"A lot of you lug around a laptop and it feels like 20 pounds of excess fat," said Jim Cramer on his
"RealMoney" radio show Thursday. But if you opt for a top-of-the line cell phone or PDA you don't have enough firepower to manage your day. That's why he believes that Microsoft's ( MSFT) ultracompact computer, "project Origami" will be an incredibly popular new device. Unveiled in Germany, it has everything a laptop has, minus the keyboard, and it's the size of large paperback book, he said. Plus, Cramer said that it plays movies and music, has wireless connectivity, weighs only 2.5 pounds and should be available in a couple of months. But Microsoft, which he owns for his ActionAlerts PLUS charitable trust, "hasn't done anything at all for years," Cramer said. But he believes that there are three reasons why the company is poised to take off. The first is the company's new ultracompact computer, which he said "could take the world by storm." Microsoft is also introducing a new operating system, Vista, which he believes means that users will have to upgrade. And, Cramer said that the Xbox 360 is the third reason Microsoft stock is poised to move higher. The company is growing at 12%, and is cheaper than almost every stock that grows at that rate, Cramer said. Along with its "monster buyback" and the leadership of CEO Steve Ballmer, Cramer said the stock is right at $27. He also said that it's time to take a look at Hansen Natural ( HANS) now that The New York Times has reported that soda sales have fallen for the first time in 20 years. People are turning to energy drinks, he said, adding that Hansen is the pure play on energy drinks. But people are wise to this stock, which has jumped by 400%, he said. "When a stock is up 400%, it cannot be considered the easy money."
But it's also hard to find a company with Hansen's 20% growth rate, he said. So his strategy would be to buy 10 shares now, let it go higher, then take some profits off the table. If it goes up 50 points, you'll be happy, he said. Americans are drinking less soda, and they may end up steering clear of chicken if the bird flu hits North America as predicted in the next six to 12 months, he said. But Cramer said he's not going to fret. Instead, he's going to make some money from the prospect with BioCryst Pharmaceuticals ( BCRX). In a tough day, the company still gained a dollar. As with Hansen, this run-up shows that people know the story and that investors should be careful, he said. Cramer got behind the stock at $13, and then it went to $23. Cramer recommended that investors take some profits off the table because "bulls make money, bears make money, but hogs get slaughtered." Now it's down four points and heading lower to a level where Cramer would say buy it again. The company has the bird flu drug that could satisfy the federal government and the Food and Drug Administration, Cramer said, as well as a host of other treatments in the pipeline. That's why you need to think about it every time the price goes down between now and the fall, Cramer said.
Blowing in the WindJust like the rest of the country, the military is under pressure to reduce energy costs, with a mandate to cut energy spending by 2%, Cramer said, so the department will be forced to use alternative energy sources. General Electric ( GE) has entered into a $27 million partnership to design a next-generation offshore wind turbine for the military. GE is the parent company of CNBC, which airs Cramer's "Mad Money" TV show.
But a single wind-power contract is not going to move the stock of a company as large as GE, Cramer said. Instead, the play is Zoltek ( ZOLT), the company that makes carbon fibers used in windmills. Each week listeners send email to Cramer and tell him which stock they want to know more about. (Weigh in on what stock Cramer should discuss next week by taking our poll at the end of this story.) This week it was Nabors ( NBR), a company that was at $82 a share less than a month and a half ago but has slid to $64. "This stock has been crushed like a bug on a windshield," he said. But it is "the premiere land-drilling contractor" with great management, he said, and he thinks it still has legs. The stock has come down nearly 20 points, but oil prices are only off $8, he said. And to Cramer, this means that he sees a buying opportunity. He also gave listeners one of his 10 commandments of trading: Never turn a trade into an investment. For example, he said, an investor might buy 100 shares of Occidental Petroleum ( OXY) at $94 ahead of an upcoming analyst meeting. The investor believes that the stock will jump after execs use the meeting to lay out a great five-year plan, so this is a trade on the meeting. But say oil prices sink and the stock falls with it, regardless of the meeting. Cramer said to get out. "Suddenly you have 100 shares of a stock you bought for the trade and ... it goes down to $92. Do you buy more? Say you like the company and stick with it?" he asked. That would be breaking the commandment, he said. "Take that loss and get out. You're turning it into an investment ... you're turning it into a loss." Cramer reminded listeners that the way to interpret economic information can be very counterintuitive. For example, the trade deficit hit a record $68 billion in January, much more than Wall Street expected. Although that number may seem ominous, Cramer said it is also a positive sign that shows people in the U.S. are out there buying things, and he believes that it's good for us to buy other people's things now that we're in a global economy. Plus, he said, our exports are at the top of the food chain because they are primarily software and high-end products.
A caller wanted to know why LifeCell ( LIFC) stock fell when the company had a good quarter. Even though it was a "monster good quarter," we're in a weird period, a momentary bear market, when no matter what happens, it's treated like a negative, Cramer said. But he believes that the skin reconstruction business isn't about to end, so he would be inclined to buy after the stock comes down a few more points. Wait, let the stock go down another dollar, and then pull the trigger, Cramer said. Cramer agreed with another caller that Radvision ( RVSN) is a great company and said that he recommended the stock a year ago when it was at $12. The Israeli company is involved in the video-telephony business, and it has been red hot, Cramer said, adding that it's just now coming down to a level where he would recommend it again. The company's real-time voice and voice-data-communications applications, that work through the Internet, began as defense technology; and the company says it is just starting to develop its commercial side. This is why Cramer says it has more room to grow. In other defense-related stock plays, "if you're not that worried about terrorism, rest assured your government is," Cramer said, adding that this requires equipment, manpower and lots of money. So as President George W. Bush signs the renewal of the Patriot Act, Cramer said this translates into money for Viisage Technology ( VISG). The company has a "hammerlock on biometrics," meaning facial- and eye-recognition technology, he said. Finally, a caller told Cramer that her husband used to work for Intel ( INTC), so they now have lots of stock that is essentially doing nothing, but that he is reluctant to let it go. Cramer said he empathized. "Almost for as long as I've been in this business, I've been an Intel-a-holic," he said. The stock had a great run, but then co-founder Andy Grove stepped down as chief executive, Cramer said. Shortly after, Craig Barrett stepped down from the CEO spot. Those two men were both engineers, Cramer said, which is why they made superior products. Now the company is run by a salesman, Paul Otellini, and its products just aren't as good as Advanced Micro Devices' ( AMD), he said. The stock is just below $20, and Cramer told the caller that it was up to both she and her husband whether they could weather the pain all the way down to $17 and hope for a bounce. Either way, Cramer said it was probably a good idea to take some off the table.