This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Significance of Raising the Bar

Raising the bar. These are three little words that have taken on a currency, a virtual life of their own in this market. You have to know and understand the power of these words because, in many ways, they have become the determinant of the next 10 points in a stock.

When a company issues a quarterly report, it then presents expectations for the future. In the New Economy, a company that sits still, or doesn't raise the bar, gets pummeled. But a company that raises the bar, or sets new, higher expectations, is a company on the move.

Everybody in the know knows this lingo. It is incredible how often it comes up. Why did BEA Systems (BEAS) not go up after its blowout quarter? The company didn't raise the bar high enough. Why did Portal (PRSF) go up so big?

The bar was raised high. No matter that BEA Systems may have just been conservative, if that bar doesn't go up, there is all heck to pay.

Why does this matter? Because it is quite different from the old paradigm, which said that if a company beat the "whisper number," its stock went up. That went out of fashion as a primary method when CNBC began reporting the whisper number. Funny thing about whisper numbers. When they are shouted, they are no longer whispers.

The difficult thing for fundamental, nonchartist individual investors is that you can't find if the bar was really raised unless you are on those conference calls, many of which are closed. That these key sessions, where major material information is released, including how high the bar has been raised -- or worse, whether it has been lowered -- are closed is such a fundamental injustice as to be nothing but wrong.

Get used to this phrase. I have tried avoiding its use because jargon doesn't illuminate. But it is being used way too often not to give it to you as a piece of the puzzle.

Random musings: Don't forget to fill out our broker survey . This one has heft to it, and we need your input. We are bent on creating the largest online survey ever. ... MicroStrategy (MSTR) gets hit with a negative Forbes article and then issues a secondary. Probably set up for a run after those whackings. ... Great article about false negatives today in the right-hand column of The Wall Street Journal. ... Tip-of-the-chapeau department: My hat is off to James Padinha, who correctly predicted the Pimco rally (see Heard on the Street today in the C section of the Journal) ahead of its occurrence. Could have saved desks billions. There is no love between us, but you have to praise a home run call like that.

James J. Cramer is manager of a hedge fund and co-founder of At time of publication, his fund was long Portal Software. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,569.95 +213.08 1.23%
S&P 500 2,037.24 +24.35 1.21%
NASDAQ 4,706.8440 +62.5320 1.35%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs