Microsoft's Right for Bear Market
Web Editor, "Mad Money"
When Cramer talked tech last year, he usually recommended faves like Research in Motion , Apple , Amazon and Google . They’re stocks that returned a tremendous amount of money to shareholders in 2007.
But we’re in a much different market than 12 months ago. Sell-offs caused by housing and credit woes are taking even the best names down indiscriminately. It’s getting harder and harder to find stocks you can trust.
The problem with the panic-fueled selling, though, is that many on Wall Street are overlooking some great companies. That’s why Cramer dedicated this whole week to finding tech names that can deliver no matter how bad Bernanke and the Fed perform.
Microsoft , his pick for Friday, might be a perfect example. Cramer called it a "battle-hardened company" that knows how to fight hard, play dirty and hunker down to make it though a slowdown. He even said that a slowdown could actually help the tech bellwether. As a tough economy forces smaller companies out of the market, Microsoft is there to scoop up their business.
Last quarter, MSFT beat earnings expectations by 6 cents, sales estimates by a billion and they offered upside guidance – a “perfect quarter” Cramer called it.
And on top of the fundamentals and pristine balance sheet – that boasts $21.57 billion in cash – there are some upcoming catalysts that could boost the stock: Windows Server 2008, Service Pack 1 for Vista and maybe even a bigger buyback with that pool of money Microsoft has.
Cramer urged viewers to get in MSFT before the company reports earnings Thursday, Jan. 24.
“Microsoft is the best tech stock for this bear market,” he said, “and don’t you ever forget it.”
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