Wednesday, 01/02/08
Posted 01/02/08,  11:36 pm

(Scroll down to see Jim's comments below)

 
 
Today's date:  Wednesday, 01/02/08

  Dow Jones: 13,043    -220
  NASDAQ:   2,609     - 42
  S&P 500:   1,447     - 21
 
 
 
 
 
First Segment
 
Final Segment 1 Title: 'Last Year's Models'

.  .  .  .  .

Featured Stock(s): Goldman Sachs (GS*)
Altria (MO*)
Apple Inc. (AAPL)
NYSE Euronext, Inc. (NYX*)
BioMarin Pharmaceutical Inc. (BMRN)
Level 3 Communications Inc. (LVLT)

2nd segment picks below...

        

We spent most of this show talking about what we learned from my 2007 stocks of the year...  What went right and what went wrong, and the big picture takeaways from what happened with these stocks...

But I haven't told you what to do with them... what's in store for my 2007 stocks of the year in 2008?...

.  .  .  .  .

 

What should you do?...   What should you sell?... What should you hold onto?...  What should you buy?...

.  .  .  .  .

All right, let's start with the value stocks... Goldman Sachs (GS*), Altria (MO*), and Halliburton (HAL)...

Goldman Sachs (GS*) is still the best stock, but it's a crummy neighborhood.  It's not going to get better.  Although I will tell you that the Federal Reserve will cut over time.  So, by the end of the year, the environment for financials will probably look better...   But, I've got to tell you... 2008 is the year that even our clueless Fed will bail us out...  But, not quick enough for most. 

Stick with GS*... Don't expect a lot of appreciation... I do believe it deserves to trade at $300 but, as we know from the movie Unforgiven, deserves has nothing to do with it...

.  .  .  .  .

Now, Altria (MO*) is probably my absolute favorite of all these stocks for 2008...  I expect it to go much higher.  It's going to split up into international, domestic, and then start the mother of all buybacks... after being pent up for multiple years...  It wasn't allowed to buy.  They had a lot of cash... it was in reserve, waiting for the buyback.  The buyback's going to kick in next year.  You've got to be there...  

.  .  .  .  .

Halliburton (HAL) should work again... but it's more of a natural gas play, and I'd rather play the theme of natural gas with a stock that I'm going to be naming tomorrow... on tomorrow's show...

.  .  .  .  .

Then we've got the three growth names... Cisco (CSCO), Apple Inc. (AAPL) and the NYSE (NYX*)...

CSCO?... I'm worn out by it.  You can only fight the tape for so long.

I think CSCO is just going to be a marginal performer.  I like John Chambers but, look, what's the point, okay?...

I prefer The Four Horsemen of Tech, Apple Inc. (AAPL), Research In Motion (RIMM),   Google Inc. (GOOG), and Amazon.com (AMZN)...

Although, at this price, AMZN is a sell... It got recommended today... We've been on it for so long...

Beyond The Four Horsemen - and I've got to tell you, as long as they grow 30%, I'm going to be with them - I like Hewlett-Packard (HPQ*)...  It's not near growing as fast as the others, but it's inexpensive.  I own it for my trust...

.  .  .  .  .

Now Apple Inc. (AAPL) just happens to be the one of those four horsemen that I want you to think of as the New England Patriots...  Now, would you want to own them next year?... It's going to be very difficult to top a 16-0 season...  That's what AAPL had... But I still don't think you would bet against the Pats, and I wouldn't bet against AAPL either...

.  .  .  .  .

As for the NYSE (NYX*)... the bane of Cramer in 2007... I think it's having a great quarter... I think it's going to have a great year... but maybe... maybe people will recognize that it's more of a play on Europe this year...

This stock did everything right, and it still didn't do well but, if you look at from the point of view from someone who saw it in the $60s go into the $80s, it no longer seems stuck in the mud...

And when a stock is suddenly sprung from the mud like the NYX*, you hang on for the ride up...  I would buy this stock and I believe that Duncan Niedermeyer, the new CEO, will cut overhead much more aggressively than [John] Thane (the previous CEO) could, in part, because of French laws are now kind of saying it's all right... but also because Duncan Niedermeyer is a tech guy... and he understands... I don't think he's heartless, but he understands what needs to be done for the shareholders, in terms of cutting costs there...

I think the estimates are way too low for NYX*...

.  .  .  .  .

As for the speculative names, BioMarin (BMRN) should still work, thanks to the strength of Kuvan, which is the first and only FDA-approved drug for PKU.  By the way, I think there's going to be far more use than any of the numbers indicate. 

I like the pipeline too for BMRN...  It has a drug in Phase II tests for peripheral arterial diseases and sickle cell diseases...   Remember, BMRN is the stock that dreams are made of... 

.  .  .  .  .

As for the two big losers, let's own them again... Rite Aid (RAD) and Level 3 Communications (LVLT)...

I need to see a good quarter from RAD, as much as I think that Mary Sammons had the guts to come on this show.  It took real guts for her to come on the show after the beating that everybody who listened to me, and her, have taken...

But you know what?... Even after that, I cannot bless the stock until I see a couple of good quarters...

.  .  .  .  .

LVLT... I like it here.  Call me a glutton for punishment...

But video on the web, which is what it's levered to - and it had execution problems - and Jim Crow... the terrific CEO... is back to work after a life-threatening illness.  I'm sticking with Crow and I'm sticking with LVLT.

.  .  .  .  .

 

The Bottom Line!:    Cramer says Goldman Sachs (GS*), Altria Group Inc. (MO*), Apple Inc. (AAPL), NYSE Euronext, Inc. (NYX*) and Level 3 Communications Inc. (LVLT) are my 2007 plays that should do well in 2008... and are still worth owning.

.  .  .  .  .

 

 



See all of tonight's stocks' latest quotes on Yahoo! Finance


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Stock Snapshots - Includes all stocks mentioned above

 

 

 

Jim
Cramer's
rating on
this stock

STOCK
SYMBOL

Closing
price
that
day

Opening
price
next
day

Full Company Name/Comments
(see comments above for each)

GS*

207.60

208.92

Goldman Sachs (GS*)
 

MO*

74.93

75.08

Altria Group Inc. (MO*)
 

AAPL

194.84

195.49

Apple Inc. (AAPL)
 

NYX*

84.65

85.10

NYSE Euronext, Inc. (NYX*)
 

BMRN

36.64

36.79

BioMarin Pharmaceutical Inc. (BMRN)
 

 

       

LVLT

3.07

3.08

Level 3 Communications Inc. (LVLT)
 

         

Netflix, Inc.


 
 
Second Segment
 
 
Final Segment 2 Title: 'Mad Mail'

.  .  .  .  .

Featured Stock(s): See specific stocks below...


Jim
Cramer's
rating on
this stock

STOCK
SYMBOL

Closing
price
that
day

Opening
price
next
day

Full Company Name/Comments
(see comments above for each)

na

na

na

'Mad Mail'

General comments about how to know when to buy on pullbacks...


Q:  
 You've talked about buying on pullbacks and I've read about this dozens of times while reading your books, but what actually constitutes a nice pullback?  What percent?  Boeing (BA) has had a nice pullback...J. C. Penney (JCP), Sears (SHLD*), and most of the banks.  Is there a certain percentage pullback you suggest?

Jim:   Yes.  8-10% is my preferred range to start doing some buying but, remember, I buy on scales on the way down, as you know from reading
Real Money, or from reading, Stay Mad For Life

na

na

na

na

         
         

[ end of final segment ]

   
 

Go to the next segment from tonight's show here >>

See current quotes on Yahoo! Finance from tonight's show stocks here >>


Netflix, Inc.


Symbol keys:

A Charitable Trust stock. - An asterisk next to a stock symbol indicates that Jim mentioned it is a stock that he manages within
his charitable trust portfolio.  You can see the complete portfolio
of stocks here >>

Thumbs up - indicates he would buy the stock or, at the very least, not sell the stock.  We do our best to interpret Jim's opinion on stocks, as we think it is indicated by his comments during the show.  Please read his comments to decide for yourself.

Thumbs down - indicates he has said not to buy or to sell the stock, based on his comments  We do our best to interpret Jim's opinion on stocks, as we think it is indicated by his comments during the show.  Please read his comments to decide for yourself.

Back up the truck - indicated by Jim, when he says the stock is so good, that he would do a 'mon-back' on the stock... In other words, this is the sound someone would say to a truck driver, "Come on back... " as he is "backing up the truck" to load up on his cargo.  Translation for buying stocks:  This recommendation by Jim indicates that, after you do your own homework on the stock, you should feel comfortable loading up on it, as it is in a good position to be bought at this point.

Stumped. - Of the 2,000+ stocks that Jim Cramer has in his head, for which he has an informed opinion, he sometimes comes across a caller with a stock he does not know well enough to opine on...  He then indicates he is stumped and will have to come back to it, after he does some homework of his own on the stock.  This usually occurs during the Lightning Round, when Jim does not know in advance who is calling, or what their stock question is about.
 

 
Definitions of key phrases used by Jim, known as "Cramerisms":

Definition:   'Pull the trigger' is Jim's phrase for making the decision at that point to trade - either to 'buy' or to 'sell' (although he usually uses the phrase for buying), as if to say you should feel comfortable enough to make the final decision without looking back...

Definition:   'Ring the Register' is Jim's phrase for selling a stock, and making it a final sale, that you should not look back on.  Put it behind you.

Definition:  'Let It Come In' indicates how you may wait for it to pull back, or have the stock price come down briefly, as your chance (after letting it come in) to buy the rest of your position (i.e., total number of shares you own in that stock).

Definition:  'backing it up' or 'doing a 'mon-back' is Jim's phrase for the metaphor of backing up a truck to load up on a stock by buying it.  'Mon-back is short for the imaginary worker saying, 'Come on back...' as the truck is backing up to receive its load... Notice that we use the little truck icon to indicate where Jim has mentioned this.  Translation for buying stocks:  This recommendation by Jim indicates that, after you do your own homework on the stock, you should feel comfortable loading up on it, as it is in a good position to be bought at this point.
  See more "Cramerisms" & other financial phrases here >>
   
Helpful Websites:
  See the stocks currently known to be in Jim Cramer's
Charitable Trust at:

jim-cramer-charitable-trust-stocks.com

 
See the stocks currently known to be in Warren Buffett's portfolio
of stocks at:

warren-buffett-portfolio.com

 
  Stock Homework 101:   This is an excellent upcoming site that provides resources and links to help you do that homework that Jim Cramer recommends after hearing his suggestions...

StockHomework101.com

This site is coming soon.   Thank you.

 
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Fast Money Recap - Trades for next day...

Compare these picks to Jim's comments for the same stocks.

 

 

   
   
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