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NEW YORK (
) -- "I'm tired of being tricked," Jim Cramer told his
TV show viewers on a special Halloween episode.
Cramer told viewers not to be fooled by the following stocks, as they never offer any treats. "Invest anywhere else," he said.
First on Cramer's trick-or-treat list were the airlines. Cramer said just because the plane is full, it doesn't mean the company is making any money. He recalled two horrid investments gone wrong, People's Express and a former incarnation of American Airlines, both in the 1980s.
Cramer said the airlines always have fuel problems, high labor costs and are in a business that's highly cyclical. "Don't even think about the airline stocks," he concluded.
Next on the list were the gold miners. Cramer said he's recommended some gold stocks on "Mad Money" in the past, only to be disappointed. "No more," he said, as even when these companies deliver their best, it never seems to be good enough. Cramer said investors who want to play gold need to own the bullion or
SPDR Gold Shares
, not the mining stocks.
Also on the list, supermarkets. Cramer said this business is cut-throat and has lots of waste. He said stocks like
are just tough to own. Cramer recommended only
, a healthy play the operates above the competition since they have pricing power.
Finally, Cramer offered up two tech stocks,
Advanced Micro Devices
, two "perennial single-digit midgets." Cramer said these two companies are always getting undercut by competitors and investors need to stay away.
Learning From Losers
Continuing with his Halloween theme, Cramer highlighted three stocks that "tricked" him into losing money. He said you can always learn more from your losers than your winners, so investors take heed.
Cramer's first misstep was
( ACOM) , the online genealogy resource that he first recommended in November, 2009. Shares of Ancestry were up 233%, but Cramer didn't recommend ringing the register and instead overstayed his welcome.
After two dismal quarters in a row, shares of Ancestry.com slid from $36 to $23 a share after the company raised subscription prices and tried to nudge subscribers into yearly plans. "They blew it," said Cramer, "and so did I." The company continues to forecast weaker demand for their service going forward.
Cramer's next trickster was
, which also imploded after it raised prices and tried to spin off its DVD business under the name Quickster. This once $235 stock is now an $82 stock, said Cramer, who is chastising himself for not recommending investors get out sooner. He said when a high-growth stock becomes a battleground, investors must take their money and run.
Finally, Cramer noted
( LUFK), an oil equipment maker that predicted a new wave of demand with the pickup in U.S. oil production. After two disappointing quarters, Cramer said it's clear that Lufkin is having trouble executing and investors need to steer clear.
Chinese IPO Duds
"Don't be taken in by cute costumes," Cramer warned viewers. He said that hot Chinese IPOs may be dressed up like reputable American companies, but in many cases they're far from it and can be hazardous to your wealth.
Cramer explained that after years of old, main-line Chinese manufacturing companies coming to the U.S. IPO market, lately the trend has been towards growth names ala dot-coms and solar plays. He said these companies all feature sky-high valuations and cute U.S. equivalents, like "the Chinese
" for example. "Chinese stocks don't have the same disclosures," Cramer reminded viewers, as he noted the recent performance of a few of them.
popped 86% on its first day of trading, only to fall 74% in the open market.
soared up 161%, only to fall 31% since. And
rocketed up 134% and has since fallen 38%.
Cramer said on average, these names are down 40% in the after market, which is why he continues to recommend only
. Only Baidu, the Chinese
has a proven track record, said Cramer, the rest are all hype.
Xilinx's New Chip
In the "Executive Decision" segment, Cramer once again sat down with Moshe Gavrielov, president and CEO of
, the leading provider of programmable logic devices and a company with a 2.3% dividend yield.
Gavrielov said his company's new 28-nanometer technology has 6.8 billion transistors on a single chip, twice as many as its nearest competitor. He said that Xilinx gets about 50% of its business from wired and wireless communications products, the infrastructure needed to service the growing number of wireless devices around the globe.
Gavrielov also said that Xilinx' current generation of products is 10 times faster than those made just three years ago, a compelling reason for the company's 10,000 customers to continue to upgrade their networks. Given that Xilinx services both wired and wireless networks, Gavrielov said his company's earnings are often balanced, as sometimes wireless is stronger and sometimes not.
Cramer commented on Xilinx' $1.5 billion in cash, something that Gavrielov said Xilinx will continue to use for stock buybacks and increases to their dividend. Cramer continued his recommendation on Xilinx.
Cramer was bearish on
Johnson & Johnson
In his "No Huddle Offense" segment, Cramer commanded viewers to never get behind a stock if they can't also get behind the company's management. He issued a big "mea culpa" on
, whose stock was on the Sell Block in April, but one that Cramer gave a reprieve to earlier this month.
Cramer said after Avon's dividend hit 4%, he told viewers it was worth owning. "I should have known better," he said, as Avon reported yet another dismal quarter and shares got pummeled. Cramer said he has no choice but to return CEO Andrea Jung to his "Wall of Shame," a position she held from 2006 to 2007.
Cramer said at a time when every other direct sales and beauty company is soaring, Avon has delivered just a 5% gain over the past two and a half years. After years of restructuring the company, Avon simply has nothing to show for it, he said, and there needs to be a change at the top.
--Written by Scott Rutt in Washington, D.C.
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At the time of publication, Cramer was not long any stock mentioned.
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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