Click here for an archive of Cramer's "Mad Money" recaps.
Updated from 7:48 p.m. EST
Jim Cramer told viewers of his "Mad Money" TV show Tuesday to take a look at three initial public offerings scheduled to take place this week:
The public, media and Wall Street all are "fascinated with IPOs," he said. But although market-players can get coverage on these IPOs everywhere, only "Mad Money" gives advice on which ones to buy and which ones to avoid, and at which price to get in and out, Cramer said.
Cramer recommended staying away from
, and suggested getting into
when they came public.
Cramer also warned people to beware "
the Dog." However, he said he got
wrong because he trusted the private-equity firms that took it public.
When analyzing an IPO, Cramer said there are a few things people should consider. He advised investors to take a look at how the IPO is priced, then closely examine its "hotness."
Third, when Cramer looks at an IPO, he said he tries to figure out if it's "desperate" and needs the cash or if it's in good shape on its own. Furthermore, he thinks about whether or not the IPO should be "tossed back," and he always decides at which price he should sell it.
Finally, Cramer said he uses only limit orders.
IPG Photonics, an industrial laser company, was forecast to trade in the $13.50-$15.50 price range under the symbol IPGP.
The company manufactures fiber lasers for a range of uses from welding to delicate surgery.
Cramer said that if IPG Photonics prices in the middle of the range, it will be more expensive than its competitors. Although he said it should come public for $11.50 when comparing it to other laser companies, Cramer said IPG Photonics is not just any laser company. He believes it deserves to trade at a premium and said the Street knows this.
Cramer called IPG Photonics "a keeper" and said it controls 60% of its market. He said it has growth and could become a core tech holding.
He advised people to let the stock's action settle down before buying it, saying he would put his first limit order in between 10:30 a.m. and 11:30 a.m.
"This is a stock worth paying up for," he said. "It is the cream of the IPO crop."
(After the show aired, IPG Photonics priced above its range Tuesday night at $16.50, according to a
report, raising $148.5 million in a 9 million-share offering that represents 21% of the company.)
Guidance Software develops digital investigations and will trade under the symbol GUID when it debuts this week.
He called this initial offering the "price is right IPO." The company should come public somewhere between $12.50 and $14.50, which are "right prices," according to Cramer.
Cramer believes Guidance is worth buying under $18 a share, but when it gets above $20, he said people should ring the register.
Moreover, Cramer said he has "no doubt" Guidance is a "quality business" and has "a really rapid growth market." In fact, the $600 million market the company is in is expected to become a $1.4 billion market in 2009, he said.
Guidance sells its product to law enforcement agencies and big organizations, Cramer continued. Nearly one-fifth of the
500 companies use its software. Further, it has "high gross margins" and is "a pure play on digital forensics," he said.
Although Cramer said he doesn't consider this IPO "hot" like IPG Photonics, and it has established competitors, he said it is not "a desperation offering" and "it's not late to the game."
Guidance has the potential of becoming a core holding, he added. But it could go "unloved," which is why it's all about the price, Cramer said. He endorsed buying it anywhere under $18, but nowhere over $20.
As people have the desire to have wrinkle-free skin, Cramer said he has liked
for its Restylane product and
for its Juviderm and Botox products.
And although Artes Medical, which is scheduled to go public later this week under the ticker ARTE, looks like it was designed to get his approval, Cramer said he's dumping it.
He said he would call it "a triple sell to the third power," but it's not even public yet, so nobody's in it. Cramer explained he doesn't like this IPO because Artes is a start-up company with no revenue and one product.
Its one product, ArteFill, sounds "terrific" and the company says it's a permanent solution for wrinkle-free skin, he said. But even though "ArteFill sounds like a real game-breaker," Cramer said the Food and Dug Administration will not let Arte advertise it as a permanent solution.
Also, he pointed out the possibility that doctors will be unreceptive to ArteFill, like doctors in Europe and Canada have been. There is also the chance people who use ArteFill will develop skin inflammations, just like people who have used it allegedly have, and sue the company, Cramer said.
Arte has been losing money and is a "risky" IPO, he went on to say. Plus, Cramer believes if Allergan decided it wants to figure out how to make a competitive product, it could.
"As IPOs go, Artes has everything you don't want," he said. "It has no earnings, it has no sales and it can be easily abused by Allergan."
No matter how good its product might be, it is entering a market that already has a lot of players, Cramer said. "There's no room for Artes Medical."
In Cramer's "Mad Mail" segment, he told a viewer
seems like "dead money."
Responding to his next mailer, Cramer said the viewer was right and that companies have no obligation to follow through with their buyback announcements.
These are called "phantom buybacks," he said. To keep a check on which companies' buybacks are for real, Cramer said he continuously checks companies' share counts.
Cramer was bullish on
Research In Motion
Cramer was bearish on
For more of Cramer's insights during the Lightning Round, click here
Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by
In his "Sudden Death" round, Cramer was bullish on
At the time of publication, Cramer was long Hewlett-Packard.
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."
None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor TheStreet.com, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.
Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on TheStreet.com. The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in TheStreet.com, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.