On Tuesday night’s MAD MONEY on CNBC , Jim Cramer added two morefavorite stocks to his favorite stocks, and he keyed in on #5 and #3. Monday he said he was doing only 4 picks this week, but he changedand said it would be 5 picks this week.
His #3 best pick out of foreign stocks is Bank of Nova Scotia (BNS) in Canada, he calls it a cheap way to play Latin and Caribbean growth. His #4 pick in foreign stocks from Monday was CVRD (RIO); here is the logic behind his pick last night; his pick closed up 7% at $32.81 today after he touted it. His #5 pick was NTL Inc. (NTLI-NASDAQ) as a catch-up play and tied it to Virgin. Here was his logic on the rest; NTLI traded up 4% after he commented on it.
Cramer said that the IPO today AeroVironment (AVAV) was a sell at $25.00. He thinks you can buy it back at $22.00 or so. This was one we noted that seemed to high when it gapped up to $25.00 at the open, but rationale and valuations aren’t what rule IPO’s.
Cramer discussed the Tyco International (TYC) split-upcoming soon, and he thinks it could be worth 10% to 30% more in the break-up.
Cramer also called the CEO of VF Corp (VFC) after the drop today and Cramer defended the stock by saying the reaction was wrong on Wall Street.
Jon C. Ogg
January 23, 2007
Thursday, January 26, 2012
Monday, January 23, 2012
Saudi prince purchases $300 million stake in Twitter
NEW YORK (CNNMoney) -- Saudi Prince Alwaleed bin Talal said Monday that he and his investment firm, Kingdom Holding Company, are purchasing a $300 million stake in Twitter.
The billionaire prince said the investment was made after "several months of negotiations" and would represent "a strategic stake" in the microblogging service.
"We believe that social media will fundamentally change the media industry landscape in the coming years. Twitter will capture and monetize this positive trend," KHC executive director of private equity and international investments Ahmed Halawani said in a press release.
The prince's Twitter shares were bought on the secondary market, according to Fortune reporter Dan Primack -- which means that Twitter didn't directly recieve any of the cash.
While it's unclear how much control Alwaleed's investment will provide, the prince's investment firm looks to become long-term investors in its portfolio investments and "seeks to work closely with the management of those companies and participate in strategic decisions," according to its site.
With a reported net worth of $21.3 billion, Prince Alwaleed has topped Arabian Business's Arab Rich list for eight consecutive years.
Alwaleed's investment firm, KHC, owns a 7% stake in News Corporation (NWS) along with a host of high-profile investments, including a 29.9% stake in Saudi Research and Marketing Group. KHC's other investments include CNNMoney parent company Time Warner (TWX, Fortune 500), Apple (AAPL, Fortune 500) and Citigroup (C, Fortune 500). Alwaleed also has plans to launch a privately owned news channel.
The Saudi prince invested in Citigroup in the early 1990s, when the financial services giant was reeling from a capital crunch. Since then, the billionaire has invested in a host of technology and media companies.
A significant stakeholder in News Corp., Alwaleed defended Rubert Murdoch and the company's future this year am! id accus ations that the paper had hacked into the voice mail accounts of thousands of people.
"I interact with News Corp and I see a lot of depth at the management level, and at all levels," he told CNN's Piers Morgan in July.
In August, the five-year-old social media company raised a "significant" funding round led by venture firm DST Global. The company amended its certificate of incorporation forms to authorize the issuance of up to 25 million new shares, priced at just over $16 per share. That would let the company raise around $400 million in new funding. Multiple reports pegged the company's valuation at $8 billion after the funding round.
With nearly 800 employees -- and around 100 hired in the last month -- Twitter is undergoing a transformation. After management shakeups and an exodus of early employees, the company is bolstering its engineering team and focusing on expanding its reach.
Twitter, along with Facebook, is being closely watched for signs that it may look to file for an initial public offering.
Several social media firms have gone public this year, including LinkedIn (LNKD) and Groupon (GRPN) -- but both stocks cooled after their first day of trading. And last Friday, shares of social gaming company Zynga (ZNGA) fell on their first day.
The billionaire prince said the investment was made after "several months of negotiations" and would represent "a strategic stake" in the microblogging service.
"We believe that social media will fundamentally change the media industry landscape in the coming years. Twitter will capture and monetize this positive trend," KHC executive director of private equity and international investments Ahmed Halawani said in a press release.
The prince's Twitter shares were bought on the secondary market, according to Fortune reporter Dan Primack -- which means that Twitter didn't directly recieve any of the cash.
While it's unclear how much control Alwaleed's investment will provide, the prince's investment firm looks to become long-term investors in its portfolio investments and "seeks to work closely with the management of those companies and participate in strategic decisions," according to its site.
