Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Monday, September 10. Click on a stock ticker for more analysis:
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Cramer likened choosing a portfolio to selecting players in a fantasy football team, and said to prepare for tough economic times, solid defensive linemen are needed. He chose six linemen, beginning with PepsiCo, with a 2.2% yield and stability that resembles the Carolina Panthers. Medco Health Solutions sells medication to 20% of the diabetic population and is "consistently impressive" like the New England Patriots. Altria is like the "bad boys" of the NFL, the Baltimore Ravens, and has a winning dividend of 4.4%. Cramer likes NOC, which is not vulnerable to the Fed's whims, is cheaper than its rivals and resembles the Chicago Bears. McDonald's like the Pittsburgh Steelers, is consistent and is a great international play. PG and the Philadelphia Eagles solid "year in and year out" and PG has a 2.1% yield.
In addition to lineman, Quarterbacks are required for a good portfolio. A Quarterback company has to be "the best or among the best at what it does" and have stellar management. XOM is like dependable Peyton Manning, and the stock has a "fantastic buyback." Cramer thinks SLB is similar to Tom Brady, and adds that investors should wait for SLB, which will exceed 100, to drop a bit before buying. Matt Hasselbeck is "a great performer without much fanfare," a player similar to HPQ, the world's leader in PC production. Deere is "the Schlumberger of the plains," said Cramer, and resembles Carson Palmer. UTX has a strong global business and Cramer likes the CEO, who is like Drew Brees. Finally, he expects a great season for John Kitna and a great quarter for FWLT, 7 points from its high.
CEO Interview: Lew Frankfort Coach (COH)
Cramer emphasized the importance of strong CEOs, and illustrated his point by inviting Lew Frankfort of Coach onto the program. Frankfort discussed the company's handbag business is growing by double digits each year. The company has an operating income of $245 million, a 43% increase from last year, with and raised guidance of 22% year-over-year. Coach will continue to reach new markets North America and Asia and will move into fragrances and jewelry, Frankfort said. In spite of recession fears, the Coach customer is "alive, well, and shopping," said Frankfort.
Revenge of the Jocks
Cramer warned the US is heading for a recession unless the "cold, heartless Fed" abandons its too-little-too-late strategy and starts cutting rates more aggressively. He suggested a "Revenge of the Jocks" portfolio which will counteract the Fed's "nerd mentality" which lack real world experience. Cramer resolved to lead investors to latent bull markets in spite of "the nerd brigade." He added if Bernanke cuts rates a full percentage point, he will be "the best guy ever."
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