During the week of January 28, 2013, Jim Cramer made bullish and bearish references to 36 companies. He was bullish on 29 of the calls, or 80% of the time. For the week, the Dow reached an important 14,000-level. This is important, because the index did not reach that level since 2007. The S&P 500 rose around 0.7% while the Nasdaq’s ETF (QQQ) rose 0.99%. [More Cramer Lists: 3 Buys, 2 Selling Ideas from Jim Cramer, Week of Jan 21]
The rise in the down will invariably bring out optimists calling for more gains, and pessimists warning investors that there is pain ahead. The calls will add to the noise and the confusion in making a correct forecast. Investors must ignore the noise on both sides and pay attention to the measurements that matter: home prices in the United States, quality of earnings by companies, and hints that quantitative easing will end.
Like in the previous week, Cramer mentioned Amazon.com (AMZN) and SAP AG (SAP) again on January 30 and was positive on both companies. Amazon reported profit margins that were better than analyst expectations. The companies that also received favorable mention were Vale SA (VALE), eBay (EBAY), and Nokia (NOK).
Analysis and Discussion
Sell. The company is under scrutiny by TPG-Axon, with calls being made for investigating CEO Tom Ward. TPG-Axon wants shareholders to amend the company’s bylaws and to replace the current board. SandRidge responded to the allegations by saying: "The Board has reviewed issues related to these allegations several times over the company's history and has found no wrongdoing to have taken place. SandRidge dropped 6.4% for the week.
Sell. Clearwire is up by nearly 3-times from its 52-week low. The company did not accept financing yet from Sprint (S), which amounts to $80M. Sprint is offering $2.97 per share for Clearwire. Shares are up because Dish Networks (DISH) is offering $3.30 per share, albeit under complex terms.
Buy. Vale reported iron ore output rose 3.1% to 85.5M metric tons. Better weather conditions in Brazil and higher productivity at the Carajas complex helped Vale perform relatively better than its Australian competitors.
2. eBay Inc. (EBAY, Earnings, Analysts, Financials): Provides online marketplaces for the sale of goods and services, as well as other online commerce, platforms, and online payment solutions to individuals and businesses in the United States and internationally. Market cap at $72.06B.
Buy. The high-quality of earnings continues to be supported by the performance of PayPal, but eBay could be getting competition. Facebook (FB) is beginning to sell retailer gift cards. This could add pressure for PayPal. For now, the unit, and eBay’s core business, is solid.
Buy. Nokia appears to have peaked at above $4.50. Shares closed at $4.00, and dropped after its competitor, “Blackberry” announced the release of Blackberry 10. Nokia’s Lumia device is vying for growth in the corporate space, but Blackberry’s core strength in this space could improve over the next few quarters.
(List compiled by Chris Lau)
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Dig Deeper: Access Company Snapshots, Charts, Filings
- SandRidge Energy, Inc. (SD, Chart, Download SEC Filings)
- Clearwire Corporation (CLWR, Chart, Download SEC Filings)
- Vale S.A (VALE, Chart, Download SEC Filings)
- eBay Inc. (EBAY, Chart, Download SEC Filings)
- Nokia Corporation (NOK, Chart, Download SEC Filings)
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