tv Mad Money CNBC January 22, 2013 6:00pm-7:00pm EST
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time trade time. mike khouw? >> freemort is as cheap as it's been in five years. use calls to press your bullish bets. >> tim? >> tsu. >> guy? >> blackstone, i think will it continue to be a great story. >> karen? >> mhp. liked it for the tweeter. liked it overall. >> pete? >> the beta trade continues to be research in motion. it's going higher. i think you have to switch over to the options. >> all right, thank you so much
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for watching. see you tomorrow for "squawk on the street" and "fast money" here again at 5:00 p.m. in the web extra, by the way, tweets for tim and pete get answered. meantime, don't go aim i'm jim crimmer and welcome to my world. they are jr are nuts. "mad money," you can't afford to miss it. i'm cramer, welcome to "mad mone money". welcome to cramerica. call me.
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this week started off with the dow advancing 4.72%. i know companies and i know what to look for. when the biggest and well-known companies report the process is still mistified. i have to tell you what, this morning ver rverizon reported, so important, whether it be the hook ups or the subsidyies, thi quarter is immensely important. i shoot an e-mail out that says
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that i think it is important. stephanie comes back in stan tainiously, they is focused on it too. writing, 7% hit from sandy, big numbers. the stock is down 30 cents. so i renew my efforts. find my something, what is wrong with verizon. i don't see it. find me what is wrong. nothing. just the questions with the margins. it is kind of unoable. and then i'm over across the street. it was a much worse than expected quarter. verizon eps misses leads the vz tombstone. so it is natural that the gang
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come to me and asks me what i thought. i don't know. in earnings season fine doesn't cut it. the stock is either great or bad, a or sell sell sell and a shortfall is bad. all of this mind you is coming in a total vacuum. what is left after the cost is selling the goods, we don't know. yet the stock is trading heavily and all downhill. so i guess it is really bad. pretty much intimate that by the time the morning begins. the stock starts to trade higher. the cfo has told the people that i can't hear that the company is confident that the margins will
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improve. cell phones, as you know, if you bought one are heavily subsidized and bangs the margins down. after all that, verizon starts to trade higher from the get go and stays higher. it was a huge one day move for the stock. how about johnson and johnson? here is one where the earnings are better than expected. wait a second. the guide streams over but the street is at $5.49. it starts to sink like a stone. it is just incredible. down 80 cents from the close. for me, the j and j is the
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breakup story. the stock flashed right back up for where it was on friday. we bought the stock and flipped it. finally, best and wildest for last. dupont, which it disappointed last quarter. it came out with a st txstellar number which looked like a major come back. ♪ hallelujah >> it came out by the commodity of whitener. the pricing had collapsed when chinese demand diminished. dupont means something. she told me stop it. stop worrying.
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because we don't know what the forecast is going to be and we won't know until the conference call. we can't know. meanwhile, ellen coleman appears on our own show and says i think 2013 is setting up to be a cautious year. how will the us economy respond? she goes onto say the definite needs to be dealt with in a matter of months. back to stephanie again. she tells me that all anyone is doing is focused on the numbers in lat tip america. so a stock that has been sinking goes flying up.
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it ends up being one of the best performing stocking. again, a huge move for this one. believe me, if these were isolated examples i would be fine with them. but there are so many like this, you can see why all of this trading is fraught with calamity and chances for you to lose money with every twist and turn. i sure liked the look of ibm and google earnings and i liked the way the stocks traded after the close. until i hear the conference call myself, i am not going to pronounce them as terrific. i'm goi ining to say come on ji. >> how can you blame me for not wanting to pull these quarters apart myself? do the analysis myself?
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my charitiable trust, it is not idle chatter when i say these are the worst times of the year to try and make money. even if the data points are meaningless or wrong. please, stop, look, listen before you take action. that is if there is any action to be taken at all. dave, in maryland dave? >> hello jim cramer, a big fat d baltimore raven's booyah. i think that is great. go ahead. >> as we know, at&t and verizon announced that they are going to record huge non cash charges related to their pension. >> this is a bernanke function.
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that is just the way it s the answer it is not what we should betrayeding off trading off of. stop, look, listen. that is our motto. there is too much noise out there. too much information could lead you in the wrong way. "mad money" will be right back. coming up, as the market hits new five year highs, cramer is finding out if the bulls can continue their stampede when he goes off the charts and later, take over target. 2013 kicked off a slew of acquisition announcements. it could be the missile you need to sky rocket higher. plus packaging power.
