Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Wednesday February 15.
Oil tanker stocks have been poor performers with the overabundance of ships, but the industry is showing signs of a turn, especially since Frontline (FRO) management announced it would be buying ships. Nordic American Tanker (NAT) recently reported a loss, but said day rates were up 50% from last quarter and it still yields a generous 8.5%. Herbjorn Hansson said, "We are bumping along the bottom," and expects to see more upside ahead for oil tankers.
Masco (NYSE:MAS), Deere (NYSE:DE), Apple (NASDAQ:AAPL), Zynga (NASDAQ:ZNGA), Amazon (NASDAQ:AMZN), Bank of America (NYSE:BAC), Yahoo (YHOO), Teva Pharmaceuticals (NYSE:TEVA), Kraft (KFT), Nucor (NYSE:NUE), CSX (NYSE:CSX)
The Dow sank 97 points on Wednesday. Cramer discussed a few sour notes in the market:
1. Transports, which are a "tell" on the economy in general, fell on Wednesday. Cramer thinks this is mainly due to the drop in rail stocks, like CSX (CSX), which is suffering from weakness in the coal industry.
2. Masco's (MAS) poor quarter puts a damper in the enthusiasm about a possible housing comeback.
3. Deere (DE) declined, but Cramer commented this often happens with Deere, even when it reports strong earnings, because management is consistently downbeat. "Deere management should take Prozac."
4. Apple (AAPL) reversed intraday. Cramer thinks there is no reason to be bearish on Apple.
5. Zynga (ZNGA) reported a terrible first quarter as a public company. While the problems are likely Zynga-specific, it might cause investors to worry about social media in general, including the upcoming Facebook IPO.
6. Bank of America (BAC) has climbed so far this year, but a downgrade has brought it back to Earth. There may be worries that the apparent rebound in BAC was just a dead cat bounce.
7. Amazon (AMZN) has an overabundance of Kindles and may not have as many subscribers to its Amazon Premium program as expected.
Cramer took some calls:
Yahoo (YHOO) is doing poorly, but is being propped up by speculation; "ring the register and go home."
Teva Pharmaceutical (TEVA) may be on its way back after a long period of underperformance. Cramer thinks Teva has bottomed and will start to creep up.
Kraft (KFT) did the right thing by splitting up; "It will continue to be good."
Nucor (NUE) is suffering, along with other steel stocks from the Chinese dumping steel; "I think the Chinese have wrecked that industry."
CEO Interview: John Richels, Devon Energy Corp. (NYSE:DVN)
Devon (DVN) is yet another domestic energy play that is becoming more levered to oil rather than natural gas. Unlike other fuel stocks, Devon has yet to move up this year, until Wednesday, when it moved higher on an 8 cents earnings beat, and a 21% increase in revenues. The company is devoting 90% of its capital expenditures to making the company more of an oil than a natural gas company, and expects 20% production growth in the next year. Devon boosted its yield by 18%. CEO John Richels expects new finds and thinks the U.S. can come close to energy self-sufficiency. He called President Obama's blocking of the Keystone pipeline "irrational." There might be an opportunity for natural gas to come back as utilities need an alternative to coal and truck fleets make the switch to natural gas. Cramer thinks Devon has "a lot of years and a lot of performance ahead of it."
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