Cramer’s Homework: Less Familiar Stocks, but Less Attractive?
If you watch Mad Money regularly, you know that sometimes when a caller asks about a stock Jim Cramer tells them quite honestly he needs to do more work before he can form a thesis.
And he means it. Following is research and Cramer's resulting conclusion sparked by viewer questions about stocks.
Vishal in Nebraska called about Incontact, SAAS, a relatively small cloud based software as a service company in the call center industry. It's market cap is around $275 million.
"While I love how the cloud applications are transforming InContact's business model, I think it's too early to buy this stock right now," said Cramer on Friday. "The company has yet to turn a profit, and we need to see more execution on its cloud offerings. If you're looking for a cloud play, stick with Salesforce.com or SAP."
Albert in Florida asked about Textainer Group Holdings, the largest container lessor in the world.
"My concerns about this stock are two-fold: first, it has heavy customer concentration in a few large shipping liners, and second it's hurt by the declining global trade environment. Textainer may look cheap relative to its peers, but you have to steer clear of this stock until the fundamentals start improving," Cramer said.
Glenn in Illinois had a question about Celldex Therapeutics, CLDX, a speculative biotech with a market cap of $360 million.
"I'm mindful of the FDA's renewed focus on safety, but the data Celldex has reported so far has been pretty promising and the company has a rich pipeline to support its valuation," said Cramer. "I say wait for December 8, when the company will pass on data about CDX 011, its advanced breast cancer treatment. Right now the stock has run too much for me to give it my blessing, it's up 132 percent year to date, but if we get any significant pullback after that December 8 breast cancer data gets digested, I think Celldex could be worth buying into weakness."
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Jeff in Virginia asked about Hillenbrand, the largest producer of burial caskets in America.
"The stock has had a big move in the last two weeks after reporting a strong quarter and making a game-changing acquisition of Coperion Capital," said Cramer. "I like where Hillenbrand is headed and I like the 3.6-percent yield, but after this run, I would wait for a pullback."
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