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food, fashion and phones whatever you consume comes in paper and plastic. two names you never heard of. find out which one could have profits you probably have. just ahead. coming up on "mad money." don't miss a second of "mad money." follow at jim cramer on twitter. send jim an e-mail to madmoney@cnbc.com or call us. miss something? head to madmoney.cnbc.com. ♪
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break out. tonight we are going off the charts to see what is going on. carolyn borodin. fabulous technician who happens to be my colleague at the street.com. although she belongs in buckingham palace. she has nailed this market. over and over again she has gotten the direction right. with a level of accuracy i find down right disturbing. she called it back in september and told us she was drawing a line in the sand and we would get pounded. sure enough it fell after the election and we did get pumme d pummeled. but most impressed me was what she told us on november 20th. when everyone was ready to freak
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out at that moment, at that chicken little moment, when all the worry warts were out in full force she told us to stop worrying. she sent me this, holy cow, this is out of sink with what we were thinking. at the time. the s&p is at 1387. now it is at 1492. in short, brodin nailed a 100 point move. in two months what a great grab. look at that. she nailed that. i might be a charrist, but the charts don't have emotions. they aren't about the fiscal cliff. it is totally working this market. so i have to go back to the well. what can i tell you, we want to know what the queen thinks it
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could go next. take a look at this chart. the s&p said it would. and totally there after. she told us that the low was likely to be pivotal. as a key part of her methodology. these numbers are 23.6%. 38.2%. and 69.1%. it is erie and according to many technicians it is a crucial inte turning point and you apply the rish yos that i mentioned and there is always an important level for that security. the s&p was ready to roar and she gave us a price target of
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1510. she said that if the s&p could break out it would be a straight line straight shot to her 1510 target. sure enough, i went back to her for info. so what does she think about the prospects right now? since it took out the key high it made before the big end of the year sell off, brodin thinks we might need a new higher upside target. and right now she thinks that is very likely than she said the next stop could come in the 1551, to 1555 area. we would be going like this, okay? why there. that is the next level. which is the key to brodin's
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method. june 4th low 100% that gets you to 1515 one. and 161, remember these are the numbers, 161.8% extension of the swing to the mid november low that would take it to the high. all right. brodin sees the next step higher as being somewhere in that area. she nailed this, she nailed this and this. i don't know. anyway, hey, it is something that came into my head. it was not meant to be sexist. it came into my head. things happen like that. if you check out the weekly chart. people think i'm brett musberge
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rext here. on the weekly chart, brodin sees more relationship that is overlap with her new price target. there are price relationships running from 1551 to 1563. now brodin says that these clusters can work as a magnet. the s&p can be drawn to the levels in one place. that said, brodin recognizes that this market has had a major run are. so she wouldn't be surprised at all if we get hit with a nasty direction. the next stop is 1555. i like her bullness surety. if we have one of these sell offs, we have a buy, buy, buy. if the s&p breaks down with the
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critical low it made in november, but, you know, i have to tell you, i'm sorry, that would be almost a 10% decline from where we are right now. as long as it holds above that level. but the market won't quit. and if you believe the charts as in interpreted as brodin, it could have an upside before the market is done. brodin has gotten the ticks and terms of the market right so many times that i have to give her some serious kudos. after we get to 1510, next stop 1555. what a run that could be.
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after the break i'll try to make up more money. >> coming up. 2013 kicked off a slew of acquisition announcements. don't miss cramer's play. it could be the missile you need to sky rocket higher. ♪ [ male announcer ] when we built the cadillac ats from the ground up to be the world's best sport sedan... ♪ ...people noticed.
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nothing. are you stealing our daughter's school supplies and taking them to work? no, i was just looking for my stapler and my... this thing. i save money by using fedex ground and buy my own supplies. that's a great idea. i'm going to go... we got clients in today. [ male announcer ] save on ground shipping at fedex office. now that we are almost a month into 2013 i think one of
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the trends for the new year will be an uptick in m and a. meanwhile companies are sitting on gigantic piles of cash. if they want to grow, the way to do it is by making acquisitions. cred consider the defense industry. we have earnings reports. the one thing you need to know is that everybody is worried about the budget cuts. the defense cuts by a couple of months. now they are wrangling about how to replace the cuts.
