, Pier 1 Imports (NYSE:PIR)
"What's wrong with Pier 1 Imports, and can it be fixed?" asked Cramer. The stock fell 18.5% since its disappointing quarter. The company missed on the top and bottom lines and slashed guidance, but management outlined a comeback strategy. Soft store traffic and declines in merchandise margins were headwinds. CEO Alex Smith said he is confident about the merchandise that is coming in for the holiday season; "We are absolutely going to give it our best shot."
The online business is "amazing," said Smith, but he added 25% of online sales are booked through PCs in actual stores and 33% of purchases are picked up in stores. "We see the stores and the online business as inextricably linked," said Smith. However, there may be some reduction in store count. Smith said the buyback will continue.
Lost amid the Alibaba hoopla was the news of the departure of Larry Ellison, founder and CEO, from Oracle (ORCL) and the purchase of Concur Technologies (CNQR) at a 24% premium by SAP (SAP). The two pieces of news seem to tell the story of "out with the old, in with the new." Ellison made Oracle dominant in the 90s and the first decade of the 20th century. However, Salesforce.com (CRM) with the cloud disrupted Oracle. At the same time, Oracle kept making hardware acquisitions, which have hurt the company. SAP has to keep up with CRM, and buying Concur is one way of doing it. Cramer thinks Oracle should have bought Concur instead of buying back stock.
Get Cramer's Picks by email - it's free and takes only a few seconds to sign up.