With a reported net worth of $21.3 billion, Prince Alwaleed has topped Arabian Business's Arab Rich list for eight consecutive years.
Alwaleed's investment firm, KHC, owns a 7% stake in News Corporation (NWS) along with a host of high-profile investments, including a 29.9% stake in Saudi Research and Marketing Group. KHC's other investments include CNNMoney parent company Time Warner (TWX, Fortune 500), Apple (AAPL, Fortune 500) and Citigroup (C, Fortune 500). Alwaleed also has plans to launch a privately owned news channel.
The Saudi prince invested in Citigroup in the early 1990s, when the financial services giant was reeling from a capital crunch. Since then, the billionaire has invested in a host of technology and media companies.
A significant stakeholder in News Corp., Alwaleed defended Rubert Murdoch and the company's future this year am! id accus ations that the paper had hacked into the voice mail accounts of thousands of people.
"I interact with News Corp and I see a lot of depth at the management level, and at all levels," he told CNN's Piers Morgan in July.
What's really behind Twitter's staff exodus
The Saudi prince is the latest power player to bet that fast-growing Twitter will transform itself into a profitable business.In August, the five-year-old social media company raised a "significant" funding round led by venture firm DST Global. The company amended its certificate of incorporation forms to authorize the issuance of up to 25 million new shares, priced at just over $16 per share. That would let the company raise around $400 million in new funding. Multiple reports pegged the company's valuation at $8 billion after the funding round.
With nearly 800 employees -- and around 100 hired in the last month -- Twitter is undergoing a transformation. After management shakeups and an exodus of early employees, the company is bolstering its engineering team and focusing on expanding its reach.
Twitter, along with Facebook, is being closely watched for signs that it may look to file for an initial public offering.
Several social media firms have gone public this year, including LinkedIn (LNKD) and Groupon (GRPN) -- but both stocks cooled after their first day of trading. And last Friday, shares of social gaming company Zynga (ZNGA) fell on their first day.
The Seismic Shift from Value to Growth
While Wall Street is focused on the Federal Reserve and all the talking heads are debating Ben Bernanke’s next move, I have to let you in on a secret—that’s not where the real action is. No, the really big development on Wall Street is the dramatic shift out of value stocks and into growth stocks.
Write this down because it’s going to be the leading market theme for the next several months. Institutional investors have been quietly dumping value stocks and are slowly picking up shares in many major growth stocks. Not only is this a big move, but it’s happening right under the noses of individual investors. Already this year, the Russell 1000 Growth Index is up 12.35%, which is twice as much as the Russell 1000 Value Index—and the gap is about to get much wider.
My money management firm just completed a thorough analysis of the growth and value sectors, and we still see enormous opportunities in growth stocks. Here’s what my analysts and I found: The ratio of the Russell 1000 Growth Index to the Russell 100 Value Index is at its lowest point in nearly 30 years. This tells us that despite growth’s rally this year, it’s still significantly lagged the market this cycle.
Not all growth stocks are created equal. It’s a big mistake for you to put all of your eggs in one growth basket. Our research has found that large-cap stocks are outperforming all other size sectors of the market. The market-cap phenomenon has been very dramatic through the first eight months of this year
My research team and I ranked every stock by market cap, and we then examined its one-month return. We found that the largest stocks have significantly outperformed smaller stocks on a year-to-date basis.
What’s causing this to happen? Well, for one, it’s very likely that the weak dollar combined with a strong institutional bias toward mega-caps and multinationals is accelerating t! his tren d.
We also looked at each stock’s price/earnings ratio compared with its projected earnings growth rate. This is also known as the PEG ratio. We did this for the entire universe of stocks. We then divided the market into ten groups ranked by market size. We found that the stocks in the largest market cap group had the lowest PEG ratio (meaning these are the best values). So even though large-cap stocks have had a good run, they still appear cheap relative to all other market cap ranges.
I’ll give you a great example of a large-cap growth stock that’s benefiting from the current market, especially the weak dollar. That stock is Monsanto (MON). The St. Louis-based company is one of the world’s leading multinational agriculture biotech stocks, and Monsanto loves the weaker dollar. As you might imagine, the company’s business is booming. By my estimate, earnings-per-share will be up about 50% this year.
The good news is that I don’t see Monsanto slowing down anytime soon. In fact, yesterday Monsanto predicted that it could triple the amount of farming acres planted worldwide with its genetically engineered seeds. Think about that!
