NEW YORK (TheStreet) -- TheStreet's Jim Cramer asks why Allergan (AGN - Get Report) is going down. He thinks there is a perception now, which David Faber has discussed often, that Valeant's (VRX - Get Report) hostile takeover may have hit its high water mark.
Cramer says this has occurred because Valeant needs Allergan to get its stock to continue to rise, but Allergan has attacked its pursuer endlessly, which has made some investors stay away from Valeant. Cramer notes the chatter that Valeant could go higher if it walks away from Allergan. TheStreet's Herb Greenberg has repeatedly said Valeant needs to keep doing deals.
Cramer says Valeant has become a no man's land stock and he does not want to touch it. But if Allergan comes down to $140, then Cramer would buy it on earnings alone.
"We rate ALLERGAN INC (AGN) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow." You can view the full analysis from the report here: AGN Ratings Report AGN data by YCharts EXCLUSIVE OFFER: See inside Jim Cramer’s multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE.