FEATURED SLIDESHOW
Who Is The Worst CEO?Mad Money needed new inductees for its
Wall of Shame, so we asked viewers for
nominations.
RECENT POSTS
- Remorseful Regulator Leads Reform Fight
- Lightning Round: AT&T, Verizon, Novartis and More
- Lightning Round OT: Alcoa, Weight Watchers and More
- Why Amazon Rules Retail
- Nordic American: Sinking Ship or Titan Tanker?
- Cramer: What Monday’s Housing Number Really Means
- Cramer: Buy These Banks, If...
- Time to Buy Treasurys?
- Lightning Round: Las Vegas Sands, ADC Telecom, Satyam Computer and More
- Lightning Round OT: Knight Capital, Ebix and More
MAD MONEY FEATURES
PODCASTSWatch the Lightning Round whenever and wherever you want.
OFFICIAL MAD MONEY WIDGETGrab this all-in-one application and get recaps of the show sent right to your desktop or blog.
CRAMERS SOUNDBOARDAdmit it: You've always wanted to hit the "They
know nothing!" button. Here’s your chance.
CHECK OUT OUR PHOTOSCheck out Cramer on set, back to school, behind the scenes and more.
SHOP FOR MAD MERCHANDISEBuy Cramer books, bobbleheads and other Mad Money merchandise.
RING TONESPick up the phone! It's Cramer! New Mad Money sounds for your cell phone.
TEXT MESSAGE ALERTMad Money's mobile. Get show highlights sent to your phone.
Text Size 
Leadership may be hard to quantify, but it’s still one of the best reasons to buy a company’s stock. Just look at the way that CEO Jeffrey Bewkes has turned around Time Warner.
Cramer on Monday praised Bewkes, who took the reins in early 2008, for his focus on Time Warner’s [TWX
Loading...
()
] profitable cable TV properties and blockbuster movies. At the same time, he’s letting go of the money-losers: Time Warner Cable and the also-ran AOL.
The competition is fierce in cable delivery, as Verizon [VZ
Loading...
()
] and its FiOS triple play – cable, phone and Internet – extends its market footprint. That’s why Bewkes spun off TWC. And AOL, it seems, has been on the decline since Time Warner first made the mistake of merging with the online original back in 2001. With these two properties gone, the company that remains is much learner and more profitable, making it attractive once again to investors.
TNT, TBS and the Cartoon Network offer “endlessly re-runnable material,” Cramer said, and the accompanying ads pay for the shows “many times over.” CNN’s brand carries weight both on-air and online, the latter even on par with Yahoo! [YHOO
Loading...
()
] now that the Microsoft [MSFT
Loading...
()
] deal may have diluted Yahoo!’s search function.
And then there are the movie studios. Warner Bros. is number one with a 21% market share, and, in 2008, it broke the all-time record with $1.8 billion grossed. This year, Warner Bros. has at least two hits on its hands with The Hangover and the latest Harry Potter. Add in Castle Rock, New Line and even DC Comics and you’ve got a virtual Hollywood powerhouse.
The one wild card here is Time Inc., the publishing division. Time, People, Fortune and Sports Illustrated are all iconic magazine brands, but the industry is hemorrhaging money these days as subscriptions decline and ad sales dry up. We don’t know yet what Bewkes will do with this group, but Cramer seemed content that it had been “effectively cordoned off.” For now, Time Inc. is being treated like the legacy business it is, while the CEO emphasizes more profitable divisions.
Time Warner beat the Street’s earnings expectations when it reported second-quarter numbers last week. Revenues were weaker than anticipated, though, thanks to AOL and Time Inc. But the networks division was up 5%, and the company mentioned that the ad market was showing signs of stabilization. If ads recover, Cramer said, “you’ve got a $32-$34 stock here,” because networks accounted for 42% of the quarter’s revenues. Also, box-office sales were good, though DVD sales cut into the film division’s earnings.
Cramer said that the report offers “a pretty good picture of what this company will look like going forward,” and the better-performing businesses are exactly the reasons he’s recommending the stock.
“Time Warner is a company that reinvented itself,” Cramer said, “becoming an entertainment powerhouse” that he thinks is a “buy, buy, buy.”
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website?
Data is a real-time snapshot *Data is delayed at least 15 minutes