Jim Cramer: Guess?, SAIC, IAC/InterActiveCorp, Lear, Autoliv
Cramer, a market commentator and former hedge-fund manager, said he expects the stock to continue to rise because strong back-to-school sales can presage strong holiday sales and because increasing numbers of stores in the U.S., South Korea and Japan will help growth.
In response to a caller, Cramer said he wasn't enthusiastic about Blue Nile Inc. (NILE) because its price-to-earnings ratio wasn't justified by its growth rate. He said to buy shares of IAC/InterActiveCorp (IACI) because he liked its Ask.com Web site. He said Google Inc.'s purchase of YouTube Inc. with shares won't reduce their value and he reaffirmed his recommendation of Google stock.
In a segment about ``a new way to play the military-industrial complex,'' he said he expected SAIC Inc., which will soon go public, to be the heir to the successes of General Dynamics Corp. (GD), Lockheed Martin Corp. (LMT) and Northrop Grumman Corp. (NOC)
With 87 percent of its funds coming from the government, the company will be ``best of breed'' and will be worth buying at prices as high as $20 to $22 a share.
In response to callers, he said he expects General Dynamics to rise to $85. He told viewers to avoid Armor Holdings Inc. because it cut its forecast.
Cramer said to avoid Delphi Corp. and Dana Corp. because their bankruptcies could keep their stocks low. Instead, those seeking to invest in makers of car parts should buy shares of Lear Corp. (LEA) and Autoliv Inc. (ALV), he said.
Cramer recommended Sprint Nextel Corp. (S), CVS Corp., GigaMedia Ltd. (GIGM), Yamana Gold Inc. (YRI), Enbridge Energy Partners, Oracle Corp. (ORCL), Time Warner Inc. (TWX), International Speedway Corp. (ISCA), Starbucks Corp. (SBUX), Atheros Communications and Honeywell International Inc. (HON) in response to questions during the show's ``Lightning Round,'' ``Sudden Death'' and letters segments.
He also told viewers to avoid Shutterfly Inc., Broadcom Corp. (BRCM), ViroPharma Inc. (VPHM), MEMC Electronic Materials Inc. (WFR), Transocean Inc., United Parcel Service Inc. (UPS), TurboChef Technologies Inc., Nighthawk Radiology Holdings Inc., First Marblehead Corp. and Dell Inc. (DELL)
He told a viewer to sell part of his holdings of Riverbed Technology Inc. (RVBD)
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