According to the Biotechnology Industry Organization, biotech crop acreage increased 13% between 2005 and 2006. href="http://www.businessweek.com/ap/financialnews/D8RTHQK04.htm" target="_blank">Business Week notes:
Write this down because it’s going to be the leading market theme for the next several months. Institutional investors have been quietly dumping value stocks and are slowly picking up shares in many major growth stocks. Not only is this a big move, but it’s happening right under the noses of individual investors. Already this year, the Russell 1000 Growth Index is up 12.35%, which is twice as much as the Russell 1000 Value Index—and the gap is about to get much wider.
My money management firm just completed a thorough analysis of the growth and value sectors, and we still see enormous opportunities in growth stocks. Here’s what my analysts and I found: The ratio of the Russell 1000 Growth Index to the Russell 100 Value Index is at its lowest point in nearly 30 years. This tells us that despite growth’s rally this year, it’s still significantly lagged the market this cycle.
Not all growth stocks are created equal. It’s a big mistake for you to put all of your eggs in one growth basket. Our research has found that large-cap stocks are outperforming all other size sectors of the market. The market-cap phenomenon has been very dramatic through the first eight months of this year
My research team and I ranked every stock by market cap, and we then examined its one-month return. We found that the largest stocks have significantly outperformed smaller stocks on a year-to-date basis.
What’s causing this to happen? Well, for one, it’s very likely that the weak dollar combined with a strong institutional bias toward mega-caps and multinationals is accelerating t! his tren d.
We also looked at each stock’s price/earnings ratio compared with its projected earnings growth rate. This is also known as the PEG ratio. We did this for the entire universe of stocks. We then divided the market into ten groups ranked by market size. We found that the stocks in the largest market cap group had the lowest PEG ratio (meaning these are the best values). So even though large-cap stocks have had a good run, they still appear cheap relative to all other market cap ranges.
I’ll give you a great example of a large-cap growth stock that’s benefiting from the current market, especially the weak dollar. That stock is Monsanto (MON). The St. Louis-based company is one of the world’s leading multinational agriculture biotech stocks, and Monsanto loves the weaker dollar. As you might imagine, the company’s business is booming. By my estimate, earnings-per-share will be up about 50% this year.
The good news is that I don’t see Monsanto slowing down anytime soon. In fact, yesterday Monsanto predicted that it could triple the amount of farming acres planted worldwide with its genetically engineered seeds. Think about that!
According to the Biotechnology Industry Organization, biotech crop acreage increased 13% between 2005 and 2006. href="http://www.businessweek.com/ap/financialnews/D8RTHQK04.htm" target="_blank">Business Week notes:
Begemann said Brazil will be a hot spot for sales growth after Monsanto’s purchase of the Agroeste seed company. The acquisition boosts Monsanto’s market share in Brazil to 40 percent. That will give Monsanto the outlets it needs to introduce new strains of crops like YieldGard Corn Borer, he said.
Monsanto has increasingly invested in “advanced breeding” techniques to develop new crops without genetic engineering. Instead, the company uses gene markers and advanced computers to rapidly breed plants with desirable traits.
Subscribers to my Blue Chip Growth service have nearly tripled their money in Monsanto. Don’t think you arrived too late to the party. I currently rate Monsanto a strong buy for conservative investors up to $79 a share.
Another large-cap growth stock I favor in Blue Chip Growth is McDonald’s (MCD). This one may come as a shock to you because McDonald’s business hasn’t been very strong in the United States, but that’s not where the growth is coming. Instead, McDonald’s is incredibly popular overseas. Just like Monsanto, McDonald’s thrives in a weak-dollar environment.
McDonald’s also has another company in its sights—Starbucks. Believe it or not, some folks like the taste of McDonald’s coffee better than Starbucks’! For the past few weeks, analysts have been revising MCD’s earnings estimate higher. The consensus now sees earnings coming in at $3.05 a share. Personally, I think that might be too low since the weak dollar gives such a boost to shares of MCD. I rate McDonald’s a strong buy up to $59 a share.
My advice is to take full advantage of the market’s shift to growth stocks. This will be a major theme in 2008.
Next week is the first week of the fourth quarter. Soon the market will get a chance to digest third-quarter earnings reports. We’ll also get some initial guidance on how well the fourth quarter is shaping up. Until then, take advantage of Wall Street’s seismic shift to growth stocks.
2007 has been a fantastic year for href="/order/?pc=8UX113" target="_blank">Blue Chip Growth subscribers – look at a few of the gains we’ve locked in this year: Brookfield Asset +147%; Nucor Corp +37%; BG Group +114%; Suncor Energy +195%; Celgene +39%; PetroChina +42%; Cameco +118%; Transocean +56%. Plus, we have many more winners just like Monsanto (triplers and doublers) still on our list. Want the names of more winning s! tocks? T ry Blue Chip Growth risk free for 6 months!
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