Mad Money

Cramer: Street deserves ‘F’ for these stocks

Cramer's take on mis-valued stocks
VIDEO12:4112:41
Cramer's take on mis-valued stocks

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

Cramer always advocates doing your own research and drawing your own conclusions. This is why.

"There are times, such as now, when the market does a very poor job of valuing certain stocks", Cramer said. If you followed Street sentiment you might have avoided a number of stocks, and, in turn, missed out on opportunities to make money. "Let me give you some examples," he added.

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Boeing

"For weeks now, Boeing has slid into the abyss of being the worst stock in the Dow Jones industrial average," Cramer noted with pros worried that political headwinds as well as the aerospace cycle presented challenges the company couldn't oversome.

However, during the, a kind of trade exhibition for the aerospace industry, CEO Jim McNerney effectively said that wasn't the case.

"He said, the refresh cycle was flourishing and should continue to flourish because newer, light weight planes save fuel costs. And he said that the book to bill for orders is running ahead of last year's and he expects it only to get better," Cramer noted.

"The market gets an "F" on this one." Cramer said. "They just got the stock all wrong."

URS

Looking at Street research from only last week, Cramer found commentary which said, "URS was overvalued and should be sold because no one would ever bid for the company." Yet, over the weekend, , about an 8 percent premium over Friday's closing price.

Cramer could only say, "How stupid was the Street research?"

Citigroup

Largely Cramer said the Street turned its back on Citigroup, collectively deciding it was dead money.

"Then, in a matter of days, it reported a very strong quarter, solved its Justice Department problem and turned Citiholdings into a profit center," Cramer said.

Again, the Street couldn't have gotten this stock more wrong.

Facebook

"Do you realize that last week we saw Facebook collapse under a huge wave of selling due to worries about a decline in user engagement leading to a potential shortfall in the upcoming earnings," Cramer noted.

However, "A week later the stock's up five from the low," Cramer said, with no quantifiable research confirming the worries.

Yet again, pros got it wrong.

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Cramer said the inaccurate Street sentiment extended to Gilead, Whiting Petroleum, and Aloca too, with pros, again, failing to recognize that each of these companies also had positive catalysts at work.

All told, Cramer said, the preceding developments should remind individual investors that it's entirely possible to outperform the professionals. If you do the proper research and believe in your stock picks, Cramer said, stick with them. If Street sentiment turns against you, don't panic. As you can see from the examples above, there's a good chance you're right and the pros are wrong.



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