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Monday, 04/28/08
Posted 04/28/08, 10:09
pm ET |
(Scroll down to see Jim's
comments below) |
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Today's date:
Monday, 04/28/08 |
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Dow Jones: |
12,871 |
- 20 |
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NASDAQ: |
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2,424 |
+ 1 |
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S&P 500: |
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1,396 |
- 1 |
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Opening Segment 1
Title: |
'Window Shopping'
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Featured Stock(s): |
Apogee Enterprises Inc.
(APOG)
See APOG's official
website
here.
See the Yahoo!
Finance profile for
APOG
here.
See Opening Segment 2,
below...
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After this segment, you
can see Jim's Lightning
Round picks
here... |
JJC: Green
Week may be over... long
live Green Week... but
there's still a lot of
money to be made in
conservation and the
companies that stress
it...
Tonight, I've got an
under-the-radar play. This
is a stock that doesn't
have any sponsorship from
the big brokerage houses.
Some would call it an
orphan stock, just waiting
to be adopted by a Daddy
Warbucks, whose buying
could make you big bucks.
You've never heard of this
stock. You're going to
like it though...
The stock is Apogee
Enterprises Inc. (APOG)...
and it's part of something
called "the green building
movement..."
Now I know that this
sounds like some
Birkenstock-wearin',
granola-eating crowds...
No. A lot of green stocks
looked that way a year or
two years ago, but they've
had enormous gains,
because these are the ways
to battle and get back
from what you're spending
at the pump.
The idea behind green
building - which is now a
profitable business with
ramping growth - is to
construct buildings that
are more efficient users
of energy, letting the
companies that own the
buildings save enormously
on energy costs. I want
you to think of this as
the Feng Sui, only for
electricity instead of
Chi...
Now, specifically, APOG is
the dominant player in the
market for
energy-efficient and
aesthetic-engineered glass
for commercial
buildings...
Side note... I just want
to put this right up
front... the stock doesn't
trade well, because the
company is perceived to be
a residential housing
market... It has no
exposure to residential
housing whatsoever.
Let me give you in plain
English what APOG does...
APOG applies an ultra-thin
coating to glass that
improves the energy
efficiency of windows and,
as an added bonus, it can
also create colors, and
protect from hurricanes
and bomb blasts. Hey, how
about this? It's a hidden
terrorism and security
play too.
Their glass is being used
in President Clinton's
presidential library in
Arkansas, 7 World Trade
Center, the Bank of
America tower in New York
City, the Oklahoma Federal
Building in Oklahoma
City... all for
blast-proofing...
Green building is a
secular growth trend...
Everyone wants to use less
energy, because energy
prices are so high. It's
not held back by any of
the negative cyclical
forces, meaning the weak
domestic economy, that the
bears just love to harp
on...
Green building can reduce
a building's energy costs
by as much as 30-40%...
You're starting to talk
about some serious cash...
This is an environment
where energy is so
expensive, it's becoming
increasingly apparent that
you have to buy an APOG
window to save money.
I think APOG is an orphan
stock, right to be adopted
by some high-brokerage
houses, whose
recommendations and
research will then cause
big mutual funds and hedge
funds to buy the stock and
send it much higher...
Terrific fundamentals
here...
Look at APOG's recent
quarter, which it reported
on April 9th. 49 cents of
earnings per share. The
Street was looking for 45
cents, okay... Revenues
grew 18%... Upside
earnings guidance for
2009... They talking about
making $1.82 to $1.94 a
share. Consensus estimate
was $1.72.
This was a monster beat,
but no one cared, because
no one in a major firm
follows this company.
APOG's margins also
expanded. That means its
profitability - the
percentage of each dollar
of revenue that becomes
profit... This company is
executing fabulously...
APOG had closed at $16.84,
before the earnings
announcement, and then it
opened as soon as the
number came out, at
$19.87. It hasn't looked
back yet. Although, today,
we did get a good
pullback, down about 4% to
$20.59, which is why I
think it's so important
that you focus on it now.
This is less than a dollar
above where you could have
bought it right after its
great quarter.
The company has the
largest backlog (i.e.,
pending orders sold, but
not yet filled) in its
history... $510 million.
That's 87% of its market
cap...
Remember when we did
backlog with
GlobalSantaFe, and we got
that nice bid from
Transocean (RIG)?...
I always look at backlog.
This company has so much
backlog, versus its market
cap. I think you've got to
think about it.
I know management has....
They've increased their
stock buyback by 750,000
shares in January. They
bought shares in their
most recently-reported
quarter... about this, the
company said, "we hadn't
repurchased shares for
several quarters. We felt
it was an attractive
investment now."
And that was, for them,
because they paid an
average... oh boy, they
got in... at $15.96. If
APOG is inclined to keep
buying, it's got 1,911,000
left in its buyback
program. It can go
higher...
Okay, five analysts cover
the stock, but they're all
at smaller firms... Piper
Jaffrey, Cantacourt
Adams... Now those places
produce great research,
but they can't move stocks
the way the coverage from
one of the big firms, like
a Goldman, or a Morgan or
a Credit Suisse could...
And, if APOG keeps
producing great quarters
like its last one, it's
just bound to start
drawing itself some
attention. I want you in
before that...
How high can APOG go?...
What's APOG's apogee? Like
I could resist that...
Right now, the analyst
consensus estimate for
APOG is $1.87. APOG, I
think, can beat that. That
means APOG has a lowly
price-to-earnings ratio of
11. Man,
Eaton (ETN)'s
like that. ETN is 9. This
is 11. These are all
technology companies.
