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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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...
. . . .
.
■
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)
Go to the LIGHTNING ROUND from
tonight's show
here >>
See current quotes on Yahoo!
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.
