It’s Friday on Mad Money, and that means it is time for a game plan for the upcoming week. This week, Cramer’s got his eye on three things – two IPOs and one quarter.
Veraz Networks is coming public next week. This is a telecommunications-equipment and internet-infrastructure company that makes a lot of the infrastructure for VoIP (Voice-over-Internet Protocol). It’s set to IPO between $10 and $12, but Cramer would be a buyer up to $14. Some people are already thinking Vonage , the single worst IPO of 2006, when they hear VoIP. But Cramer says that’s short-sighted.
Vonage has been a disaster because it’s a retailer of internet phone service – and that’s just an awful business, Cramer says. Vonage isn’t evidence that VoIP is illegitimate. It saves a lot of money, but we still need the infrastructure. That’s where Veraz comes in. Some similar IPOs have debuted fairly recently: Acme Packet , Riverbed Technologyand BigBand Networks . All three traded very well in the aftermarket, and Cramer expects the same from Veraz.
The second IPO is Comverge, a company that makes on-site wireless devices that are placed wherever people consume a lot of energy. The Comverge devices are designed to shut down nonessential parts of the power grid if it becomes overloaded during peak energy demand hours. Utilities love this technology because it increases their profits, Cramer says. The idea sounds enticing, he admits, but he can’t endorse buying Comverge for a penny above $12.50, which is well below the current pricing (between $15 and $17). If the book-runners lower the price, then maybe Cramer will get interested.