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just took an aim at
with its Zune music player, but Apple is still the leader of portable music, Jim Cramer told viewers of his "Mad Money" TV show Wednesday.
First of all, compared to Apple's iPod product, the Zune is too big and bulky, he said. And second, it comes in three colors, one of which is brown, a hue that is not likely to be popular among the younger set.
Reason No. 3 why Cramer believes the Zune is likely to fail is that its music store is not good compared to iTunes, which is easy to use.
In addition, although he likes Microsoft, Cramer said the company has been unable to reach the right demographic, which is the younger generation, whereas this demographic loves Apple.
He said he finds the Zune, which doesn't even have an original design, "pathetic." Moreover, the rankings for the product, which just
debuted Tuesday, are much lower than expected.
However, none of this is to say Cramer doesn't like Microsoft, because he does. He said he believes the company has done well and people should like it because of its new Vista operating system, not because of the Zune. However, it is no competition for the iPod, Cramer said. The iPod is just one reason among many to own Apple.
"Its laptops are very popular with the college generation," he said. "When you buy a Mac, you are buying a beautiful, easy-to-use machine."
Apple is "the most differentiated brand and only has a tiny bit of market share," Cramer continued, adding that he has never seen an empty Apple store.
Also, when Microsoft launches Vista, people might get frustrated with having to update their systems and turn to Apple.
In the end, "Apple is an iPod story," which is never-ending, he said. Plus, it has "a ton of financial flexibility," which could translate to buybacks and dividends in the future.
"It could go to $100 by the end of the year," Cramer said. "Apple is invincible thus far." Apple closed at $84.05 on Wednesday.
Am I Diversified?
In the "Am I Diversified" segment of the show, Cramer's first caller held the following five stocks in his portfolio:
- FedEx (FDX) - Get Report
- Ingram Micro (IM)
- Schering-Plough( SGP), which Cramer owns for his Action Alerts PLUS charitable trust
- Costco (COST) - Get Report
- AU Optronics (AUO)
Cramer told the caller he could not bless the portfolio as diversified because there was a pair with AU Optronics and Ingram Micro, both of which are tech stocks. He suggested swapping out of Ingram Micro and getting into a financial stock.
Cramer's second caller owned the following five stocks:
- Google (GOOG) - Get Report
- Altria (MO) - Get Report, another stock Cramer owns for his charitable trust
- CVS (CVS) - Get Report
- Electronic Arts( ERTS)
- Hercules Offshore (HERO)
Cramer blessed the portfolio as diversified, although he said he doesn't care too much for the exposure to
( CMX), a health care company CVS recently agreed
The third caller named the following five stocks:
- IAC InterActive (IACI)
- DiamondRock Hospitality (DRH) - Get Report
- Duke Energy (DUK) - Get Report
- Harley-Davidson (HOG) - Get Report
- Energy East( EAS)
Because Duke Energy and Energy East are both utility stocks, Cramer suggested the caller sell Energy East and get into a financial.
CEO Nelson Marchioli to the show and asked him how quickly the restaurant chain could clean up its balance sheet with its sales.
"Not only have we been positive for the last three months for customer counts, but we have also had positive same-store sales for the chain for 12 consecutive quarters," Marchioli responded. "We have to continue to deleverage, and it shouldn't be much longer.
"We are in the midst of balancing our debt, and we think we will be successful in this quarter," he went on to say.
The fact that Denny's is going to refinance means the stock could go from $4 to $6, Cramer said, adding that it is a better story than he thought.
To view Cramer's interview with Nelson Marchioli, please click here.
In Canada, Trusts
In response to all the email he gets regarding Canadian energy trusts, Cramer told viewers these stocks are worth owning now.
In fact, he said he would rent a U-Haul and back up the truck. Cramer believes two Canadian energy trusts,
Canetic Resources Trust
( CNE) and
Enterra Energy Trust
, are done going down and ready to bounce.
Even if these stocks don't move one bit, they are worth owning because they are "dividend-ilicious," he said, adding that Canetic offers a dividend of 19%, while Enterra has a 20% yield.
The dividends alone make these stocks attractive to Cramer.
"For years Canada had a rule that allowed any company turned into a trust that passes its income to investors without double taxation of dividends," he explained. But then oil began to fall and the government backtracked on a campaign promise not to tax the trusts as corporations.
The government recently announced that all these energy trusts would get taxed as corporations in four years and so these stocks fell.
Canetic has lost 30% of its value over this one piece of legislation that won't even go into effect until four years from now, he said. "It is way too cheap."
There is also a chance the government might change its mind and retract the law, an event that could cause both Canetic and Enterra shares to jump, Cramer said.
Another Canadian energy trust that Cramer says players could consider getting into is
Pengrowth Energy Trust
, which Merrill Lynch just upgraded this morning.
In addition, Cramer also likes
Baytex Energy Trust
Precision Drilling Trust
All five of these stocks are Canadian energy trusts that are bouncing, he said, adding that he believes that market players could catch a bottom here.
In the "Sudden Death" round, Cramer was bullish on
( LMC) and
Cramer was bullish on
Dick's Sporting Goods
Procter & Gamble
Cramer was bearish on
Abercrombie & Fitch
( GNSS) and
For more of Cramer's insights during the most recent Lightning Round,
Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by
At the time of publication, Cramer was long Altria, Schering-Plough and Sears Holdings.
Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."
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