Active Trader Update
When 'Buy What You Know' Doesn't Pay
12/13/06 - 02:13 PM EST
4. Krispy Kreme DoughnutsKKD: If you read Jim Cramer's Confessions of a Street Addict, then you probably know Jim as someone who lived for a Krispy Kreme and a great stock idea. Unfortunately, the company could deliver only the former, not the latter. Even though the "under new management" sign is hanging in Krispy Kreme's window, you have to wonder whether its business model is or ever was viable. Sales continue to decline. The baking business has always been tough. Dunkin Donuts has been handed from owner to owner for years with relatively little success. Just look at the history of Interstate Bakeries or Tasty Baking TSTY. Bring a dozen Krispy Kremes to your next client meeting, but don't sell them on the stock. Nothing beats McDonald's MCD when it comes to a food-service investment. 5. Alternative energy stocks: Let's reduce our dependence on fossil fuels and tell OPEC to stick it. It's the thought that counts. This entire asset class gets the great-product, bad-investment nod. We can use light, water, wind, steam or bovine excrement to generate energy for all I care. But even if Earth, Wind and Fire were to sing for us, it is highly unlikely that a stand-alone company is going to make you a dime in the alternative energy sector. Maybe some big-cap companies like Archer Daniels Midland ADM or a utility like FPL GroupFPL can hide their alternative energy losses under the rest of their profitable portfolios. Occasionally, a Johnny-come-lately alternative energy stock will go public and get investors all lathered up in the first few months of life, only to succumb eventually to traditional valuation techniques. The Pink Sheets and OTC bulletin boards are littered with the carcasses of alternative energy stocks. Here is a Web site devoted to alternative energy stocks. Go ahead, knock yourself out, and try to find a stand-alone alternative energy investment. Over the long run, these are bad investments. In the meantime, think green, and invest in Exxon Mobil XOM.
Satellite operator DirecTV could increase its dominant market share with high-definition offerings.
These could move substantially higher as the new year starts.
Several product rollouts should prove to separate the winners and losers in this sector.
Yahoo! is among the most searched stocks on TheStreet.com. Here's what Cramer had to say about the stock recently.
Catch up on his thinking on the hottest topics of the past week.
Investors will have to deal with a Fed meeting and another flood of earnings and economic data.
Ensco International and Echelon have the potential to move higher in coming days.
See who made what calls.
The addition of video is helping telecom companies compete against cable and satellite companies.
The June West Texas Intermediate contract reflects selling pressure ahead of Tuesday's expiration. But stocks in the sector are generally trading higher.
See who made what calls.
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