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NEW YORK (
) -- "Stick with the five big themes of 2012," Jim Cramer announced to his
TV show viewers on Tuesday, as he told investors that the new year has given them multiple ways to win.
He then outlined the five big themes that will be working all year long, adding they're not all
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS. Cramer said that Apple is in a class by itself.
Cramer's first trend was the trend towards increased consumer spending, as evidenced by strong earnings from
. Cramer said with Coach blowing away the numbers, other luxury plays like
should do well. Also making the list was the newly minted
Cramer's second trend was that semiconductors have bottomed. He said that means great things for
, another Action Alerts PLUS holding, and
Third on Cramer's list is the cloud. He said that
had positive news and that might also bump up the earnings of other cloud players like
Cramer's fourth trend was simply "we're done with Europe." He said investors now expect the worst from Europe, so every bit of good news is a reason for U.S. stocks to rally. Investors are loving Euro banks and bonds, he said.
Cramer said the collapse in natural gas prices is his final big theme for 2012. He said this means poor performance from the drillers and oil service stocks, but with natural gas now giving king coal a run for its money, that's big news for
and anyone who's helping convert trucks from diesel to clean burning, U.S.-made natural gas.
Stick with these five themes and stick with Apple, said Cramer, and investors will have a winning year in 2012.
New Blockbuster Drugs
Continuing his "Breakthrough Medical Stocks" series, Cramer highlighted both
. The year of big pharma is not over, he proclaimed.
Cramer explained that after years of peddling new formations of existing drugs in order to preserve patent rights, big pharma has changed gears and is now pumping out specialty drugs that actually matter to the bottom line. He said that Eliquis, a new drug that prevents strokes in patients with atrial fibrillation, is one such blockbuster that's being developed jointly by Pfizer and Bristol Myers.
He said Eliquis could receive approval by the end of March, adding this $5 billion drug will definitely impact the bottom line of both companies, which will share in the profits equally. But despite this new blockbuster on the horizon, there's a lot more to like at these companies.
Cramer said that both companies have healthy balance sheets to support their dividend yields and even raise them, as both companies have been prone to do. Pfizer sports a 4% dividend yield, while Bristol has a 4.3% yield. Cramer also liked Pfizer's plans for breaking itself into separate companies, spinning off its animal health, consumer products and nutrition divisions while unlocking immense value for shareholders.
But if asked to choose between the two, Cramer said he'd pick Bristol Myers, as the company is smaller than Pfizer but still has plenty of other drugs in its pipeline that could surprise Wall Street, including a new drug to treat Hepatitis C. Shares of Bristol were up 33% last year and 20% since Cramer last recommended it in August.
switch places? Cramer said one is clearly breaking out while the other is breaking down.
Cramer said the two companies' conference calls couldn't have been more different, with Google praising itself for a lackluster quarter and Microsoft humbled by a terrific number. He said that Google's hubris made it seem out of touch with reality and made analysts decidedly unhappy.
When asked whether he was happy with the results, Google CEO Larry Page said "yes," while remaining unresponsive to questions about shrinking gross margins. Microsoft meanwhile has great margins, said Cramer, and unlike Google, which suffered in Europe and is non-existent in China, had great international growth to talk about on the call.
Cramer said its clear that Google is not monetizing its dozens of new initiatives, while Microsoft has been able to monetize its Xbox franchise and also its Bing search engine. Google also seems to have no answer for social services like Facebook and Twitter, nor the group buying trend like
Taking all of these factors into account, Cramer said the trajectories of these stocks makes sense. Microsoft, he said, is going higher, while Google is in the penalty box for at least one quarter to see if it can fix its mistakes.
In the "Executive Decision" segment, Cramer once again spoke with Richard Kinder, chairman and CEO of
Kinder Morgan Energy Partners
, an Action Alerts PLUS holding that's returned 122% since Cramer first recommended the master limited partnership in April 2007.
Kinder said that his company remains a good deal for investors as it continues to simply gas transportation throughout our country. He reaffirmed that Kinder Morgan Energy Partners, which trades under the ticker KMP, can continue to grow its distribution to shareholders by 7% a year, while its general partner,
, is on pace for growth of 12% a year. "We've delivered for 15 years," he continued.
Kinder was also quick to point out that the slumping price of natural gas means nothing for the company, which operates as a toll road, getting paid for every molecule that flows through its system. Kinder said that ultimately, these low natural gas prices in the U.S. will drive more growth in the industrial and transportation sector, and that will continue for the foreseeable future.
Kinder was also upbeat about the company's drilling efforts in Texas, where the company plans to ramp up to 7,000 barrels a day of oil production. The company is also seeing promising growth for its carbon-dioxide business, which provides the gas that is pumped into older wells to help recover more oil from them. Kinder said they're signing new contracts for carbon dioxide in the Permian Basin and elsewhere.
Finally, when asked about the delay in the Keystone XL pipeline, Kinder said that this project should be approved for many reasons. He said in the short term, its good for Kinder Morgan, but ultimately the country needs the pipeline as it tracks towards energy independence from non-North American sources.
Cramer continued his recommendation of Kinder Morgan. Any weakness, he said, and investors should get back in.
Cramer was bullish on
Booz Allen Hamilton
International Business Machines
Cramer was bearish on
In his "No Huddle Offense" segment, Cramer opined on the predictable patterns in the markets that still seem to allude most investors.
Cramer said that in every earnings season
runs up ahead of the quarter only to sell off thereafter. He said this dip is a terrific buying opportunity. He said that
almost always disappoints on its conference call, but then rallies later thanks to its 5.2% yield.
Other companies like
Johnson & Johnson
also show predictable patterns quarter after quarter, said Cramer. In each case, there's a buying opportunity either ahead of or after the results that investors should capitalize on.
--Written by Scott Rutt in Washington, D.C.
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At the time of publication, Cramer was long Apple, Broadcom, Kinder Morgan Energy Partners.
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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