Mad Mail: Why Isn't Focus Media Working?

Dear Jim: What am I missing here? Focus Media is at a 17 forward price-to-earnings ratio (per management's 2008 earnings-per-share estimate on earnings call), grew 80% 2007/8, with 70-80% growth expected again this year and 50%+ next year. Why the P/E and growth miss-match? Which one is wrong? --Laura

Cramer says: “Remember, the last quarter all they did was basically an inline quarter. And that just took all the air out of the stock. Plus, China’s viewed as being speculative. And this is not a market that’s kind to speculation. All that said, I agree with you. I would buy the stock right here.”


Dear Jim: My question is on MDU Resources Group. MDU just sent out their annual report and some of the highlights are the following; earned record 431.4 million, increased earnings per share by 36%, 10% total shareholder return, five-year annual total shareholder return 22%, increased common stock dividend 17th consecutive year. Is involved in natural gas, oil, construction material, pipeline and electric. I think it is a company that has a lot to offer. --Sandy

Cramer says: “I do too. A lot of the stocks in this segment have just been killed. I say stick with it because I like the end markets. But oil and gas has gone so out of favor in the past four weeks that I think you’ll still have to experience the house of pain before you get to the house of pleasure.”


Booyah Jim!: I picked up on Sigma Designs from your show. After looking at it very carefully, I decided it was a good buy. It is now down to a third of what I paid a few months ago. I still think it has good prospects for future growth, but I fear that competition could erode this company's position further, and the shorts are into this heavily. Any thoughts? --Kevin in Seattle

Cramer says: “This thing just blew up. And I still don’t understand exactly why it blew up. It did not report a great quarter, but its future’s great.” Cramer said he wants to recommend SIGM, but he’s “gun shy” right now.

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