Cramer's Rants / Stockl's Lemons

[diogenes]

Shorting Cramer

From the link:

"Abstract:
We document market inefficiency in the in the days following the buy recommendations of Jim Cramer, host of the popular CNBC show Mad Money. The average cumulative abnormal overnight return for the smallest quartile of recommended stocks is 5.19%, and these returns completely disappear within 12 trading days. We also find that trading volume, buy-sell imbalance, and short sales volume are all significantly higher than normal on the day following Cramer's recommendations. These findings allow us to test hypotheses about the behavior of different types of traders. Finally, our GMM estimates of the components of the bid-ask spread suggest that market makers are aware of Cramer's recommendations and anticipate the order flow imbalance following Cramer's recommendations."

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=870498

[billyjoe]

Cramer 7/13/06

Buy stocks in sectors that have a defense in this bad market. These will have strong dividends , buyback history, or strong possibility of being taken over.

Regional banks : SBCF HCBK dividends and share buybacks

Utilities : CPK BKH IDA CNA dividends and takeover targets

REITS : RA BDN preferably office space , not malls , strong takeover targets


Cramer Likes : NBR HAWK CSX

Cramer Hates : USB HELE

--------billyjoe

[Lyehopper]

From the link:

"Abstract:
We document market inefficiency in the in the days following the buy recommendations of Jim Cramer, host of the popular CNBC show Mad Money. The average cumulative abnormal overnight return for the smallest quartile of recommended stocks is 5.19%, and these returns completely disappear within 12 trading days. We also find that trading volume, buy-sell imbalance, and short sales volume are all significantly higher than normal on the day following Cramer's recommendations. These findings allow us to test hypotheses about the behavior of different types of traders. Finally, our GMM estimates of the components of the bid-ask spread suggest that market makers are aware of Cramer's recommendations and anticipate the order flow imbalance following Cramer's recommendations."

http://papers.ssrn.com/sol3/papers.c...ract_id=870498

Very interesting.... I'll be watching your POTW short play tomorrow dude....SsSsSSssss!

[diogenes]

Very interesting.... I'll be watching your POTW short play tomorrow dude....SsSsSSssss!

If would have been wonderful, but with only one day to play it I chickened out and went back to cash.
Now, next week it might be fun.

[billyjoe]

Cramer 7/14/06


Taking advantage of retiring baby boomers travel and leisure activities. Many of these retirees will pay a premium for services that enhance their image. These are the best of the "high end" companies that cater to the wealthy or faux wealthy retirees.
FS---luxury resorts and hotels in 31 countries, 50 properties, 17,300 rooms
OEH---deluxe hotels 50 throughout the world
BKS---799 bookstores in 50 states barnes % noble % b. dalton
AXP-- in 130 countries , you pay for using their card

Best in gambling
LVS-- operate in Macau only legal casino location in China
IGT-- computerized machines , control nearly 2/3 of American slot machines

High dollar restaurants
MRT-- 70 steakhouses in 28 states and Canada
RUTH--95 locations worldwide

Luxury Liners
RCL
CCL
Cramer hates : CBRL

---------billyjoe

[billyjoe]

Cramer 7/17/06

Checklist to determine whether to keep or sell a stock that is down.

1. sector : is it in a bull mode or a bear mode

2. is it cheap in relation to S & P 500 (p/e ave.16) you can also check trailing earnings, forward earnings, price/ book

3. is management stagnant or forward thinking . How's their track record ?

4. how does the future look for their product ? Have they oversaturated the market ? Are they already in all 50 states ?


Cramer Likes : NBR LOW SWY NKE ABB WHR BA

Cramer Hates : EBAY HD BWNG IRM DD CMED HW

Nothing new from stocklemon or sharesleuth.

-----------billyjoe

[billyjoe]

Cramer 7/19/06

Today's rally was because the market was oversold. A herd mentality is running the market. High volume is needed to continue rally.

Four factors to use in picking superior industrial stocks.
1. do they supply or operate in the BRIC countries (Brazil Russia India China)
2. are they heavily effected by bull markets
3. do they see a bright future for themselves ( especially if they raise guidance)
4. are they actively buying back shares

UTX is one of those industrials that satisfies all the above requirements

Cramer Likes : BA UTX WFC GW MOT NBR UPS SHLD ERTS

Cramer Hates : AVCT PQ BIDU YHOO WM EMC

----------billyjoe

[Rob]

Billyjoe, I noticed EBAY conspicuously absent from Cramer's hate list toaday, as opposed to Monday. LOL @ that bald-headed stooge!