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this is not going to happen. i believe that we are going to spend lesson defense. that creates a tough dynamic and i thought about this. this is just an ongoing dilem a for this weekend. however, these companies do have a lot of money and their balance sheets are generally in terrific shape. if the big companies want to grow their earnings per share, the way to get there is by make making earnings in their business. if the defense contractors are on the prowl, what could be a smart takeover target that is worth investing, how about atk? this is a $2.15 billion company. so it is not that big it could
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be swallowed and even said in this report that it is a passeng potential acquisition candidate. it deals in led. it make s larger caliber ammo ad rocket motors to the new defense department. beyond that it has an ar aero se division. the company has a sporting goods division. along with shooting accessories. now whatever you think of guns
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or t or the stock we know that people are owni inin ining guns at new because they fear the legislation and if people are buying more guns they are buying more ammunition and accessories. the acts of senseless violence you have seen in the news including the one today, makes this a hard stock to talk about. i am asked multiple questions every day about the gun stocks. but i do understand that prof profiting on a military stock is a pretty healthy situation for that contractor even if it is bad for the country. i can see how this stock would turn you off. instead, if you want to make a
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difference. own the stock and then donate the stock to a charity of your choice. which is what i did with altria. i did give a lot of money away to fight what they do. because of a robust defense order and the need for defense companies to grow. i believe it is going to go higher. the latest quarter reported back in november was fabulous. 41 cent earnings beat. the company has a $6.4 billion backlog and had a ratio of 4.2 and management raised it's guidance. they boosted the dividend and that size dividend hike is a bullish statement by management.
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they believe the business is going to bget better. do you know that is the equivalent of 9% of the market? this is a serious chunk of what is traded. the shortage here is what is coming. they have a huge contract with the army. it could be worth at least $2 billion and they want to make a deal with the navy. they have ordered for the airbus for the military car goplane this is a defense business and one that is in excellent shape and only getting better. the fact is even though atk is at a 52 week high, i think the
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tock is cheap and it has become an underperformer so it is high now, but let's go back to the low in march of 2009. since then it has doubled more than 100%. but aliantech is trading at a 27% discount. while the stock has run over the last month, it is still at a depressed level and a larger defense contractor could snap them up. if aliant tech got taken out, the company would be valued at $6.3 billion over atk's current value. i'm not saying that the stock
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would double. but it looks very, very attracti attractive. but if the stock would trade up. it would be worth $72. here is the bottom line. it gives you multiple ways to win. i think it is an obvious take over target. but even without a takeover the defense business are in very good shape and i think it is too cheap to ignore. let's go to rick in florida, rick? >> how you doing sir, booyah from down here in or lan do. >> nice. that el estate market has come back. >> i mean this is a good producer and descent it is
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hovering around $48 for quite some time. but i have been noticing they are getting these contracts not just government entities and they have streamlined their acts. is it a good-bye? >> it is an exceptional buy. we featured this stock in 2009. november of 2009. i think this stock has many, many, many points that it could run. i would like to see the company take action and break itself up. i think you have a winner rick. i would own harris. >> dana in california, dana. >> i was hoping to revisit an old friend that you mentioned when obama was visit elected
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avar. it is find of traded in a range between 25 and 35. it goes down and back up again. >> yes, and what is interesting it, it has had a spotty earnings record. it has had that up and down pattern. i liked the company but i did not help people by recommending it. down here, i don't know. you would have to have conviction that the earnings can be very good. i expect 2013 to be full of m and a action. that is something that the defense sector could be concentrating on. without a pea ovtakeover, the ss very, very cheap.
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it is time for the lightening round. i want to start with eric. >> rh, what do you think about that? >> people don't like this stock and i do. i want to own it. it is something i want to buy more. let's go to jim in florida, jim. >> dr. cramer i presume. >> anyhow, i got a problem now disease and suddenly the stock has tripled in big volume. parkinson's a bad disease. you want to buy buy buy. ross in new york. >> i wanted to know your thoughts about this stock i invested in.
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>> k2 interactive. >> come on, man. i don't want you in that. >> i think you should sell it. >> peter. >> what is going on? >> okay. citigroup is okay. >> i'm not going to rave about it. >> and that is the conclusion of the lightening round. >> coming up, packaging power, food, fashion, phones whatever you consume usually comes in plastic. tonight, jim is unveiling two names you never heard of. just ahead. two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant
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♪ or help doctors turn billions of bytes of shared information... ♪ into a fifth anniversary of remission? ♪ whatever your business challenge, dell has the technology and services to help you solve it. on "mad money" we are searching for bull markets. not just the loud ones. the bull markets get a lot of media attention.
