Q:
You recommended
CEDC last April
and it's been
positive in my
portfolio until
last week.
They reported a
great quarter
and positive
guidance but the
stock is down
20%. Am I
missing
something?
I was hoping
that this is a
buying
opportunity, but
I am concerned
that there is
other bad news
that I have not
seen yet.
What is your
advice?
Jim:
I think it's
just
geopolitical.
Remember, we
recommended this
stock when we
first started
this show, then
we
re-recommended
it as part of
our central
Europe, Russian
stuff... and
Russia's gone
nuts. So,
there's some
political risk
here but the
business
itself... you're
absolutely
right.
Q:
The economy
seems to be
better than
people thought.
Fuel costs are
coming down, and
the rails are
getting
hammered.
What on earth is
that about?
It's insane!
Jim:
I
wrote a piece...
and I commented
about the fact
that the hedge
funds have
decided to
operate on the
rails.
They took them
down big today.
The pattern...
when the hedge
funds decide to
go after a
particular
group... is
that, day one,
it looks like
they're so far
low, you've got
to buy them, and
then they come
back and they
pound them, and
they pound them
again. I
think that there
is at lease 10%
more downside to
every one of the
rails. I
liked the rails
beginning in the
first week of
the show...
I cannot endorse
them here, now
that the hedge
funds are
operating on
them and going
to take them
down big.
It's what
happens... it's
ridiculous, but
it is what
happens.
Q:
Back in June,
you made an
example of
highlighting how
the "market" had
given us a gift
on NUE and the
secondary
offering priced
at $74. Since
then, the
company has
announced great
earnings and a
not-so-bad
outlook going
forward given
global growth
challenges.
The stock is now
well off the
secondary
offering price.
Should we
continue to
accumulate this
stock or is the
steel boom over?
It seems odd
that both
presidential
candidate are
talking about a
U.S.
infrastructure
stimulus package
next year, which
should be good
for steel, yet
these stocks are
collapsing.
Jim:
Let me tell you
something... Dan
D'Amico, who's
the unbelievable
CEO, laid out a
very strong
case, as did
John Smyrna from
United States Steel Corp.
(X).
These stocks
have all been
crushed as part
of a gigantic
retreat of
everything
cyclical.
My take is that
they've come
down enough, but
maybe I'm not
the good call on
this. I
liked them
higher. I
liked them lower
and I liked them
higher, because
I think steel is
multi-year... So
maybe you can
say, Jim,
long-term you've
been right,
short-term,
you've been
wrong. I
like the steel
group, because
they're not
putting up new
steel mills.
I think NUE is
good, but I've
liked it at $40,
and I liked it
at $60 and I
liked it at
$70... so maybe
my judgment's
questionable,
okay... I just
like them.
Q:
CLF and
Apache Corp. (APA)
keep getting
hammered because
of the oil
decline spilling
over into the
natural gas
sector, and it
appears that CLF
has been getting
manipulated
daily by short
players.
Their forward
P/E ratios
are fabulous and
I'm wondering
whether to hold
my positions
(which have
significant
gains) or do I
cash out some of
the profits at
this level?
Jim:
Remember, I said
CLF must be
sold, after they
bought that coal
company... they
announced that
deal. I
said they must
be sold.
You cannot own
CLF. I
made that point
even to the
local paper in
Cleveland.
I said you
cannot own it,
because they
paid too much at
the top of the
cycle for
coal... so
I do not want
CLF. APA?
There are other
natural gas
companies that
are now cheaper,
but CLF is a
no-no...
They're
overpaying in
order to block
their own
takeover.
Selfishness...
see you later...
sayonara CLF.
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. . . .
.
After this segment, you
can see Jim's
Sudden:Death picks
here...
. . . .
.
Jim's comments BEFORE the
interview:
Today was a good day for
gold... the stocks, not
the commodity... which,
once again, got rocked,
and is now hanging almost
around $800 bucks.
This is the first really
good day the gold stocks
have had, since the price
of gold began its
incredible collapse just
weeks ago. I mean,
it's really been
incredible... right about
the time when we pulled
Cramer-fave,
Yamana Gold Inc.
(AUY),
at $15 smackers... it's
now at $10. It
touched $9 intraday...
Now, is it time to get
back into gold, or is the
moment to sell into
whatever strength we have?
Here's the question:
What do you do with your
favorite gold company,
when the price of gold is
plummeting, and the gold
stocks are getting beaten
to a pulp?...
Our favorite gold play on
Mad Money, after AUY's
blown quarter, is Agnico-Eagle Mines Ltd. (AEM)...
It's a stock that I said..
should be sold, because it
had moved up too much.
Now it's come down hard.
Now it's up 6.6% today.
It's down 29% from when we
saw its CEO last, Sean
Boyd,
back on February 29th...
At that point, the stock
was at $68... but, of
course, gold was at $980.
That was literally $180
ago... It's just
fallen that, that badly...
Why?... Courtesy of
the strength of the (U.S.)
dollar... remember, a
strong dollar is the enemy
of gold... and a break in
the inflation fever
worldwide...
So, do we take this
opportunity to sell into
the meager strength that
we got today?... I
mean, there's a good case
to made that we should.
We've been doing a series
all week on the companies
that reported the biggest
beats - earnings beats -
during the season.
If we were talking about
the biggest misses, well
then I think we'd have to
mention AEM. It
earned only 9 cents last
quarter. The Street
was looking for
substantially higher
numbers. And this is
a company that seems to be
struggling with more than
just the plummeting price
of gold. AEM's cash
cost for the quarter for
gold were considerably
higher. 2008
production guidance was
reduced for gold... also
for zinc and copper, the
two other metals it
produces... neither of
which is faring all that
well at the moment.
And AEM's capital expenses
could increase 40% going
forward... at least
according to management.
So, leaving aside gold's
decline, should AEM be the
way to play gold?
Are there other ways to
play it? If AEM
can't find gold cheaply,
maybe we shouldn't even be
bothered with a gold
stock... Maybe we
should be doing what Jon
Najarian's
saying on Fast Money,
and buying
streetTRACKS Gold Shares
(GLD),
which is an ETF that
tracks the price of gold
itself, and then we don't
have to worry about
earnings misses of
individual companies.
And, given the new
deflationary environment,
is it even worth owning a
gold stock at all?
Let's find out...
Let's go back to Sean
Boyd, who is very straight
with us. He's the
CEO of
Agnico-Eagle Mines (AEM).
Let's see what he has to
say about these issues.
Mr. Boyd, welcome back to
Mad Money...
. . . .
.
Jim's comments AFTER the
interview:
Look guys, I've got to
tell you... this is the
best gold company. I
may even be willing to buy
the worst gold company
after this decline.
I think that if you
haven't bought any gold...
I've always said that
1/10th of your portfolio
is good to have it.
We left with
Yamana Gold Inc.
(AUY)...
We didn't have any gold...
I want to go back. I
think
Agnico-Eagle Mines (AEM)
is your man...
■
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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
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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.
