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NEW YORK (
) -- Just read the headlines and it's easy to see why the markets are back at five-year highs, according to Jim Cramer.
viewers Monday that to find out why the markets keep rallying, they need only to read the front page of their newspapers.
Cramer said investors should, of course, always approach investing with at least a hint of worry. But today's markets are moving based on real economic demand, so much so the
may soon have to take notice and begin rolling back its stimulus.
So what are some of the things going right with our economy? Cramer pointed out a front-page story indicating the Republicans in the U.S. Congress may finally be willing to play ball with the Democrats and actually get some work done for a change. That's certainty positive.
Then there's a similar headline about a possible compromise on immigration reform. Wouldn't that be a boon for the U.S housing market if 11 million people could stop worrying about being thrown out of the country?
Other headlines continue to point to America's new oil and gas boom, which has not only put our country on the road to energy independence but also created tens of thousands of jobs in the process. Meanwhile, still other news stories point to a return of the retail investor to the markets -- more positive news.
At the individual company level, Cramer praised
for taking his advice and splitting itself up to bring out shareholder value. That stock soared 6% today. He said
announced similar plans.
All of these headlines add up to real reasons for being positive, said Cramer. Investors need to start taking notice.
In the "Executive Decision" segment, Cramer spoke with Dr. Phillip Frost, chairman and CEO of
, a speculative biotech name that's rallied 55% since Cramer last spoke with Frost just three months ago.
Frost provided an update on the company's new vitamin D formulation for the treatment of renal disease. He said Opko's new formulation will address some four million patients, which represents a $12 billion market opportunity for the company because there are currently no adequate treatments for the disease. Additionally, Frost noted the market in Japan is almost as large.
When asked how Opko discovered the new formulation, Frost indicated it was one of many successful acquisitions his company has made over the years. He also cited Claros, an acquisition completed in October 2011, as another such highly lucrative deal. Okpo has also partnered with several larger drug makers and will share in the revenue on drugs developed through their combined efforts.
When asked what's next for his company, Frost said Opko is nearing completion of its 4K test for prostate health. He said investors should be looking for more on that front in the "near future."
Cramer continued his support for Opko, saying the company and Frost have a proven track record of creating value for their shareholders as well as an uncanny ability to spot and acquire small companies with breakthrough products before the big boys take notice.
Know Your IPO
In the "Know Your IPO" segment, Cramer took a look back at the top eight best-performing IPOs from 2012 to remind investors what a successful IPO is all about. What do these eight newly-minted stocks all have in common? In a word, growth. While the
rose by 13.4% in 2012, the average IPO rose by 20.5%, with these notable exceptions.
Topping the list was
, a Chinese e-commerce company that delivered a 174% gain for the year.
came in second place, with a 146% gain for 2012. Cramer said this custom prototyping company has tons of growth potential.
Next up were
, a community bank with a red-hot mortgage business, up 132%; and
, a software provider for insurance companies that rose by 129%.
Continuing down the list, Cramer said that
provided investors with predictable growth and that stock rose by 128%, while
was another slow and steady grower, up 121% for 2012.
Rounding out the list were
( ELOQ), a marketing automation company, up 105% last year; and
, a company that manages employee flexible spending accounts. WageWorks rose 40% on its first day and ended the year up 98%.
Cramer said all of these companies should remind investors why speculating is a necessary part of every portfolio.
In the Lightning Round, Cramer was bullish on
Cramer was bearish on
First Niagara Financial
In the "Mad Mail" viewer feedback segment, Cramer followed up on
Monmouth Real Estate
, which stumped him during an earlier show. He said the REIT is too dependent on a single customer so he prefers
, which has a more defensive business model.
Cramer also followed up on auto parts maker
, saying this stock needs to cool off after its big rally. When asked to choose between
, Cramer said he'd prefer neither at the moment.
, Cramer said he wants to see the company continue to invest into its business rather than paying a dividend. "Focus on the growth," he concluded. He was also bullish on
Sirius XM Radio
as that company gets most of its new customers from the red-hot auto market.
Finally, Cramer told a viewer not to give up on
because he thinks the company is down but not out.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer opined on the battle between billionaires Bill Ackman and Carl Icahn, which aired on
He said that while there were no winners in the battle that has become
, it was interesting to note that Ackman was able to lay out his case for shorting a stock. Traditionally, fund managers only came on air to tout their long positions.
As for Herbalife, Cramer said it's not likely the stock will go to zero, as Ackman would like, nor see a huge short squeeze, as Icahn hopes. That only means that shares of Herbalife are heading nowhere for the foreseeable future.
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-- Written by Scott Rutt in Washington, D.C.
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At the time of publication, Cramer's Action Alerts PLUS had no position in stocks mentioned.
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