Cramer's 'Mad Money' Recap: Ignoring the Obvious (Final)
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NEW YORK (
) -- "This market could use a few cheerleaders," were Jim Cramer's words to the viewers of his
TV show Tuesday, as he explained how the dot-crash crash a decade ago still influences how the stock market is reported today.
Cramer said the markets are still hung over from the collapse of 2001. He said that was the last time investors and those in the media were "allowed" to be exuberant and bullish on stocks. Since then, positive news is just seen as unhelpful, while negative sentiment is viewed as prudent and necessary.
But Cramer noted that with no incentives to accentuate the positives, investors have been losing out on a gigantic rally. He said with no one championing stocks on the way down, few will catch gains in stocks like
Nvidia
(NVDA) - Get Report
,
Eaton
(ETN) - Get Report
or
Weatherford
(WFT) - Get Report
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS. Cramer said all three of these names are great stocks that represent great value on this market weakness.
Cramer said the good news out of Washington has largely been ignored by the media, yet the tax cut and benefit compromise will actually spur growth in the economy in 2011 and will hype up consumer spending and even home buying. "These are gigantic positives," said Cramer.
Calling the editorializing of stocks "bogus," Cramer once again went on record recommending high growth stocks like
Apple
(AAPL) - Get Report
, another Action Alerts PLUS name,
Chipotle Mexican Grill
(CMG) - Get Report
and
Deckers
(DECK) - Get Report
.
Pure Networking Play
In the "Executive Decision" segment, Cramer sat down with Kevin Johnson, CEO of
Juniper Networks
(JNPR) - Get Report
, a stock Cramer last recommended on Nov. 11.
Johnson said that Juniper is a pure play on high performance networking and provides its customers with the capacity and confidence they need to deliver more traffic faster. He said Juniper invests 21% of its revenues, almost $1 billion, into research and development to help keep it an industry leader.
Juniper is focused in two areas, said Johnson, the mobile Internet and cloud computing. On the mobile side, Johnson said it's estimated that there will be 10 billion mobile devices over the next 10 years, and Juniper is a crucial link between cell towers and the Internet. As network traffic increases, so too will Juniper, which is providing the capacity to get that traffic to its destination.
When asked about supply shortages in its most recent quarter, Johnson said the component will remain "challenging" as the company sees increased demand for its hottest products. He said the entire industry is focused on manufacturing more components to satisfy demand.
Paradigm Shift
In a second interview, Cramer once again spoke with Mark Benioff, chairman and CEO of
Salesforce.com
(CRM) - Get Report
, on the heels of the company's Dreamforce annual event. Shares of Salesforce.com are up 52% since Cramer added the company to his high-growth portfolio in the beginning of June.
Benioff said there were over 30,000 people registered for Dreamforce, an event designed to educate customers on the company's products. He said Dreamforce, now in its eighth year, has become the third largest technology event in Silicon Valley.
Among the announcements at Dreamforce was database.com, a new cloud-based database platform designed to take aim at industry leader
Oracle
(ORCL) - Get Report
. Benioff described database.com as a repository for customers to easily access their data from other Salesforce.com products from anywhere without having to buy or administer servers or software.
When asked why everyone is not using Salesforce.com's products, Benioff said that with every new technology, there are paradigm shifts that create opportunities for new offerings. He said in the case of Salesforce.com, traditional software vendors have not responded to customers' needs and that leaves limitless opportunities.
Cramer once again recommended Salesforce.com as one of the leaders in the enterprise software marketplace.
Thumbs Up for Oracle
In the "Off The Charts" segment, Cramer went head to head with colleague Ken Shreve over the chart of
Oracle
(ORCL) - Get Report
to see if it's too late to buy this red hot purveyor of database software.
According to Shreve, Oracle's stock has been in a consolidation mode since November, posting three weekly price declines on progressively weaker volume. However recently, the stock moved higher on strong volume, indicating that the big money funds have once again begun buying the stock. Shreve recommended buying the stock if it breaks out above its recent highs.
Cramer said Oracle, a stock which he owns for Action Alerts PLUS, has a lot to like, and he would be a buyer now as opposed to at higher levels. Cramer said the naysayers hated Oracle's acquisition of Sun Microsystems, but in fact, the merger is going better than expected. The company has a lot going for it, said Cramer, and it trades at just 14 times earnings despite its 15% to 20% continued growth rate.
"Sometimes you have to stick with your winners," said Cramer, even if that means not getting in on the ground floor.
Lightning Round
Cramer was bullish on
Motricity
(MOTR)
and
Macy's
(M) - Get Report
.
He was bearish on
Netflix
(NFLX) - Get Report
,
j2 Global Communications
(JCOM) - Get Report
,
Riverbed Technologies
(RVBD)
,
Cirrus Logic
(CRUS) - Get Report
,
Wal-Mart
(WMT) - Get Report
and
United States Natural Gas
(UNG) - Get Report
.
Closing Comments
Cramer declared victory on
Nvidia
(NVDA) - Get Report
, a stock he recommended buying some five months ago.
Cramer said he was panned heavily after making the recommendation to buy the company it reported a miserable quarter that sent its stock down 50%.
Cramer said even he doesn't like the graphic chip market and feels there's too much risk in the sector. But with Nvidia shares already down by half, the company having one third of its market cap in cash and the stock having a huge short position, Cramer said the risk-reward was too compelling.
So with shares now up 69% from that recommendation, Cramer said it's time to ring the register on what was his most reviled, and successful, call of 2010.
Cramer once again recommended Juniper, which trades at 22 times earnings with a 20% long term growth rate.
--Written by Scott Rutt in Washington, D.C.
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At the time of publication, Cramer was long Weatherford, Apple.
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