A major merger between two telecom giants boosted the companies' stocks this morning, but that isn't a green light to buy names in the crowded telecom sector, said Jim Cramer on his "RealMoney" radio show.
announced the merger of their network equipment businesses, and both stocks rose.
When two companies merge, the remaining companies in that sector make money, he said, and this merger is good for the telecom industry because it shows there is opportunity knocking even as the market goes down. This merger comes on the heels of a merger of telecom mammoths
However, despite the matchmaking, Cramer said he doesn't want to put more money in the telecom sector yet because there are still too many companies competing in it. There needs to be more consolidation, and until then, players have to be cautious when it comes to the telecom industry, Cramer said.
It's natural for people to believe that if a business is doing well in the U.S. it will be successful overseas. But this is not always the case, said Cramer.
A good example of a company that does not do well when it ventures abroad is
, Cramer said.
Although the retail giant has a great business domestically, it is not performing well in South Korea, Germany and the U.K. -- three areas it has gone into.
Wal-Mart is being hurt in the U.K. by a potential labor strike. If workers strike, it will hurt the company's business because it is antiunion, Cramer said. Additionally, Wal-Mart recently closed three stores in Germany, and sales are down in South Korea, too.
"This is a major defeat," Cramer said. "Wal-Mart is only up 3% for the year."
Two companies that have been able to make it successfully overseas are
, both of which have had phenomenal sales abroad, he said.
Cramer also said that
, whose restaurant brands include KFC, Pizza Hut and Taco Bell, has a great business in China.
He believes that
is a company that can do well overseas.
, a company which has a market capitalization of more than 15% in cash and a great management team, is a steal, said Cramer.
He recommended buying Schering, which he owns for his charitable trust,
Action Alerts PLUS to a caller who inquired about it.
When Cramer buys tech stocks, he likes to buy them when it gets close to back-to-school season, he said. He advised a caller to wait until August to buy
Advanced Micro Devices
, the world's largest unexploited gold mine located in Venezuela is a speculative stock, Cramer told the next caller.
He recommended not buying it with retirement or college money.
Cramer said he'd like to be positive about
, but the company is not doing well.
He predicted there would not be a takeover of the company because of its massiveness, and Cramer and told the caller to avoid buying its stock.
Instead, Cramer recommended looking into buying
Cramer told one caller that he believes that
will not come back up until the next quarter, and advised another caller to wait for
to come down from $5 to $4 before buying. He also reminded the caller that it is a speculative stock.
very much and called it the best liquid-crystal display company out there.
Cramer advised a caller to buy stocks that have been hammered and crushed, such as aluminum companies or basic mineral companies that have been down. He recommended
He said he would pull the trigger right now on
, a company that sells for four times earnings and has a growth rate of 16%.
Finally, Cramer told a caller that
is at a level where he would start to buy. He called it a great stock.
At the time of publication, Cramer was long Schering-Plough and Halliburton.
Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
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