Cramer's 'Mad Money' Recap: Brazil Rocks
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"When it comes to investments, Brazil makes the U.S. look like wimps," Jim Cramer told viewers of his "Mad Money" TV show Thursday.
He wondered why investors would want to invest in U.S. stocks, with all their recession fears and economic issues, when they could in Brazil instead?According to Cramer, the Brazilian economy has a lot going for it. "Brazil is a country in charge of it's own destiny," he said.
Smart Moves"In this market, nothing is more important than safety," Cramer told viewers. That's why he recommended Dow Chemical (DOW) as a high-quality, high-yielding stock for consideration. Cramer said Dow has what investors need: a great dividend that is yielding 4.5%. The company also has a long history of paying that dividend and raising it, something the company has done 47 times in the past 95 years, Cramer noted. "This is not a fly-by-night operation," he said. Cramer likes Dow for the way it is reinventing itself as a non-cyclical stock. "Typically, you wouldn't consider a chemical company at this point in the cycle," but Dow is not a typical chemical company, he said. Cramer pointed out two recent partnerships to support his point. First, Dow entered into a joint venture with Kuwait on Dec. 13 to help lower the company's cost for oil and natural gas. Since that announcement, Cramer noted, Dow's stock has fallen. Cramer also pointed out Dow's recent partnership with agriculture favorite Monsanto (MON) to create new hybrid corn seeds. "As Dow becomes less of a chemical stock and more of an agriculture play, it gets more and more attractive," he said. Much of the downside is already priced into the stock, said Cramer, but none of the upside is yet. "Things are tough for Dow, but the company is responding."
Scale Out of NokiaIn the "Sell Block" segment, Cramer recommended investors begin selling Nokia (NOK) into any strength. According to Cramer, the time to sell Nokia is now, due in part to the Texas Instruments' (TXN) conference call Monday. On that call, Texas Instruments lowered its guidance, citing slower orders from a "large wireless customer." Cramer believes that customer to be Nokia. Cramer also sees problems on the horizon for Nokia due to a looming price war with the faltering Motorola (MOT) and increased competition from Apple's (AAPL) iPhone. The sell call was especially painful for Cramer, who's been a fan of the company since April, 2005. Since first recommending it, Nokia is up 100%, and is up 14% since July 2007. Although Nokia is the "best of the breed," he said, "you have to sell it in the face of lower demand and increased competition."
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