Mad Money Recap
Cramer's 'Mad Money' Recap: Routing the Short-Sellers
TheStreet.com Staff
04/01/08 - 07:59 PM EDT
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"There's an epic battle going on in the markets," Jim Cramer told viewers of his "Mad Money" TV show Tuesday.
Cramer: Opportunity Knocks for Banks |
A Sunny Outlook
Cramer said there is nothing sexier than a company taking control of its own destiny and transforming itself to succeed in a new economy. That's why he's recommending Applied Materials (AMAT - Cramer's Take - Stockpickr), a stock he has hated for years. While he is still not a fan of the semiconductor business, Cramer said Applied Materials has a secret that Wall Street hasn't noticed yet: its blossoming solar business. Applied Materials recently announced a $1.9 billion order for a gigawatt solar facility. The order underscores the company's CEO belief that the solar business is the greatest opportunity his company has ever seen. Cramer said momentum is starting to build in Applied Materials, which he noted is flush with cash, as much as $2.28 a share, for continued investment in solar ventures. He likened Applied Materials' prospects to that of Cypress Semiconductor (CY - Cramer's Take - Stockpickr) a year before it spun off its SunPower (SPWR - Cramer's Take - Stockpickr) solar division. Cramer says Wall Street still values Applied Materials as a semiconductor equipment stock, but as news of the company's solar division continues to surface, he sees up to 50% in upside potential.Land Drilling Resurgence
"We are at the beginning of a new land rush in natural gas," said Cramer. That's why he's changing his position on Nabors Industries (NBR - Cramer's Take - Stockpickr), a stock which he has disliked for more than three years. "It's comeback time," said Cramer, who now predicts U.S. land drillers will become good investments. And he said, "Nabors is the way to play." However, he said the company will likely see one more bad quarter before it truly bottoms. According to Cramer, Nabors has 89 idle drilling rigs that are currently idle. These rigs, which account for almost a quarter of Nabors' fleet, should soon see deployment as companies such as Chesapeake Energy (CHK - Cramer's Take - Stockpickr) and others ramp up domestic gas drilling operations.A Healthy Outlook
Cramer welcomed David Snow, Chairman and CEO of Medco Health Solutions (MHS - Cramer's Take - Stockpickr) for an update on the company's outlook. The stock is down 11% since Cramer's last recommendation in September. Snow said that his company is coming off of a phenomenal sales year. He said the company sold over $5 billion of new business and sees over $90 billion of branded drugs going off patent in the coming years. The company also raised its guidance by 5% on last conference call. When asked about recent changes to Medicare's Part B program, Snow responded by saying that Medco will not be adversely affected by the changes. He also noted the company's stock buyback program has $2 billion of shares left to buy and the company is actively buying shares at these low levels. Cramer called Snow a winner and said recent downgrades of Medco Health were just uncalled for.Sudden Death
Cramer was bullish on Tidewater (TDW - Cramer's Take - Stockpickr) and Frontline (FRO - Cramer's Take - Stockpickr). He was bearish on SCP Pool (POOL - Cramer's Take - Stockpickr) and Dryships (DRYS - Cramer's Take - Stockpickr).