Exxon Mobil six to eight months ago wasn’t worth consideration, Cramer said during Monday’s Stop Trading!, but “at this level I’m getting excited.”
He credited Exxon’s purchase of natural-gas company XTO Energy – “a move of brilliance,” he called it – for his change of heart. Exxon recognized the role that nat-gas shales will play going forward and now is “getting some growth after years of no growth.”
Oddly, though, investors are punishing Exxon right when that growth is kicking in. The trend lately has been to move away from natural-gas plays to those that deal largely in oil. But Cramer said these people are missing the big picture: that nat gas over the long term is cheaper, cleaner and more abundant in the US than crude, and Exxon’s taking that longer-term view.
“I think people don’t understand how powerful this natural-gas move really is in this country,” Cramer said, adding that he thinks XOM at this level is “an opportunity."
His only problem with the stock is that it lacks the yield support investors get from owning a company like Chevron.
Cramer also commented on Fannie Mae’s request for more money from Washington. After reporting a $13.1 billion loss for the first quarter, the government-sponsored enterprise asked for another $8.4 billion on top of the $84.6 billion it’s already received, The AP and Reuters reported. Cramer called both Fannie and Freddie Mac “catastrophes” but said that the action in stocks like Standard Pacific shows “the [housing] problem is under control.” These stocks were up today even despite news of Fannie’s request.
“That’s telling the truth,” Cramer said.
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