After this segment, you
can see Jim's
SUDDEN:DEATH picks
here >>
JJC:
If there's one thing I
believe in on this show,
it's accountability...
When I screw up, I own it.
And I own it on air...
typically in the most
embarrassing and
masochistic way
possible...
That's why I'm starting
something new this week...
This is "Accountability
Week" on Mad Money...
I'm running a new series
on big calls that I
blew... plays that I just
simply got totally
wrong... calls where I
stepped up to the plate,
and I whiffed...
And I am
pants-ing myself... I'm putting the post-it note
on... because
embarrassment is a
powerful friend of
performance...
Let's start with how I
whiffed on
Google (GOOG),
where I stayed negative
for way too long...
I missed a huge move in
this stock, after it
reported a great quarter
on April 17th... It went
from $449 to $594... Was
Cramer for it? Was Cramer
telling you, all
aboard?... No. Cramer was
saying (trainwreck
sound)...
How the heck did I
underestimate this stock,
that I had been so
correctly bullish on for
so many years?...
Let's break it down...
because there were certain
important things that I
missed... that the Street
missed... that I don't
want you to miss...
. . . .
.
My biggest mistake? I
relied on someone else's
work... I used this
third-party, independent
service called
comScore Inc. (SCOR),
which compiles its own
data, to judge who's doing
well on the internet, to
judge a stock...
comScore has yet to admit
that it screwed up
anything; they tell you
that everything's
fabulous... wrong!
Back on February 26th,
GOOG took a beating when
data from comScore
purported to show that
GOOG's paid
search/sponsored clicks -
that's their key
breadbasket - were down
7%.... down 7% in January,
compared to December...
down 0.3% year over
year...
Now that's just
catastrophic... I based my
assessment of GOOG on
these numbers. As it
turned out, they were
unreliable... as it
actually happened.
I stayed negative.
Everyone else did too.
They all looked at the
same data. But I don't
care about them. I care
about me. I got it wrong.
I own it...
When GOOG reported
earnings, the numbers came
out... and aggregate paid
clicks increased 20%... 4%
over the previous quarter.
comScore and Cramer could
not have been more wrong.
Again, comScore says it's
not wrong. Cramer doesn't
care. Cramer says I'm
wrong...
I relied on someone else's
work... my bad. Mega
bad...
. . . .
.
My next mistake is that I
compared GOOG to
Yahoo! (YHOO),
which I shouldn't have
done, because YHOO's so
poorly run... as well as -
after this weekend - a
disgrace! And a company
that never dealt in good
faith with Cramer-fave,
Steve Ballmer (i.e., CEO
of
Microsoft (MSFT)...
When YHOO does badly,
that's not necessarily
evidence that GOOG's doing
badly... what was I
thinking? It might be
evidence that GOOG is
crushing YHOO... Looking
back, we can see that it
just doesn't work to
compare these two
stocks...
Why? When you combine both
Yahoo and Microsoft - the
second-tier search engines
- they're only 14.8% of
the worldwide search
market.... Google's share?
62.8%... There's no
comparison...
. . . .
.
I also underestimated
GOOG's new revenue
streams. I thought it
would take them much
longer to monetize them...
I didn't know that they
were going to be that
fast, and that good about
it... I underestimated
YouTube... and, given how
many times my video with
(Erin Burnett... the "they
know nothing!" segment)
was aired, I'm really
embarrassed.
Right now, GOOG's in a
great position to
diversify away from paid
search, and into display
ads, now that it's
acquired DoubleClick...
There are all these
applications like GMail
and GoogleReader... These
are all making money! I
thought it would take
longer, so I whiffed and
missed the bottom on those
too...
. . . .
.
The fourth thing I did...
I missed the speed with
which GOOG's international
business would take off. I
thought the weak economy
in the U.S. would hurt
GOOG more than it did... I
wasn't giving the company
enough credit for
international growth and,
make no mistake about it,
GOOG is a
ROW-er... a company that
gets more than half of its
sales from the rest of the
world. We've been blessing
those companies left and
right... but I
misjudged...
International revenues up
14% sequentially, 55% year
over year... more than
half of GOOG's revenues...
In the U.S., revenues were
soft. I got that...
1.2%... 29% year over
year... But international
made up for the weakness,
and then some...
