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Cramer: Hewlett-Packard's Problems Are 'Severe'

Tuesday, 17 May 2011 | 3:13 PM ET

Hewlett-Packard's problems are so "severe," Cramer on Monday said he's not interested in playing its stock.

Stop Trading: Jim Cramer
CNBC's Jim Cramer weighs in on Hewlett-Packard's structural problems, precious metals and oil stocks.

The technology company slashed its 2011 profit forecast as it prepares to spend heavily to revamp a troubled division that provides everything from computer maintenance to high-level tech consulting. CEO Leo Apotheker, who took the helm in September, blamed the division's "missed opportunities" under his predecessor Mark Hurd. But being as these are "structural problems," Cramer said it doesn't matter who's at the helm.

Although the Palo Alto, Calif.-based company offers various technology products, Cramer said it's not involved in tablet devices and made the mistake of acquiring Palm. He's not impressed that it's getting into cloud computing, either.

Elsewhere in the market, Cramer commented on the breakdown in metals. Cramer said people are wanting to sell Freeport-McMoRan because it's down so much. He wouldn't sell FCX, though, because he thinks we're closer to the bottom than we are to the top.

Speaking of commodities, Cramer is bullish on Schlumberger . The oil and gas equipment and services provider has "structural things" going for it, he explained. Countries are spending money to produce more oil, including the U.S. President Barack Obama recently called for more oil production, which Cramer thinks will help SLB because it's levered to production. Cramer also noted that these are long-term projects, allowing Schlumberger to better gauge its business prosects going forward.

—Reuters contributed to this report

Call Cramer: 1-800-743-CNBC

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