Segment 1: Investing in Chile
Cramer has two great Chilean stocks for us tonight, because the country has been growing at a rate of at least 3.5%, and he thinks that at least 20% of your portfolio should be invested overseas. Cramer's first recommendation is Banco Santander Chile (SAN), which is a financial that acutally makes money. Cramer likes it because it is used by investment banks and mutual funds who want to get exposure to Chile, it has a 4.7% yield, a growth rate over 10%, and a lack of competition because there are regulatory roadblocks to opening a new bank in the country.
Cramer took phone calls on the following stocks:
U.S. Bank (P): The caller asked about the preferred stock, and Cramer said to go with the J.P. Morgan (JPM) preferred or common stock instead, though he likes preferred stocks in general because of their yield.
Citibank (C): Cramer said that the stock jumped on an investment from a sovereign wealth fund because when this happened in 1990, the bottom was put in, and it also means that the bank won't go under.
Segment 2: Investing in Chile - Part II
Cramer's other recommendation in Chile was Enersis (ENI), a utility with a nice growth rate. Cramer likes it as much as CFPL Energia (CPL), the Brazilian utility that he recommended a couple months ago. Enersis generates most of its power using hydropower, and he thinks it is a great way to profit from the increasing size of the middle class because the first thing people do is electrify their homes as soon as they can afford it. The stock also has a 2.1% yield, and Cramer thinks it will go up to the mid $20's.
Cramer took phone calls on the following stocks:
CFPL Energia (CPL): Cramer is a long term bull on this stock, and wants to buy on the current pullback.
Mercado Libre (MELI): Cramer called this stock the eBay (EBAY) of Latin America, and said that the people who are worried about profits are wrong, because the key to this stock is revenue growth. He likes it under $53.
Segment 3: Lightning Round!
Merck (MRK): Cramer thinks it will be stuck around $40 for the short term, but he likes it. He also is bullish on Schering Plough (SGP).
Whole Foods (WFMI): Cramer said "Don't buy."
Consol Energy (CNX): Cramer said to take some profits because the stock is up so much, but he is still bullish.
Abiomed (ABMD): Cramer is bearish on this stock, and said that it is way too speculative.
Temple-Inland (TIN): Cramer recommended it at $11, and he is still bullish because he thinks it is going to $16.
Chindex International (CHDX): Cramer said to take profits in this one as well because of a 11% spike today.
PG&E (PGC): Cramer likes that they will probably make an order with First Solar (FSLR) soon, which is the only thing he likes about this stock.
Focus Media (FMCN): Cramer said this is tough because he was recommending it in the past, but he is no longer bullish on this stock.
Vaalco Energy (EGY): Cramer thinks this stock can jump to $10, so he is bullish.
Central Garden (CENT): Cramer said this part of retail isn't working, so he is bearish.
Segment 4: Sell Block
Cramer put (IMB) and Standard Pacific (SPF) in his Sell Block as cautionary tales about the allure of stocks that are less than $5. People think that low priced stocks can't go much lower, but the fact is that it can go to $0. Thornburg Mortgage (TMA) is an example of a low priced stock that lost 50% in one night, and went from $9 to $0.71 over the past year. He said that the stocks aren't this low because the market is putting them on sale, but because they have a problem. IMB doesn't have enough cash in reserve for their bad loans, and is diluting the holdings of current investors by issuing stock. Cramer thinks that SPF shouldn't even be in business any more, because they work in bad markets, and they hold a lot of speculative housing stock.
Segment 5: Mad Money Emails
Yamana Gold (AUY): Cramer said that the stock is exploding back up after dropping for a while, and that he is still bullish.