You know, GOOG is the
dominant player
everywhere, except in
China, where
Baidu.com (BIDU)
reigns supreme, and I
didn't give that enough
weight in my analysis.
This is a gigantic trend
and, no matter how
fast-growing GOOG is here,
it's even faster over
there.
. . . .
.
Finally... finally, I
whiffed on calling the
bottom because, look... I
misjudged how hated GOOG
had become... As of April
10th, a week before GOOG
reported its blowout
quarter, the short
interest was humongous in
this thing... it was way
up big... 2.1% of the
float.
Given how far the stock
had already fallen... GOOG
was down 45% from its high
in early November of
2007... a recent low of
$412 on March 17th... the
degree of hatred just
wasn't justified... Hedge
funds should have been
buying GOOG, not shorting
it... But I paid attention
to them. I thought they
knew more than I did.
That's why I whiffed on
GOOG, and missed the
bottom...
. . . .
.
Well, what do we do
now?...
I don't want to
underestimate GOOG again.
It's still trading at just
23.5x 2009 consensus
earnings of 25%... a
long-term growth rate of
28%...
If GOOG just traded inline
with long-term growth, it
would be a $697 stock...
17.2% higher than its
current price.
The stock just spiked...
not right. It spiked off
the YHOO thing. You've got
to wait for a pullback...
. . . .
.
The Bottom Line!:
Never let anyone say that
Cramer doesn't hold up his
mistakes, and punish
himself brutally. I
whiffed on
Google, Inc. (GOOG)
and missed the bottom. Now
you know why, and how you
can avoid the same mistake
in the future.
. . . .
.
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Second Segment
Final Segment
2 Title:
'Mad Mail'...
. . . .
.
Featured
Stock(s):
See comments below...
After this segment, you
can see Jim's
Sudden:Death picks
here...
. . . .
.
■
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)
na
na
na
Mad Mail
No specific
stock picks.
General
question...
Q:
You have
made yourself
quite clear
recently that
ethanol is not
the answer to
reducing our
dependency on
foreign oil...
I'm curious to
know why nobody
seems to be
talking about
using DDGS
(i.e.,
Distillers Dried
Grains with
Solubles) as a
feedstock to
replace some of
the demand for
corn. I've read
a few articles
that talk about
billions of
bushels of corn
that can be
displaced from
the animal
feedstock by
using DDGS.
What's your
take?
JJC:
We can't
reinvent the
wheel here. It's
not plausible.
It's not going
to happen... The
farm ag lobby is
behind corn - as
stupid as that
is - because
sugar would have
hurt our diet,
if they had
raised sugar...
It's just all a
big political
mess. I had a
guy in this
morning on
Squawk... who
was a defender
of his company,
an ethanol
company... I was
embarrassed,
frankly... I
should have been
much, much
tougher with
him, but it
wasn't my show,
and I was
guesting... and
I'm tired of
being the bad
boy, everywhere
I go.
Q:
You
talked about SGR
as a green play,
because of its
nuclear
business. There
is another green
aspect to SGR.
It's a different
shade of green
though... SGR
has an
environmental
division that
has contracts
for two huge
environmental
remediation
contracts on
rivers in New
York and
Michigan. They
also have
contracts for
cleanups for
landfills and
military bases.
They seem to get
a new contract
every month. I
guess you could
say SGR is both
"clean and
green."
JJC:
You're
absolutely
right... it gets
all those
contracts... be
careful... I
think
Chicago Bridge & Iron (CBI),
by the way, has
bottomed here.
The one thing I
would tell
you... I mean, I
was listening to
Obama... on Tim
Russert's show,
Meet the
Press...
Basically, he
said, listen,
nuclear is
dead... it's not
going to
happen... That's
always been my
worry with SGR.
SGR's got to be
international in
nuke because, in
this country,
we're never
going to build a
nuclear power
plant. It just
ain't going to
happen.
Go to the SUDDEN:DEATH
SEGMENT from
tonight's showhere >>
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Finance from
tonight's show stocks
here >>
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:
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...
FastMoneyRecap:
This site will be a quick
summary of recommendations
made by the great Fast Money
TV show crew, that will
offer you a unique service,
to compare their picks to
Jim Cramer's past comments
about those stocks.
