Cramer Remix: Avoid stocks getting crushed by this
Cramer Remix: Avoid stocks getting crushed by this ·CNBC
Abigail Stevenson
Cramerica can credit Thursday's rally to the president of the European Central Bank, Mario Draghi. However, as the averages roared on, Jim Cramer became increasingly concerned that throwing in billions of euros to stimulate Europe's economy could cause problems for investors' portfolios.
It's the weakening euro that worries Cramer, and he thinks that the ECB-style quantitative easing could kill a lot of companies in the U.S.
Cramer saw that because of the lockstep nature of how stocks trade, a lot of stocks that should not have rallied on Thursday. As he listened to conference calls for companies reporting earnings this week, all he is hearing about is the moaning and groaning of CEOs complaining about getting crushed because it has become so hard to do business overseas.
"You don't need a weatherman to know the wind is blowing against these U.S. companies with lots of overseas exposure, especially in Europe," Cramer added.
These days, the stock market will not pay attention to stocks that even smell anything like oil. United Rentals (URI) delivered a 12 cent earnings beat from a $2.07 basis and higher expected revenues. However, that progress didn't matter, as the stock was slammed on Thursday.
United Rentals is the largest equipment rental company in the world that makes money by renting out equipment to construction companies, utilities, manufacturers, homebuilders and government entities. Unfortunately, this also includes renting equipment to oil companies.
Could this be a good entry point for the stock?
To find out how the turmoil in the oil patch has impacted United Rentals, Cramer sat down with CEO Michael Kneeland.
"We do believe that the low price of oil is going in to the consumer, and our economy is 70 percent consumer driven. It's a positive effect with housing, and that is going to trickle down to multiple industries including chemicals, which really benefit hugely on the fact that oil prices are low," Kneeland said.
Now Cramer is circling back to a company for a product that you probably used on your way to work this morning and isn't impacted by the low price of oil. Harman International Industries (HAR) develops, manufactures and markets high-end speakers for car stereos and infotainment systems that integrate navigation, media, safety solutions and smartphone connectivity.
It recently made acquisitions that could change the way you drive to work forever. The reason why the "Mad Money" host thinks this one is worth taking a second look at is that Harman announced two acquisitions: one with Red Bend Software and the other with Symphony Teleca.
Red Bend Software, acquired for $170 million, provides software management technology for connected devices. However, as the popularity of the driverless car has grown, so have concerns about cybersecurity hacks.
To find out more, Cramer sat down with Harman International Industries CEO Dinesh Paliwal.
The CEO explained that a typical mid-end to high-end car has 70 to 80 computers in it, none of which were designed to be connected to the cloud.
"Now you are starting to bring in good data and good intentions, but the bad guys are also eyeing it. They want to have a pile-up; this is like a terrorist attack. This is big mayhem waiting to happen, unless we do something," said Paliwal.
The "Mad Money" host has declared his favorite semiconductor stock for the year, and no, it is not riding on the coattails of Apple (AAPL) to flourish.
Cypress Semiconductor (CY) is a company that makes touchscreen chips for non-Apple smartphones and tablets. In Cramer's long tenure of investing, he has seen that semiconductor consolidation deals can yield big results for investors which is why he has declared it as his favorite. In December, Cypress announced a $4 billion merger with Spansion (CODE), another chipmaker.
Cramer advised sticking with Cypress Semi while waiting for the transaction to close because it sports a terrific 3.1 percent dividend yield.
To hear more about how the merger with Spansion will impact what the company has in store this year, the "Mad Money" host spoke with Cypress CEO T.J. Rogers.
"Emerging tech are startups. Investors should like startups because they bring breakthrough technology to market... But underneath the chip business which is the bulk of who we are now, is very healthy and the startups are going to be a big deal in the future. So we reported good results, with upside for the future," Rogers added.
While international banks are reporting difficult times lately, regional banks are a different story. Especially KeyCorp (KEY), which rallied up 7.6 percent on Thursday.
KeyCorp is a Cleveland-based regional bank that has about 1,000 branches spanning the Pacific Northwest, Midwest and Northeast. The company reported a strong quarter on Thursday that let the stock go for a run.
To find out what could be in store for the future, Cramer spoke with KeyCorp CEO Beth Mooney.
"Net interest margin really does reflect a lot about the interest rate environment, liquidity, where you're getting your asset growth. So, I do think a focus on growing revenues is probably a better indicator than margins," said Mooney
In the Lightning Round, Cramer gave his take on a few caller favorite stocks:
Anheuser Busch Inbev (Euronext Brussels: ABI-BE): "I like Bud because I like beer, but I have to tell you I'm a Constellation (STZ) man."
The Blackstone Group (BX): "The only private equity company I recommend is Blackstone. They delivered again, and they'll continue to deliver. They've got real smart guys and a lot of horse sense there."
