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NEW YORK (TheStreet) -- When stocks get hammered, they get cheaper, Jim Cramer reminded Mad Money viewers Monday. Prices matter, he said, which is why it appears that the momentum stocks may finally be bottoming.
Make no mistake, this market still values earnings per share and big dividends, Cramer said. But in the case of the once-high-flying momentum names, they now have a few things pulling in their favor.
The first positive for the momentum names is their price. A stock like Yelp (YELP) was pretty expensive a few weeks ago at $101 a share, but in the low-$50's that might make it attractive to a potential acquirer like Yahoo! (YHOO).The same applies to Tableau Software (DATA), which once traded at $102 a share but now trades at a scant $54. Cramer said SAP (SAP) should consider taking over Tableau. He also suggested Oracle (ORCL) may want to pick up Conquer Technology (CNQR), which has fallen from $130 to the low-$80's. Indeed, even the charts are looking better for these stocks, Cramer continued, as many now exhibit the bullish reverse head-and-shoulders formation. Also pulling in momentum's favor is the lack of new initial public offerings diluting the markets. Add all of these factors together and its easy to see why the short-sellers are getting nervous. Cramer said he expects the market's bounce to continue Tuesday, which would be a great time to take profits and trim positions as investors prepare for the market's next move.
The Case for Hillshire BrandsWith Hillshire Brands (HSH) making a bid for Pinnacle Foods (PF) last week, is it still worth owning Hillshire? One analyst says yes but another says no, leaving Cramer to weigh in. Cramer noted that the bull case for the $6.6 billion deal to acquire Pinnacle cites the additional $2.5 billion in sales Hillshire will be receiving, giving the combined company more shelf space and more clout with retailers. Add that to the co-branding opportunities, the synergies and the fact the deal is additive to earnings and it's easy to see why some analysts are cheering the deal.
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