Cramer's 'Mad Money' Recap: Down, But Not Out (Final)
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NEW YORK (
) -- "Not everything is perfect in this market," Jim Cramer told his
TV show viewers Wednesday.
"But then again, it never is," he continued. Cramer said it's prudent to spend a little time examining the negatives, even if they're only minor points rather than major market worries.
Cramer said it's true that the transports got crushed today, but most of that weakness is coming from one sector, the rails, and most of the weakness in the rails is coming from one commodity, coal. He explained that with natural gas prices now low enough to compete with coal, this makes sense, but it's not a concern for the overall group.
Cramer said there's also been weakness in housing, but with homes still being built at an anemic pace, this weakness has been caused by traders getting ahead of themselves. He said that many traders bet on a turn in the first half of 2012 and it's now looking like that turn is more likely to occur in the second half.
Then there's agriculture. He said farming is big business, and with
John Deere
(DE) - Get Report
questioning peaking crop prices, it may seem like this sector is too hot. But in reality, it's just taking a breather, he said.
Cramer said the weakness in
Devon Energy
(DVN) - Get Report
has been a concern for some, as the company reported its cutting back its drilling. But in the details, Cramer noted that Devon is only cutting back on natural gas and is still drilling hard for the more lucrative oil.
In the tech sector, Cramer said that
Apple
(AAPL) - Get Report
, a stock which he owns for his charitable trust,
Action Alerts PLUS, is just fine. "It can't go up every day," he quipped. He said the problems at
Zynga
(ZNGA) - Get Report
are not indicative of other social media plays. He also noted that it's still not too late to sell
Amazon.com
(AMZN) - Get Report
, which he said is not done going lower.
Finally, Cramer said the weakness in the financials is largely due to a slowdown in shares of
Bank Of America
(BAC) - Get Report
, a move that's probably overdue.
In each of these points, Cramer said he understands the urge to sell, but in most cases, these are all just minor points and aren't reasons for major concerns.
Shareholders Deserve Better
In his "Anger Management" segment, Cramer sounded off against companies where "shareholders deserve better."
Case in point, the disappointing results from
Zynga
(ZNGA) - Get Report
. Cramer said the first quarter as a public company should be one to be proud of, like the one
Michael Kors
(KORS)
reported, and should not include a dramatic slowdown in growth.
Cramer also sounded off against
Weight Watchers
(WTW) - Get Report
, a company whose CEO painted a rosy picture on "Mad Money" last month, only to lower guidance today. He said the company announced a stock buyback in an effort to artificially boost earnings, but the damage has already been done.
Then there's
Abercrombie & Fitch
(ANF) - Get Report
, a company that cut its outlook just 13 days ago only to announce today that things are "better than expected."
Cramer also had questions for
Amazon.com
(AMZN) - Get Report
. It was widely predicted that Amazon had 10 million subscribers to its "prime" service, but recent reports indicated only about half that number. He said Amazons need to clarify that point.
Cramer also sounded off against
John Deere
(DE) - Get Report
, a company he said shoots itself in the foot every conference call by forecasting weak crop outlooks. He said companies shouldn't say everything is rosy, but does Deere have to scare investors every quarter?
Cramer said with the exception of Deere, which does deliver on its promises, he would be a seller of all these names.
Exciting Times
In the "Executive Decision" segment, Cramer spoke with John Richels, president and CEO of
Devon Energy
(DVN) - Get Report
, which reported an eight-cent-a-share earnings beat today on a 21% rise in revenues year over year. Shares of Devon were lagging the markets, only up 1% for the year, before their 7% pop on today's news.
Richels said it's an "exciting time" in the oil and gas business. He said not only has there been a revolution in U.S. natural gas drilling, but now that same technology is being applies to new and old oil discoveries with great success. He said there are still a lot of places right here in America that have undiscovered oil and the technological revolution is only just beginning. Richels wouldn't go into details, but he noted that Devon is working on four major new ventures and is adding acreage to all of them.
Richels did go into details on America's failed energy policy. He said our country can make big move towards energy self-sufficiency, but only if projects like the Keystone XL pipeline from Canada get approved. He called Obama's decision to cancel the project "totally irrational." He said it makes no sense to import oil from Venezuela and the Middle East and not import it from Canada, a friendly nation that's just across the border.
Turning to natural gas, Richels said that this clean, safe and American energy alternative will likely see continued softness throughout the summer, but America still needs to continue to use it. He said fleet vehicles are in the beginning stages of converting to natural gas, and refueling stations are being built, but America can do a lot more.
Cramer said Devon remains a great story with great potential. He continued to recommend the stock, even after its great run today.
Crawling Along the Bottom
In his second "Executive Decision" segment, Cramer once again sat down with Herbjorn Hansson, chairman and CEO of
Nordic American Tanker
(NAT) - Get Report
, for the latest read on the tanker industry.
Hansson described the tanker business as "crawling along the bottom," noting that things have been improving slowly for the past three quarters. He also noted that Nordic American, though, is still paying its dividend as it is shareholders to wait for demand to improve.
Turning to the world economy, Hansson said that while America and Asia are strong, the problem remains in Europe, where demand for oil is still very weak. Given rising tensions in the Middle East, however, Hansson said that traders may begin buying and storing more oil, selling it in the future at higher prices. "The world's economy is very dynamic," Hansson said.
When asked about the glut of new ships being built, Hansson said that new ship deliveries have been coming down over the past year, helping the industry stabilize with the number of ships currently online.
Finally, when asked about the possibility of expanding into liquified natural gas, Hansson said that Nordic American is paying attention to natural gas, but prefers for the moment to "stick with what they know best."
Cramer said that while things may not be rosy for the tanker group yet, they are at least better than they were before. "At least we've found the bottom," he noted.
Lightning Round
Cramer was bullish on
Heckmann
(HEK)
,
Kinder Morgan Energy Partners
(KMP)
and
Cerner
(CERN) - Get Report
.
Cramer was bearish on
Niska Gas Storage
(NKA)
,
Lumber Liquidators
(LL) - Get Report
,
Renren
(RENN) - Get Report
,
Enbridge
(ENB) - Get Report
and
Health Management
(HMSY) - Get Report
Am I Diversified?
Cramer spoke with callers to see if their portfolios have what it takes for today's markets. The first caller's portfolio included
Hecla Mining
(HL) - Get Report
,
Bunge
(BG) - Get Report
,
Westport Innovations
(WPRT) - Get Report
,
American Capital Agency
(AGNC) - Get Report
and
(GOOG) - Get Report
.
Cramer said this portfolio had "perfect diversification."
The second caller's top holdings included
AT&T
(T) - Get Report
,
Enterprise Product Partners
(EPD) - Get Report
,
Solar Capital
(SLRC) - Get Report
,
Bristol Myers-Squibb
(BMY) - Get Report
and
B&G Foods
(BGS) - Get Report
.
Cramer said this was a great high-yielding portfolio and was also perfectly diversified.
The third caller had
Annaly Capital
(NLY) - Get Report
,
Windstream
(WIN) - Get Report
,
International Paper
(IP) - Get Report
,
Eaton
(ETN) - Get Report
and
Energy Transfer Partners
(ETP)
.
Cramer also blessed this portfolio as diversified.
--Written by Scott Rutt in Washington, D.C.
To contact the writer of this article, click here:
Scott Rutt
.
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At the time of publication, Cramer was long Apple.
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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