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Tuesday, 05/13/08
Posted 05/13/08, 9:51
pm ET |
(Scroll down to see Jim's
comments below) |
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Today's date:
Tuesday, 05/13/08 |
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Dow Jones: |
12,832 |
- 44 |
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NASDAQ: |
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2,495 |
+ 6 |
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S&P 500: |
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1,403 |
-
1 |
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Opening Segment 1
Title: |
'CEO Interview'
Robert Toll, CEO |
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. . . .
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Featured Stock(s): |
Toll Brothers (TOL)
See TOL's official
website
here.
See the Yahoo!
Finance profile for
TOL
here.
See Opening Segment 2,
below...
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After this segment, you
can see Jim's Lightning
Round picks
here... |
Jim's comments BEFORE the
interview:
On tonight's show, we're
taking the pulse of this
nation's economy... with
two important CEOs... and
one is at the pinnacle of
the housing business and
then, after the break,
another CEO, who has to
cope with these
ridiculously-high energy
costs, as the largest
consumer of energy in his
business...
I want to know, how are
they, and how are they
doing?... And how
are we coping as a nation,
with the two strongest
headwinds I have seen,
since I started trading
stocks in 1980... the
housing crash, and the
skyrocketing price of
energy.
My first guest is Bob
Toll... He is the
CEO of
Toll Brothers (TOL),
and a remarkable man.
Why? Because, when
housing was bad, he said
it was bad!... This
man is the Diogenes of the
housing business.
Now, you know we've hated
the homebuilders for a
long time on this show...
You know that I think
they're a part of the
problem, when it comes to
the current financial
mess. They keep
pumping them out...
But, on the other hand,
I've long realized that
it's too late to sell
homebuilders...
They're up for the year.
Right now, we're waiting
for a bottom in housing...
We have gotten a bottom in
the housing stocks.
We're waiting for the
right time to be able to
say to you, not only have
they bottomed, but we can
make money... because,
when the bottom comes for
the homebuilders, that's
going to be the bottom for
everything else.
House price depreciation
is the linchpin that's
driving this country down.
If we get house price
appreciation, it is
hallelujah... But,
if we get stabilization,
we're on the road to
recovery...
Now, TOL - which is one of
the high-end... well, I
think the best of the
high-end homebuilders - is
a little less vulnerable
to some of the
vicissitudes of the
economy. It reported
today. The company's
quarterly sales came in at
$818 million. That's
about $60 million higher
than expected...
Remember what we're
looking for here... we
want to work off excess
housing inventory... to
spot the housing market
bottom. From these
results, I can't say how
close we are to the
moment, but it looks like
we're closer... We
definitely want to get a
better feel for this, as
the housing industry is at
the core of our domestic
woes...
So, we're really lucky to
have the Diogenes of the
homebuilding business, Bob
Toll, the CEO of
Toll Brothers (TOL),
here tonight via
satellite, to help explain
his company, and where the
industry is right now.
Mr. Toll, welcome to Mad
Money...
Jim's comments AFTER the
interview:
Bob, thank you for being
honest the whole time. You
have kept my show even
keel, because you know
I've talked to you behind
the scenes, and you've
urged me not to be
bullish... I want to thank
you, and all the people
from Mad Money want to
thank you, because I have
never once gone off the
deep end and said that
it's a great time to buy,
because of the work that
you've given me.
All right... you know how
much I want to be
bullish... Look, it's not
yet... it's not yet. When
it gets to the right
level, you know I'm going
to come to you and I'm
going to pull the trigger.
I did not hear sell, sell,
sell.... but I sure did
hear don't buy, don't
buy...
. . . .
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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) |
|

|
TOL |
23.27 |
na |
Toll Brothers (TOL)
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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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Opening Segment 2
Title: |
'CEO Interview'
Albert Stroucken, CEO |
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. . . .
. |
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Featured Stock(s): |
Owens-Illinois, Inc. (OI*)
See OI*'s official
website
here.
See the Yahoo!
Finance profile for
OI*
here.
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|
After this segment, you
can see Jim's Lightning
Round picks
here... |
Jim's comments BEFORE the
interview:
I'm returning to my
99-bottles-of-beer-on-the-wall
play... and you remember
what it is... It's
Owens-Illinois (OI*)...
the largest maker of
containers... glass
bottles... in the world.
I recommended this stock
back on March 18th... It
was at $53 bucks. It
went up to our target to
around $61 immediately.
But it's come back down to
where I recommended it.
Let me tell you... OI*,
around $55 or under, is a
gift...
I originally recommended
this stock as a play on
the fact that glass
bottles are replacing
plastic ones, because
they're far more
recyclable than plastic,
and emit far fewer toxins
when you make them.
Here's the thing...
The reason I believe OI*
is such a steal at this
price... between when I
recommended it, and today,
the company reported a
blowout quarter. In
other words, I told you to
buy it... It then just
does a miraculous
quarter...
OI* raised its free cash
flow guidance from $425
million, to $500 million.
Believe me, that is a huge
increase, okay?...
And, even though volumes
were lower than
expected... pricing was up
7%...
I said this was a play on
higher glass prices, and
what do you know?
That's exactly what
happened...
I thought this was a great
quarter. The market
disagreed with me...
Now, part of this was that
it had the bad luck to
report at a lousy time for
the market... but
there are bears circling
the stock... they're
worried about energy
prices... roughly 20% of
the company's input costs.
OI* increased its
expectations of cost
pressures in 2008 from the
$250-300 million range, to
the $300-375 million
range. Input costs
may be up, but so are the
prices OI* is charging for
its bottles...
They're way up way beyond
what the Street expected.
I still like the stock.
I've been buying it for
my charitable trust... but it
looks like a lot of people
are spooked about these
input costs... so we've
got to resolve this...
To give investors an idea
of what's really happening
at this company, we've got
the CEO of
Owens-Illinois, Inc. (OI*)
- one of the great
turnaround stories that I
have seen in my
lifetime... Albert
Stroucken, right here in
the studio today...
Mr. Stroucken, welcome to
Mad Money...
Jim's comments AFTER the
interview:
Mr. Stroucken is the CEO
and chairman of
Owens-Illinois, Inc. (OI*),
which I think is a green
play, and a terrific play,
on the growth of the rest
of the world...
. . . .
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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) |
|

|
OI* |
54.21 |
na |
Owens-Illinois, Inc. (OI*)
Price target to buy:
$55.00 or under.
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Go to the LIGHTNING ROUND 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
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. |
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Thumbs down -
indicates he has said not to
buy or to sell the stock,
based on his comments | | | | | | |