RealMoney Silver - H-P and Verizon Are Doing It Right

H-P and Verizon Are Doing It Right
By Jim Cramer
RealMoney.com Columnist
2/20/2008 8:43 AM EST

When things get tough, you are supposed to take share, move up in the standings, make real gains on the competitors and come out on top when the smoke clears.

That's just what is happening with Verizon (VZ) and Hewlett-Packard (HPQ) . Verizon knows that Comcast (CMCSA) , until this call, had been doing everything that Wall Street wanted and not spent to blunt FiOS.

But with tougher times you need bargains, and Verizon's giving them bargains on FiOS and now bargains on wireless. The latter will keep Comcast out of that area -- heavily focused on in the conference call -- and could very well wipe out Sprint (S) . I think Verizon knows Sprint is falling apart and only the press seems to take its business seriously. Verizon intends just to take its business.

HPQ knows that the personal-computer world is in disarray, and that Dell (DELL) hasn't been able to regain momentum and the other brands are too generic to inspire purchasing. HPQ also supports a magnificent marketing machine in printers. When I was working on the Kodak (EK) case in the Celebrity Apprentice show, it was clear that EK has a superior product with the cartridges costing much less, but EK doesn't have the marketing pull to much with it and HPQ is taking share big from Lexmark (LXK) .

Now, Mark Hurd has also made a decision to go into the storage business, where EMC (EMC) has dominated, and I think that he could very well make inroads there. I wouldn't panic if you are in EMC, as there is plenty of business go around, but it is a good new push for HPQ, which wants to be sure that when things improve internationally, he owns that market.

These companies are doing what competitive companies are supposed to be doing. Right now everyone and his brother seems to be worried about Verizon -- I say the dividend saves you there. HPQ, though, is making a strong case, and while tech is hated right now, HPQ overnight has become the tech it is hardest to hate.

At the time of publication, Cramer was long Hewlett-Packard and EMC.

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