A Capital IdeaAfter the president's speech Thursday night pledging to rebuild New Orleans, Jim Cramer wants to buy the soon-to-be largest bank in Louisiana, Capital One Financial ( COF - Get Report). Cramer noted Friday on his "Mad Money" TV show that Capital One is set to acquire Hibernia ( HIB), Louisiana's largest bank. Cramer said he believes Bush's plan to rebuild New Orleans through the use of private accounts will be a boon to the banks. Capital One is "about to pick up one of the only banks that will be making money in the horrible yield-curve environment." Cramer also is a fan of Capital One's credit card business. The company has had improving delinquency rates, he noted, and Congress recently passed legislation making it harder for people to default on their debt -- including credit card debt. Finally, Cramer said Capital One is likely to be a takeover target at the hands of Wachovia ( WB - Get Report). Wachovia has a relationship with MBNA ( KRB) for credit card issuance. But, MBNA is being acquired by Bank of America ( BAC - Get Report), a bitter rival of Wachovia. Wachovia will likely end its relationship with MBNA once MBNA becomes part of Bank of America, Cramer said. Wachovia will then probably seek to strike a deal with Capital One for credit card issuance or set out to acquire the company as Capital One is the only remaining large independent credit card company. "I want you to own Capital One because the president is bailing out Hibernia, and they're buying it, because Congress made it almost impossible to get out of credit card debt by going bankrupt, and because I'm betting Wachovia tries to take it over," said Cramer.
Games People PlayCramer, who has been bearish on video-game publishing stocks even as he's been bullish on retailer GameStop ( GME - Get Report) and Xbox 360 console-maker Microsoft ( MSFT - Get Report), has reconsidered his stance. He now believes "it's possible the video-game industry becomes the big story in the media over the next five years."
Over a BarrelDon't believe talk that perhaps we're not running out of oil, or that the price of oil is coming down, said Cramer. "The situation remains desperate." Proof of just how desperate, said Cramer, can be seen by the price Chinese investors paid for EnCana's ( ECA - Get Report) Ecuadorian properties this week. Cramer, who owns EnCana for his
Good FortuneFinally, Cramer noted news this week that a new agreement will allow a "billion dollars" of American wine to be sold in Europe that "couldn't be done before." Cramer had Bill Newlands, president of Fortune Brands' ( FO) Jim Beam Brands division on the show to ask if Fortune Brands would be able to sell more wine in Europe after the recent "truce." Newlands said indeed business conditions "are getting better than they once were," noting the U.K. market was a "big opportunity for California wines." Cramer summed up the interview saying the news is pertinent because Fortune Brands' "stock is down and down badly ... this is a stock that has historically returned a fabulous return ... they just got this great break ... I'm doing a 'mon back* on FO."
Lightning RoundBullish Cramer was bullish on CDW ( CDWC), Kinder Morgan Energy Partners ( KMP), Kinder Morgan Inc. ( KMI - Get Report), Central European Distribution ( CEDC), Brown & Brown ( BRO - Get Report), Annaly Mortgage Management ( NLY - Get Report), Motorola ( MOT), Apple Computer ( AAPL - Get Report), Powerwave Technologies ( PWAV), Quality Systems ( QSII), Allscripts Healthcare Solutions ( MDRX - Get Report), Psychiatric Solutions ( PSYS), SiRF Technology Holdings ( SIRF), Georgia-Pacific ( GP), Plum Creek Timber ( PCL), Weyerhaeuser ( WY - Get Report) and Sonic ( SONC). Bearish Cramer was bearish on Marriott ( MAR), IBM ( IBM), Fannie Mae ( FNM), Freddie Mac ( FRE), State Street ( STT), Hudson City Bancorp ( HCBK), Brightpoint ( CELL), Waste Management ( WMI), Allied Waste Industries ( AW), ImmunoGen ( IMGN), Phazar ( ANTP), EMC ( EMC), Granite Construction ( GVA), Louisiana-Pacific ( LPX), Boston Scientific ( BSX) and Take-Two Interactive Software ( TTWO). *For all you home-gamers, a 'mon-back opportunity means Cramer would back up the figurative truck and load up on a stock.
|1.||Pigs Get Slaughtered||2.||It's OK to Pay the Taxes|
|3.||Don't Buy All at Once||4.||Buy Damaged Stocks|
|5.||Diversify to Control Risk||6.||Do Your Homework|
|7.||Don't Panic||8.||Buy Best-of-Breed|
|9.||Defend Some Stocks||10.||Don't Bet on Bad Stocks|
|11.||Own Fewer Names||12.||Cash Is for Winners|
|13.||No Regrets||14.||Expect Corrections|
|15.||Know Bonds||16.||Don't Subsidize Losers|
|17.||No Room for Hope||18.||Be Flexible|
|19.||Quit When Execs Do||20.||Patience Is a Virtue|
|21.||Be a TV Critic||22.||When to Wait 30 Days|
|23.||Beware the Hype||24.||Explain Your Picks|
|25.||Find the Bull Market|