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Jan.05
8:51 PM ET
Monday, 5 Jan 2009
Mad Mail: Is U.S. Steel a Buy?

Jim: Booyah, and go Eagles! Who would have thought that the market would rally and the Eagles would be in the playoffs? Just goes to show that sometimes both the market and sports don't make sense, but like a true Philly fan, I'll take both, no matter how ugly. I'm interested in your thoughts on BB&T [BBT  Loading...      ()   ]. I have a good position in my IRA portfolio (for the yield), but it looks like the Street is pessimistic about the performance of regional banks in 2009. I'm sure the dividend is safe, but do you think that BBT will prove to be the exception to the regional bank stigma? --Bob

Cramer says: “That’s how I’ve been feeling, Bob…all the bank stocks are under pressure. A lot of it has to do with the fact that people are very worried about the consumer defaulting. BB&T is a great lender. I am not concerned.”

          ___

Booyah, Jim!: You have talked a lot on your show about the damage that short sellers can do to a stock. I now look at the short ratios and short percentage of float, and try to avoid stocks where too many short positions are held or where the number of short sellers has been increasing. Should this be a part of my analysis, or am I on the wrong track here? --David

Cramer says: “I think what you have to do is…merge the short selling that happens in the ETFs, particularly the Pro Ultra ETFs, with your numbers in order to get a better look at what the real short pressure is.”

          ___

Jim: While I agree with you that Caterpillar [CAT  Loading...      ()   ] is a good pick, I think that many of the steel stocks are an even better buy. For example, I'm buying more U.S. Steel [X  Loading...      ()   ] any time I can get a decent drop. I missed it at $21, but in the recent past it was $196! Why won't X go back to $196? Considering the likelihood of infrastructure legislation, I would expect X to continue its excellent earnings per share. Buying and holding 100 shares of X in any portfolio seems like a good idea to me. --A

Cramer says: U.S. Steel has run to $40 from $20, so wait for a pullback before buying more. The same goes for Nucor [NUE  Loading...      ()   ], which jumped to $47 from $27. “We have to be price sensitive or else we just become bull market jokers.”








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