Lowball consensus is that
they're growing earnings
at 26%, and it sells at
11x earnings? That's
absurd.
If you want to use a more
conservative number,
APOG's long-term growth
rate is supposed to be
14%. Hey, why don't we
split the difference? Take
20% growth...
My rule of thumb is that
stocks with good
fundamentals usually trade
with multiples between 1x
and 2x their growth
rate... If we put APOG at
that very bottom of the
range... If we slap a 20x
multiple on $1.87, we're
talking about a $37
stock... 80% higher than
the current price...
All right, a little caveat
here... a small-cap
stock... Use limit orders.
No one listens to me...
I think... you will be a
loser if you pay up in the
after-hours... You will be
a loser if you pay up
tomorrow.
If you want to buy APOG,
be sure to wait at least
five days from now, before
you buy it. That's what we
say in
Stay Mad For Life...
Now, as I advise in
my book,
the five-day rule is the
best way to outperform...
. . . .
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The Bottom Line!:
Apogee Enterprises Inc.
(APOG)
is a great company with an
unknown, unsponsored
stock. But I believe
that's going to change,
and I think you need to be
in ahead of that. Five
days, and then buy APOG.
Buy it before then, and
we're all going to laugh
at you...
. . . .
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Stock Snapshots - Includes
all stocks mentioned above |
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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) |
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APOG |
20.59 |
na |
Apogee Enterprises Inc. (APOG)
Price target: $37.00
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See all of tonight's stocks'
latest quotes on
Yahoo! Finance |
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Most popular
investing books ordered:
(click any book to see at
Amazon.com) |
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Final Segment
2 Title: |
'Mad Mail'... |
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. . . .
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Featured
Stock(s): |
See comments below... |
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After this segment, you
can see Jim's
Sudden:Death picks
here... |
. . . .
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■ |
Stock Snapshots - Includes
all stocks mentioned above |
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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) |
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CLNE |
12.90 |
na |
Mad Mail
Clean Energy
Fuels Corp.
(CLNE)
Q:
You
mentioned CLNE
in October when
it was trading
at about $20. It
is now down
considerably,
and the company
has made
significant
progress in
opening 170 CNG
(i.e.,
compressed
natural gas)
stations, and
contracting with
various local
vehicle fleets.
The chart looks
good to me.
There is
essentially no
debt. Would you
revisit the
stock, and give
your more
current views?
JJC:
It's an
aggressive
growth stock. It
was difficult to
get a handle on
the earnings
versus, say, the
revenues. More
traditional
people might
want to go with
an
Eaton (ETN),
which makes
hybrid engines,
that I think is
probably a safer
play... It's a
spec, it's a
spec...
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ETN |
87.63 |
na |
Eaton Corp. (ETN)
See CLNE
comments above
for:
ETN
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COST |
70.83 |
na |
Mad Mail
Costco (COST)
Q:
H
JJC:
W
TJX (TJX)
Wal-Mart (WMT)
Urban Outfitters (URBN)
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TJX |
32.90 |
na |
Mad Mail
TJX (TJX)
See COST
comments above
for:
TJX
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WMT |
57.35 |
na |
Mad Mail
Wal-Mart (WMT)
See COST
comments above
for:
WMT
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URBN |
33.13 |
na |
Mad Mail
Urban Outfitters (URBN)
See COST
comments above
for:
URBN
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CPL |
70.71 |
na |
Mad Mail
CPFL Energia S.A. (CPL)
Q:
I own
Petroleo Brasileiro (PBR)
and you often
mention other
Brazilian stocks
that you like,
notably
CVRD (RIO)
and CPL. A few
weeks ago, you
said that Latin
American stocks
are "trades" and
not investments,
but it seems
that CPL is more
of a long-term
play. Please
clarify if
Brazil should be
included in your
view on Latin
American stocks
or is it an
exception?
JJC:
That came from
what we said in
Stay Mad For Life,
in that we never
want to stay too
long in Latin
America, but
Brazil is a very
advanced nation,
and I really
want to mention
that I think
Brazil should be
exempted,
basically, from
the trading
rules. Brazil
has had its
destiny under
control for a
long time, and
CPL, absolutely,
is just a great
utility.
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SQM |
30.07 |
na |
Mad Mail
Chemical & Mining Co. of Chile Inc.
(SQM)
Q:
I enjoyed your
Green Week show
last week. But
you never
mentioned any
lithium battery
companies at
all. I believe
that the best
hope for the
future is the
hybrid and
plug-in electric
hybrids.
JJC:
I agree with
you...
particularly the
plug-ins... SQM
is your lithium
play...
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[
end of final segment ]
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Go to the SUDDEN:DEATH
SEGMENT from
tonight's show
here >>
See current quotes on Yahoo!
Finance from
tonight's show stocks
here >> |
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Symbol keys: |
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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 >> |
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Thumbs up - indicates
he would buy the stock or,
at the very least, not sell
the stock. We do our
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opinion on stocks, as we
think it is indicated by his
comments during the show.
Please read his comments to
decide for yourself. |
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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
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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. |
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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. |
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Definitions of key phrases
used by Jim, known as
"Cramerisms": |
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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... |
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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. |
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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). |
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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. |
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See more
"Cramerisms" & other
financial phrases
here >> |
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Helpful Websites: |
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See the stocks currently
known to be in Jim Cramer's
Charitable Trust at:
jim-cramer-charitable-trust-stocks.com |
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See the stocks currently
known to be in Warren
Buffett's portfolio
of
stocks at:
warren-buffett-portfolio.com |
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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
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