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Did you miss last night's "Mad Money" on CNBC? If so, here are Jim Cramer's top takeaways for today's trading.
R.R. Donnelley (RRD) - Get Report : Cramer asks if R.R. Donnelley & Sons has gone through a bad breakup.The company spent the past decade making acquisitions to diversify its business, but those businesses became undervalued. That's why splitting up the company to unlock value seemed like such a good idea.
Earlier this month the split became official, with LSC Communications (LKSD) - Get Report and Donnelley Financial Solutions (DFIN) - Get Report joining R.R. Donnelly to make three separate, publicly-traded entities. However, all three have struggled since the breakup.
Cramer wanted to look to see if any of them seemed worthy of a buy.
LSC Communications is a leader in cost-effective print-related products. However, it's growth is flat to negative and without acquisitions, the stock will continue to flounder, Cramer said.
Donnelley Financial has slow growth, but at least it's growing. Because it has low fixed-costs, the company can be flexible and it has loyal customers. Plus, it's somewhat tied to financial markets, as it is responsible for a number of financial statements. Should deal-making and IPOs continue into the future, this company should benefit.
R.R. Donnelley is the strongest of all three, Cramer said. It has organic growth in the low- to mid-single digits and works with companies looking to communicate with its customers. While this is the most attractive stock of the three, it has been saddled with a majority of the debt too.
Here's the bottom line: While Cramer applauded the company's breakup strategy, there are still too many question marks. Which will pay a dividend and how much will it be? That needs to be answered first, he said, adding that he likes R.R. Donnelley and Donnelley Financial the most, but can't recommend them at this point.
Salesforce.com (CRM) - Get Report : On Wednesday, investors were buzzing about Colin Powell's hacked email account. Powell is a board member at Salesforce.com (CRM) - Get Report and among the discoveries was a leaked list of potential M&A candidates for Salesforce from a presentation in May. Of course, Cramer had to have a look too.
Investors can forget about Demandware (DWRE) , LinkedIn (LNKD) , Marketo and NetSuite (N) , all of which have been or are being acquired. Remember, the list is from May, so that's not too surprising that some are gone.
Adobe (ADBE) - Get Report is simply too large to acquire, Cramer said, while Workday (WDAY) - Get Report and Veeva Systems (VEEV) - Get Report also seem unlikely. Box (BOX) - Get Report and Zendesk (ZEN) - Get Report don't seem like they want to be bought and Salesforce seems unlikely to perform a hostile takeover.
That leaves just two companies from the list: HubSpot (HUBS) - Get Report and Pegasystems (PEGA) - Get Report . Both have a small enough market cap - $1.8 billion and $2.3 billion, respectively - and the businesses that would compliment Salesforce, Cramer said.
Here's the bottom line: Investors should never buy a stock solely for its M&A potential; the companies need to have solid fundamentals as well. However, Cramer said, a majority of the stocks listed above do have good fundamentals, so speculating on them may just pay off.
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At the time of publication, Cramer's Action Alerts PLUS had no position in stocks mentioned.