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sometimes the best bull markets are the ones that are under the radar. suddenly you look over and the stock you never heard of had a new high after a new high after a new high. i don't think anyone in the audience has thought about it. i'm talking about the market in packaging. the industry has been on fire. if you are a food company, you know that new companies can drive sales that allows the food to last longer. and in this business it comes down to two companies that you never heard of. bms, joked about to stand for buy my stock.
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and berry plastics group. which became public last october. ips down 5% on its last day. since then the stock became red hot. and if you go back two months, berry is up 25%. bhs has rallied over 10%. i think they continue to outperform courtesy of the bull market. buy buy buy. designing plastic containers doesn't seem like it would be a big business. but buy my stock has been van h vanishing from the low market commodity side of the business. what these companies do is sum up the idea.
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they develop bedder kin ede edes of packaging. they come up with new ways to package old products. here is a great example. you know these heinz dip and squeeze ketchup bottles where you can squeeze it out or pull the thing open so you can dip your food in it? the packaging didn't come out of the air it was made by bms. both of them are constantly developing new packaging technologies like the heinz dip and squeeze. th
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their main input costs are declining cre indramatically. paper, ink, aluminum, that is because there is not a lot of inflation. that is oolala. if you want to play the silent bull market in packaging. bms or berry plastic. this is one of those not so rare cases i definitely like both stocks. the real question here is not which one has the better buy. it is which one is more suited to the stock both have interesting characteristics. if i tell you that berry plastics have the most, they could go wrong, but very badly.
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it is a very conservative stock, excellent mix of clients and solid dividend, i have seen the stock yielding 3.5% people didn't recognize what was happening. the public became public and it became a dud and people fled from this thing. it only developed $14 and change. it is only a point and a half below the price. there is an opportunity here. now berry takes a tech or formal like approach. the company is an impressive rd operation. including a major design facility. where berry can create a prototype using that cool 3d printing technology approach in ape single day.
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something that should help the company win many more contracts we love 3did pri printing. now berry is already the number one or number two player. they have a terrific client lift kraft, nestle, procter. they have become a more profitable company. a tech company and on top of everything else, they have developed a revolutionary company and the cups that you probably drink your morning coffee out of. they were made of natural gas. for starters the company has a hideous balance sheet and of
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that $2.1 billion of the balance sheet, i think it can, the earnings will get a big boost. when you see a bounce like this one, i have to say it is a serious risk. the biusiness can guess worse ad there is another problem ap pol still has controlling interest. and it could crush the stock. these two negatives, despite having a 13.5% dproegrowth rate. however, it might be too risky for you. if it is, go with b mx s it is a leading player and has the highest growth rate in the industry. the company has been cutting costs in the industry.
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hillshire and hormell all gave positive commentary where volumes were headed and that is excellent for bms. this stock, it is not it's nnot -- you can sleep at night knowing the balance sheet is clean. here is the bottom line. the quiet bull market won't stay quiet for long. they are going to notice it. berry and bms, for a more conservative name. "mad money" is back after the break. >> coming up. it was the rant heard round the
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>> he has no idea what it is like out there. and bill pool has no idea what it is like out there. and they are losing their jobs and these firms are going to go out of business and they are nuts, ne athey are nuts they kn nothing. >> i didn't know it at the time i succeeded in getting the fet's attention after all. >> except it wasn't the kind of attention i sought. i became a laugh line. look, i certainly didn't intend to go ba lis tuck when i started. i was fairly subdued. i got going about how ben b bernanke knew nothing and how fed pool knew nothing.
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because we all know now that if the fed had cut rates at the time, we might not have had financial institutions go under. but i don't mention this to show how right i was or how wrong they were. although the cruel irony they were, i am confused to this day about how my contacts could have been so much better than their contacts. how could the feds not get it better than this one commentator? doesn't it say that it could happen? how could they get it so much more right than the fed did? i have some theories. for fear that it could haunt
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them in the fear of regulatory action. which even in the best of times, finally i cthink they speak to their own people. maybe the big shots like jeremy irons, the best movie made have wall street, even went out on the score. you don't rant every day, i was amazed that my cemey comments wt with instant issues. the feds never reached out to me. you would think that they would be more curious. in fact, before the minutes came out, the treasury secretary tim geithner acknowledged that they
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got it right and the fed got it wrong. but the bottom line is clear, all i really did was manage to bring a little levity to a clueless set of people who should have got it better. just like no one in the corrupt portion of the mortgage industry was ever pursued by the authority. no one had to pay a price for getting it wrong. he who laughs last, laughs best. stick with cramer.
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