Tonight on Cramer’s MAD MONEY on CNBC, Jim Cramer was reviewing some stocks that went unscathed through the market sell-off. When the next sell-off occurs, these are the ones you want to flock to. Cramer says the new highs are far from random and they can ride out the next storm. The PBM (Pharmacy Benefit Managers) and Tire companies that are hitting new high lists. The best of breed in each are Medco Health (MHS) and Goodyear Tire (GT).
Medco (MHS-NYSE) is one Cramer likes because they help big companies save on healthcare costs. They make money when drugs come off patent and they can save money. Last year was a big patent expiration year and 2008 will be another. It has big cash flow and has a mountain of cash. The one Cramer likes even more that he has bought is Express Scripts (ESRX) that is in a biding war for Caremark. If it doesn’t win the Caremark deal he thinks they’ll do a huge buyback.
As far as Goodyear Tire (GT-NYSE), it has slashed benefits and cut pensions to increase savings. The workers there aren’t happy about this but it is good for shareholders. Merrill Lynch just raised it and he thinks it’s going up. CRT is using a $39 target on a turnaround.
In a call-in Jim Cramer again said on AMD (AMD-NYSE) that he really can’t see a reason as to why the stock needs to exist. Their decision to go into a price war with Intel was a death sentence and the only thing that can help them if if Intel gets nabbed over anti-trust issues.
Jon C. Ogg
March 7, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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