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Monmouth, Federal Mogul: Cramer Does His Homework

If you watch Mad Money regularly, you know that sometimes when a caller asks about a stock Jim Cramer tells them quite honestly he needs to do more work before he can form a thesis.

And he means it. Following is research and Cramer's resulting conclusion sparked by viewer questions about stocks.


Monmouth Corp

Back on January 18th, John in Virginia called in about Monmouth Corp (MNR), a real estate investment trust that owns industrial properties.

In the days since that question was asked, Jim Cramer hit the books.

"The company's got some high quality tenants including Anheuser-Busch, Best Buy, Caterpillar, Coca Cola, FedEx, Kellogg, Sherwin-Williams and Siemens," said Cramer. "Aside from the troubles at Best Buy, it's a fairly good list of stable clients. That said, over 40% of Monmouth's square footage goes to FedEx and its subsidiaries alone, which is an incredibly high concentration for just one customer. While Monmouth has a juicy 5.45% yield, I don't want to own any real estate investment trust that's so dependent on a single client."

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Federal Mogul

On Wednesday January 23rd Larry from Oregon raised a lot of interesting points about this stock. Since then, Cramer did some research.

Federal Mogul (FDML) is an auto parts maker that's a global supplier of powertrain and safety technologies.

Over the past year the stock is down about 45% although it popped 12% in only the past week in part due to a belief that the extreme cold weather in parts of the nation will help boost sales.

"Although the U.S. auto industry is on fire, Federal Mogul only gets 43% of its sales from the U.S., versus 45% from troubled Europe," said Cramer. "Also, it has a lot of debt on the balance sheet. I say let this one cool off from last week's big rally. If there's a turn here it's only in the early innings. I think we need to put on the brakes and curb our enthusiasm, at least for now."


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Symbol
Price
 
Change
%Change
MONMOUTH REIC
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FDML
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ABI
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BBY
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CAT
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KO
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FDX
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K
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SHW
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SIE
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