GO
Loading...

Cramer: Wendy’s downgrade and these others make no sense

(Click for video linked to a searchable transcript of this Mad Money segment)

Jim Cramer believes there's a lot of good information contained in most Street research. However, he's absolutely flabbergasted by some recent notes.

Cramer just can't understand the degree of skepticism analysts have in Wendy's, Honewell, United Technologies, KeyCorp and US Bancorp.

In most cases not only is Cramer optimistic, he's confounded by the downgrade because he believes the bullish catalysts are clear and apparent.

"That's what I felt when UBS started Wendy's with a sell. A sell? Come on man! This company is now under the leadership of Emil Brolick, a Yum Brands veteran, with the help of large shareholder Nelson Peltz," Cramer said.

If anything Cramer thinks Wendy's has considerable upside not downside.

Pali Rao | Vetta | Getty Images

"Wendy's is in the midst of a multi-year turnaround as stores all over the country get a great looking makeover with televisions and fireplaces and real nice décor. Who the heck would get off this horse now? The sell call leaves me as cold as the burgers and biggie fries leave me hot.

Cramer also thinks Citigroup's downgrades of United Technologies and Honeywell miss the mark.

According to the research, (Although) "UTX and HON are broadly loved stocks with balanced earnings outlooks and both stocks should grind higher this year, the implied upside is not sufficient enough to have a buy rating at this time."

The analysts downgraded both stocks to neutral.

Cramer is outraged. He can't understand how the analysts missed some powerful tailwinds.

"Don't they know both are levered to the magnificent aircraft cycle that I think could go on another six years," Cramer said.

Also Cramer believes both companies have gotten aggressive in their attempts to remain competitive. "These companies have planted seeds, taken the tough cuts, built out infrastructure for the big turn, particularly in commercial construction."

Cramer is anything but neutral on both Honeywell and United Technologies. "I wouldn't be surprised if they had meaningful earnings growth, larger buybacks and even bigger dividends."

Cramer is equally appalled by the KeyCorp downgrade from Oppenheimer and the US Bancorp downgrade from Credit Suisse.

"These calls are absurd," Cramer said. "US Bancorp has above average loan growth, a diversified earnings stream and also trades below its historical average," Cramer noted.

And looking at KeyCorp "even after its 59% run last year, it still trades at an historic discount to its peers even though its much better than most, and it's a far superior bank to the Key that traded at $40 six years ago," Cramer said.

------------------------------------------------------------
Read More from Mad Money with Jim Cramer
Is this stock breaking out?
Cramer's painful stock mistake
New patterns could upend retail stocks
------------------------------------------------------------

All told Cramer thinks the preceding downgrades are far too negative and fail to take into account strong bullish catalysts that should drive shares higher.

"These analysts are falling all over each other to downgrade. I say take the downgrades with a grain of salt."

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com

Contact Mad Money

  • Showtimes

    U.S.
    Monday - Friday 6p ET
    Australia
    Saturday 8a, 1p, 7p SYD
    Sunday 12a, 1a, 8a, 7p SYD
    New Zealand
    Saturday 10a, 3p, 9p NZ
    Sunday 2a, 3a, 10a, 9p NZ
  • Jim Cramer is host of CNBC's "Mad Money" and co-anchor of the 9 a.m. ET hour of CNBC's "Squawk on the Street."

Mad Money Features

  • Grab the latest CNBC gear from the NBCUniversal Store!

  • Get a behind-the-scenes look at how Cramer formulates his investment advice. "Inside the Madness" is a column, which features e-mails and more with Cramer and his researcher Nicole Urken.

  • You’ve always wanted to hit the “Hallelujah!” button. Here’s your chance.

Mad Money Moments

Cramer's New Book