Cramer's 'Mad Money' Recap: Next Week's Game Plan
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NEW YORK (
) -- Next week, it will be almost impossible to make money, Jim Cramer told
viewers Friday, but that doesn't mean investors can't listen and learn and prepare their next moves.
Cramer reminded viewers that the heart of earnings season is the most difficult time to trade, which is why he recommends sitting on the sidelines until after companies report.
So what will Cramer be listening to? He said that on Monday, he'll be listening to
PPG
(PPG) - Get PPG Industries, Inc. Report
to see how that company is faring as worldwide growth returns and commodity costs remain low.
For Tuesday, Cramer said
Lennar
(LEN) - Get Lennar Corporation Class A Report
will provide an outlook on housing in the U.S., while on Wednesday
JPMorgan Chase
TheStreet Recommends
(JPM) - Get JPMorgan Chase & Co. Report
will offer a look into the banking world. Cramer said he'd be a buyer of
eBay
on any weakness after that company reports on Wednesday, and would also pounce on
Kinder Morgan Energy Partners
(KMP)
.
Thursday brings more financials, including
Bank of America
(BAC) - Get Bank of America Corp Report
,
Citigroup
(C) - Get Citigroup Inc. Report
and
Capital One
(COF) - Get Capital One Financial Corporation Report
. Cramer said he likes Bank of America in the long term but would buy Capital One on weakness.
As for
Intel
(INTC) - Get Intel Corporation Report
, which also reports on Thursday, Cramer said he prefers
Action Alerts PLUS holding
Broadcom
undefined
.
Finally, on Friday it's
General Electric
(GE) - Get General Electric Company Report
taking center stage, along with
Johnson Controls
(JCI) - Get Johnson Controls International plc Report
and
Schlumberger
(SLB) - Get Schlumberger NV Report
. Cramer said GE, another Action Alerts PLUS name, should be able to beat expectations and he hopes to hear good things from Johnson Controls and Schlumberger over the long term.
Speculation Friday
For "Speculation Friday," Cramer featured sports apparel maker
Quiksilver
(ZQK)
, telling viewers that timing is everything, and in this case the timing may be all wrong. Quiksilver has been in the crosshairs of the Wall Street analysts, with Goldman Sachs recently upgrading the stock while Piper Jaffray downgraded the company.
Cramer said Quiksilver has been a wild ride, with the stock soaring in 2005 only to find itself near bankruptcy in 2008. The company does have a new CEO as of today however, something that Goldman noted as a big plus for the company. But Piper noted that while we don't yet have holiday sales data for Quiksilver, the evidence from those retailers that sell Quiksilver merchandise has not been promising.
Cramer said he's siding with Piper's research, as Quiksilver has an inconsistent history of delivering on its promises, and any turnaround at the company will likely take time to bear fruit. The company is aggressively cutting costs but it also has a terrible balance sheet, he noted. Quiksilver also derives 35% of its revenue from Europe, which is a big number that won't likely turn around until later this year.
So for now, Cramer said Quiksilver can't even be considered a speculative stock as it needs more time to solidify its turnaround efforts.
Stock Super Bowl
For his "Mad Money Stock Super Bowl," Cramer pitted
Bank of America
(BAC) - Get Bank of America Corp Report
against
Pulte Homes
(PHM) - Get PulteGroup, Inc. Report
to see which stock reigns supreme for 2013. Cramer said that based on votes he received on
, Back of America was heavily favored to win this showdown.
Last year, Bank of America booked a solid 109% return, while Pulte rose by 188%. Since 50% of a stock's performance is based on its sector, Cramer took a hard look at both the banks and housing to help determine the winner. He said banks should have a great 2013, but the group is still hampered by lingering legal issues and new regulations that are still cloudy at best.
The home builders, on the other hand, are getting ready for a multi-year boom, as home prices are finally stabilizing and new home formation is once again on the mend. Based on those facts, Cramer said the edge goes to Pulte.
As for the companies themselves, Cramer said it's a draw. Both companies are equally hated on Wall Street, leaving a lot of room for upgrades. Both are also aggressively cutting costs, trying to firm up their balance sheets.
Turning to valuation, Cramer said Bank of America is trading at 12 times earnings, which is a premium to its peers like JPMorgan Chase. Pulte, on the other hand, trades at 18 times earnings, which is still below its historical average.
Going over the data, Cramer said both companies are good ones and should do well in 2013, but based on the evidence, Pulte should be the stock having the better year. He said that in the home building sector,
Toll Brothers
(TOL) - Get Toll Brothers, Inc. Report
still remains his favorite, but as for this showdown, Pulte takes the Super Bowl trophy.
Lightning Round
In the Lightning Round, Cramer was bullish on
VirnetX
(VHC) - Get VirnetX Holding Corporation Report
,
ISIS Pharmaceuticals
(ISIS)
,
3D Systems
(DDD) - Get 3D Systems Corporation Report
,
Stratasys
(SSYS) - Get Stratasys Ltd. Report
,
The Bank of Ireland
(IRE)
,
Banco Santander
(SAN) - Get Banco Santander SA Report
and
CenturyLink
(CTL) - Get CenturyLink, Inc. Report
.
Cramer was bearish on
Buffalo Wild Wings
(BWLD)
,
Proto Labs
(PRLB) - Get Proto Labs, Inc. Report
and
Frontier Communications
(FTR) - Get Frontier Communications Corp. Report
.
Mad Mail
In the "Mad Mail" viewer feedback segment, Cramer followed up on
Cynosure
(CYNO)
, which stumped him during an earlier show. He said while the company's tattoo removal treatments are exciting, at 30 times earnings he needs to wait for a pullback before buying in .
Cramer said that
Accretive Health
(AH)
is also trading at a premium, which is why he likes
Athenahealth
(ATHN) - Get Athena Technology Acquisition Corp. Class A Report
. He is not a fan of
Just Energy Group
(JE) - Get Just Energy Group Inc. Report
as the company's high yield is a big red flag.
Cramer also responded to questions sent via Twitter to
. He said that
Darden Restaurants
(DRI) - Get Darden Restaurants, Inc. Report
has not been putting up the numbers he'd like to see, but drug maker
Sanofi Aventis
(SNY) - Get Sanofi Report
continues to be dynamite.
Cramer said to ring the register and take profits in
Groupon
(GRPN) - Get Groupon, Inc. Report
and he would not try to trade
Apple
(AAPL) - Get Apple Inc. Report
, an Action Alerts PLUS holding, but rather own it for the long term. Cramer closed out the segment by saying he's bullish on
Amazon.com
(AMZN) - Get Amazon.com, Inc. Report
up to $300 a share.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer recapped his big investment themes for 2013. He said that housing, autos, insurance, chemicals, energy, China, banking, aerospace and mobile technology are the places investors want to be when the market has its down days.
Cramer also added three other themes to the list. He said temporary staffing should soar higher as a way for companies to beat new taxes, and hospitals should also flourish under the new Obamacare laws.
Cramer called his final bull market theme for 2013 simply "do something," which includes companies that are making transformative acquisitions and taking control of their destinies.
Some highlights are
PVH
,
ConAgra
(CAG) - Get Conagra Brands, Inc. Report
,
Hormel Foods
(HRL) - Get Hormel Foods Corporation Report
and
Eaton
(ETN) - Get Eaton Corp. Plc Report
.
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To watch replays of Cramer's video segments, visit the Mad Money page on CNBC
.
-- Written by Scott Rutt in Washington, D.C.
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At the time of publication, Cramer's Action Alerts PLUS had positions in AAPL, BRCM, ETN, GE, SLB.
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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