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Investing can be confusing. Luckily, Cramer has mapped out some road rules for all you Home Gamers trying to navigate the jungle that is Wall Street. Think of it as "Mad Money 101" –- some fundamental advice to keep in mind as you play the market. Whether you're a first time investor or a seasoned financier, it's always good to remember the basics.
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Feb.08
6:58 PM ET
Friday, 8 Feb 2008
The Perfect Pitch

A couple of weeks ago, as part of Ladies’ Night on Mad Money, Cramer had the members of Smart Woman Securities – an all female investment club at Harvard – pitch him their best stock picks (watch the video). Now that some time has passed for him to do his homework, he’s going through each pick to declare a definitive winner.

Jane’s Pick: Flower Foods

Jane pitched baked-goods maker Flower Foods [FLO  Loading...      ()   ] to Cramer as a “no-brainer” that had outperformed the investment club’s portfolio.

While FLO was “right” for two weeks ago, Cramer thinks the stock is now a sell after spiking over 13% on an earnings beat in the face of rising wheat costs. The good news is baked into FLO, Cramer said, and the buyback it just announced is too risky for this environment.

Anastasia’s Pick: PharMerica

Anastasia was bullish on PharMerica’s [PMC  Loading...      ()   ] growth potential as a seller of bulk drugs to nursing homes.

Cramer conceded that PMC has the potential to grow but the company is too new and unseasoned for him to back it here. It’s too early to tell if it can execute and it isn’t worth taking the risk yet, he said.

Kayley’s Pick: Clorox

Kayley called Clorox [CLX  Loading...      ()   ] a defensive play for a tough market with great brand recognition and market share.

But Clorox is too exposed to rising raw costs to be worth owning here, Cramer said, calling this week’s Lehman Brothers downgrade of CLX “dead right.” The company might be too defensive for this environment and after lowering its guidance for 2008, Cramer just doesn’t see good things for the future.

Tracy’s Pick: EnerNOC **WINNER**

Tracy pitched Enernoc [ENOC  Loading...      ()   ], an insurance company in the electricity market that gets paid to provide protection during peak usage times that she called a strong buy in a growing electricity market.

Although it’s speculative, Cramer crowned Tracy’s pick the winner. There’s several ways to win with ENOC. It is a play on improving the reliability of the grid, it has an environmental angle as the company helps reduce energy consumption and it has the well-known venture capital fund Draper Fisher Jurveston as a backer.

The bottom line is that of the four stocks Smart Women Securities pitched to Cramer during last month’s Ladies’ Night, Enernoc is the one he would buy.


Questions for Cramer?

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