Billyjoe, seriously, thanks for the recap, dude.

[mrmarket]

From the link:

"Abstract:
We document market inefficiency in the in the days following the buy recommendations of Jim Cramer, host of the popular CNBC show Mad Money. The average cumulative abnormal overnight return for the smallest quartile of recommended stocks is 5.19%, and these returns completely disappear within 12 trading days. We also find that trading volume, buy-sell imbalance, and short sales volume are all significantly higher than normal on the day following Cramer's recommendations. These findings allow us to test hypotheses about the behavior of different types of traders. Finally, our GMM estimates of the components of the bid-ask spread suggest that market makers are aware of Cramer's recommendations and anticipate the order flow imbalance following Cramer's recommendations."

http://papers.ssrn.com/sol3/papers.c...ract_id=870498

I think Cramer stimulates interest in the markets, which is a good thing for seasoned investors.

[RL]

I find Cramer to be no different than all the other analyst that we hear and read about every day, except he puts on a good show and makes things a little more Interesting and adds some humor. Although he recommends stocks he also adds that you should do your own homework. I have never bought any of his recommendations as they seem to go up and then sell off In a couple of days

[billyjoe]

Cramer 7/20/06

Buy banks now while they're still cheap 5 reasons why :

1.) They are buying back stock in record numbers

2.) New bankruptcy laws are good for banks

3.) On average are priced below S&P multiples

4.) Even after 17 rate increases banks have fewest loan losses in years

5.) Fees are making banks $$ reducing dependence on money from loans

Cramer Likes : MTU PFE UL FUN CWTR

How to spot a bad analyst call : Macrothesis downgrading of an individual stock based on slowdown of the sector as a whole is often wrong. Calls made within 48 hours of earnings which seem to be motivated by unexplained inside information is usually wrong.

--------billyjoe

[billyjoe]

Cramer 7/21/06

This is a stealth bull market. Many companies are doing great but no one notices them with all the bad news. The roadbuilding industry will do well when the pork contracts (politicians) finally come through. The best ways to play this industry is through rock companies that produce aggregate , asphalt , and paving equipment. The best of these companies are :

crushed rock aggregate---VMC MLM

asphalt-----ALJ

paving equipment---IR ASH

Cramer Predictions : Fed will lower rates before elections , shorts will rule Monday 7/24/06 followed by a rally

Cramer Hates : HANS

Cramer Likes : NWS , Banks , Drug Stocks

----------billyjoe

[Rob]

This is a stealth bull market. Many companies are doing great but no one notices them with all the bad news.

I saw that, Billyjoe, and I gotta tell ya, I'm in Cramer's camp on that one. All these panty-waists selling good companies on the cheap need to take a good look at reality for a change.

[spikefader]

...panty-waists selling good companies on the cheap need to take a good look at reality for a change.

Forgive me if I've read that statement incorrectly or defensively, Rob. But I see two problems with that "panty-waist" adjective.

a) it's unfair and sexist to suggest that anyone who happens to be wearing panties (hopefully ladies only jejeje) can't trade effectively and make money or limit losses selling those so-called "good companies"
and
b) it implies that selling or shorting so-called "fundamentally good companies" is "ineffectual", despite the repeated evidence of late to the contrary.

As I see it, technically weak stocks should be sold to limit losses. They should be shorted to increase profits.

Either way, the bottom line is that if it's a choice between producing the goods and being called a panty-waist it's a no-brainer - give me the label!

It has nothing to do with gender. It has nothing to do with fear. It's not personal.

But it has everything to do with reality, what really is, or might be, and admitting that some things occur for reasons beyond the fundamental.

Have a great weekend dude!

[Rob]

You know, Spike, I was afraid you or somebody might take that personally, and I almost didn't post it because of that. I like T/A pretty well, but within reason. I was just puffing out my chest and blustering because I agreed so whole-heartedly with what Cramer said on his show tonight about good companies being sold cheap. And when I used the term "panty-waist," I was not thinking of anyone on this forum, mainly just ticked off that institutional investors keep selling and selling when there's no good reason for it--like a bunch of "girly-men." And I mean no offense to any of the fairer gender by that comment either. It's just me blowing off a little steam.