Tracking Cramer: 5 Picks From January
Christopher is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Stock market specialist Jim Cramer recommended that you buy these five stocks one month ago on his January 10th and 11th episodes of Mad Money. In this article, I analyze his picks on a relative value basis and analyze each stock's performance since Mr. Cramer's recommendation.
Honeywell International (NYSE: HON): When Jim Cramer recommended this stock a month ago it was at $56.58 per share and as of today it's at $59.03 per share. The S&P, in the same time period, has risen from 1280 to 1325, a gain of 45 points. In addition to capital appreciation the stock also pays a dividend of $1.49 per share on an annual basis with a dividend yield of 2.6% at the stock's current price. What's more, the company has a history of raising the dividend on a consistent basis. The trailing twelve month price to earnings multiple on the stock is 22.99 on earnings of $2.61 per share-- compared to the sector average of 15.61, suggesting investors are willing to pay a premium on the stock. Honeywell International is classified as a conglomerate in an industry that mainly produces sophisticated controls and gauges for airplanes, automobiles, industrial machinery as well as heating and air conditioning systems. Although the company reported a loss in the latest quarterly report, on pension related costs, the overall report was positive and the company anticipates strong growth going forward. In terms of growth going forward the company is still relatively cheap with a PEG ratio of .92, compared to its two closest competitors: BorgWarner Inc. (BWA) with a PEG ratio of .66 and United Technologies Corporation (UTX) with a PEG ratio of 1.28.
Masco (NYSE: MAS): One month ago Jim Cramer recommended this stock. At the time it was $11.99 per share and today it's at $12.44 per share. In the same time period the S&P has risen from 1280 to 1325, a gain of 45 points. The stock also pays a dividend of $.30 per share on an annual basis with a dividend yield of 2.4% at the stock's current price. The company has consistently paid this dividend since the second quarter of 2009. Masco produces products for the construction industry such as plumbing fixtures, paints and cabinetry. Although the housing downturn has understandably effected the company negatively Masco is considered well positioned to recover quickly in the inevitable upturn. With the necessity of companies like Home Depot (HD) to replenish their inventories in advance of any construction upturn and the strategic location of the company's retail outlets in general-- Masco's turn around will in all probability lead a housing upturn. The company's two closest competitors are Apogee Enterprises (APOG) and Universal Forest Products (UFPI). Apogee Enterprises currently has a PEG ratio of 12.19 with forecast earnings growth of 122.5% and Universal Forest Products has a PEG ratio of 12.54 with forecast earnings growth of 299%. Masco is relatively underpriced by comparison with a PEG ratio of 13.82 and forecast earnings growth of 420.5%.
Regeneron Pharmaceuticals (NASDAQ: REGN): When Jim Cramer recommended this stock a month ago it was at $77.36 per share and today it's at $95.01 per share. In the same time period the Nasdaq has risen from 2650 to 2859, a gain of 209 points. The stock is also hitting new 52 week highs on a daily basis. Regeneron Pharmaceuticals is basically a biopharmaceutical, research and development company that develops drugs for the treatment of a range of diseases. In recent news the company raised its estimates for its blockbuster drug Eylea to between $140 million and $160 million in sales for 2012. This forecast in combination with an R.W. Baird upgrade from neutral to outperform and a price target raise from $56 a share to $81 per share sent the stock up 13%. Eylea is designed to treat macular degeneration, a leading cause of blindness in the elderly. The company's two closest competitors in this market are Amgen Inc. (AMGN) and Novartis AG (NVS).Amgen currently has a PEG ratio of 1.31 with a five year earnings growth forecast of 8.9% and Novartis has a PEG ratio of 1.90 with a five year earnings growth forecast of only 5.2%. Regeneron Pharmaceuticals is extremely underpriced by comparison with a PEG ratio of -1.01 and five year earnings growth forecast of 37.5%.
Federal Realty Investment Trust (NYSE: FRT): One month ago Jim Cramer recommended this stock. At the time it was $91.56 per share and today it's at $95.12 per share. The S&P, in the same time period, has risen from 1280 to 1325, a gain of 45 points. Federal Realty Investment Trust is also hitting new 52 week highs on a daily basis. In addition to capital appreciation the stock pays a dividend of $2.76 per share on an annual basis with a dividend yield of 2.9% at the its current price.Federal Realty Investment Trust also has a history of raising the dividend on a consistent basis. The trailing twelve month price to earnings multiple on the stock is 41.07 on earnings of $2.33 per share-- compared to the sector average of 30.53, suggesting investors are willing to pay a slight premium on the stock. Federal Realty Investment Trust is one of the few realty investment trusts in a position to purchase additional assets (at bargain basement prices) in contrast to disposing of nonperforming assets and this, in and of itself, says a lot about the company. Federal Realty Investment Trust is a little pricy with a PEG ratio of 5.42 (reflecting the increased interest in the stock) compared to its two rivals: Acadia Realty Trust (AKR) with a PEG ratio of 2.32 and National Retail Properties (NNN) with a PEG ratio of 2.77.
Johnson Controls (NYSE: JCI): When Jim Cramer recommended this stock a month ago it was at $34.36 per share and today it's at $33.35 per share. In the same time period the S&P has risen from 1280 to 1325, a gain of 45 points. The stock pays a dividend of $.72 per share on an annual basis with a dividend yield of 2.3% at the its current price. The company has raised its dividend slightly over the last couple of years but has still not reached its pre recession levels. The stock has been pretty much range bound between $25 and $35 per share since August of 2011. As a manufacturer of car interiors, heating, ventilation, and air conditioning products for the automobile industry Johnson Controls is caught up in the on and off again uncertainty of the industry in general. Although the company's first-quarter earnings were up 9.3% on strength in its battery division the company had to lower its guidance on a temporary plant shutdown in China. The company's two closest competitors are Exide Technologies (XIDE) and Magna International, Inc. (MGA). Exide Technologies currently has a PEG ratio of 1 and Magna International has a PEG ratio of .92 while Johnson Controls has a comparatively cheap PEG ratio of .60.
The Motley Fool has no positions in the stocks mentioned above. DividendKings has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
