Mad Money Recap
Cramer's 'Mad Money' Recap: Get Healthy With Triple-S
TheStreet.com Staff
12/10/07 - 08:05 PM EST
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Nothing is ever a sure thing on Wall Street, but investing in a non-profit health care company that turns into a for-profit company comes pretty darn close, Jim Cramer told viewers of his "Mad Money" TV show Monday. Cramer noted one group of stocks that fits this bill: non-profit Blue Cross-Blue Shield affiliates that turn into publicly held, for-profit companies. Cramer said he's run the numbers on the performance of these stocks, and the numbers show they work. During the first four years in the market, Cramer said he found that these stocks were up 28% a year on average. Last Friday, a company called Triple-S Management (GTS) went public, he said, and this one, just like the others, should make people a lot of money.
Hologic's Expansive Plans
With long-term visibility, great growth and a great balance sheet, Cramer told viewers Hologic (HOLX), which he owns for his charitable trust, Action Alerts PLUS, is his type of company. He welcomed Jack Cumming, Hologic's chief executive officer, to the show and asked him to give a sense of the company's recent merger with Cytyc. Cumming said they closed on the acquisition on Oct. 22, and that they're a little bit ahead of schedule. Cytyc, he said, shares the same passion for women's health, so the companies are very much alike. Concerning Hologic's recent $1.3 billion convertible bond offering, Cumming said the company plans to take the money from the offering and pay down its debt. "We loathe debt," he said, and it has been Hologic's policy not to have that much of it. Compared to competitors, Cumming said he believes Hologic has a "pretty good" head start when it comes to products. The company, he said, came to market two years behind other companies and is now nine months ahead in the competition for digital mammography. Cumming was enthusiastic about his company's growth prospects. "We believe that when you have nine No 1. products, you're expected to grow at a fantastic rate," Cumming said.Critiquing Regis' Stocks
People need to look at the market with a long-term perspective, and not worry about the short-term affects of the Fed, Cramer said. To see just how the how the holidays are shaping up, he welcomed his next guest, Regis Philbin, to the show.Beating Expectations Consistently
Cramer told viewers he has two underpromising, overdelivering "UPOD artists" that should be bought: Teledyne Technologies (TDY) and Ansys (ANSS). "Upod works because the bedrock predictor is the trumping of earnings estimates," he said. The first upod artist, Teledyne, has tapped into two of Cramer's long-term bull markets: aerospace and oil. Over the past two years, it's beaten estimates by an average of 15% every quarter, and it has taken control of its future through smart acquisitions, he said. The stock is cheap, but if investors wait, they might be able to get in at a better price, so he said he'd be cautious with this one. Ansys is the "market leader" in making simulation software and services, he said. Most of its business is done overseas, and 68% of its business is recurring, Cramer said. Moreover, it has met or exceeded expectations 40 consecutive times. While the stock is not cheap, it has a 19% growth rate and deserves a higher multiple, according to Cramer. The single best way to know who will beat earnings in the future is finding companies that have done so consistently in the past, he said. Teledyne and Ansys are two such companies, but even without their track records, Cramer believes they'd still be worth owning.