Unlocking Another 1,000 Points From the Dow
Here it is, the final segment of Cramer’s weeklong series on how he thinks the Dow will soar another 1,000 points by yearend. As of the market close today, the index was at 13,507.28. His prediction is 14,548 before the bell rings on Dec. 31. The only way it’s going to get there, though, is by the strength of its components. So he’s been analyzing each, one by one, to see where the upside will come from.
These are the final six stocks of the Dow 30. If you missed the first 24, you can read about them here, here, here and here. Cramer will try not to hold it against you that you haven’t been watching all week.
First up is Pfizer, a pipeline-challenged company that will be lucky if it treads water at $27 for the rest of the year, he says. Even the management changes announced this week aren’t that exciting.
Now that Procter & Gamble has fully digested Gillette, Cramer thinks the upside has dissipated. He was bullish on the stock early in the year but right now doubts it will climb past $64.
United Technologies surprised Cramer. UTX delivered strong numbers and has great ROW (rest of world) business even though he was bearish from the start. Now, though, with all divisions in hyper drive, the stock probably goes to $73 no problem.
Cramer admits he didn’t see the big picture with Verizon either. The FiOS initiative, triple play (cable, internet, phone) and strong management in Ivan Seidenberg have this company up 14% for the year. The stock could go as high as $44 before it’s done, but unfortunately that means investors missed the move in Verizon.
Whether or not Wal-Mart moves depends on a couple of things, Cramer says. Lee Scott needs to go, or new boardmember Allon Questom, who did a great job of turning around JC Penney , gets to work his magic. If he does, Cramer thinks the stock goes to $55. If not, it could meander to $50. He’s willing to split the difference at $52, though.
The Walt Disney Co., the last Dow component, has great management, consistent double-digit growth and a great film and TV schedule. The problem is the theme parks are vulnerable to the price of gas and might suffer if the cost per gallon rises. Cramer thinks it will sit tight for the rest of the year.
Bottom Line: That’s it – every stock on the Dow and Cramer’s opinion on it. Now, go out and forget the bad ones and consider buying the good.
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