|
Cramer on BloggingStocks: In retail, lower prices beckon |
|
| May 12, 2008 08:40 AM UTC |
|
Tracked Blogger
|
Via BloggingStocks:
Filed under: Wal-Mart (WMT), Market matters, FedEx Corp (FDX), Oil, Stocks to Sell, Cramer on BloggingStocks  TheStreet.com's Jim Cramer says FedEx exposed three market fictions with its news on Friday. Sometimes you have to wonder why some stocks just don't stay down after bad news. Take FedEx (NYSE: FDX) (Cramer's Take). Earlier this year, the stock shed about 10% of its value when it forecast worse-than-expected earnings, citing lower volumes and higher fuel costs. It then proceeded to rally 25% from that dismal forecast even as oil went up dramatically and business in the U.S., particularly retail business, got softer and softer! Now we get pretty much a simple extension of what the company said last near the end of March, and people are acting surprised and furiously dumping the stock. FedEx cuts to a couple abiding fictions in this market. The first is that all valuations are cheap, so it is OK to buy them. FedEx has long-term growth of 10% and sells at 14 times earnings, but I question both the growth and the multiple as being too high in a world where energy just won't quit. But that brings us to the second fiction: People have been buying this stock with the idea that oil just has to level off somewhere. Considering it didn't, how could anyone be surprised at this news? And the third fiction? The turn in the economy is right around the corner. Continue reading Cramer on BloggingStocks: In retail, lower prices beckon Permalink | Email this | Comments<map name="google_ad_map_145-1192731"><area href="http://imageads.googleadservices.com/pagead/imgclick/145-1192731?pos=0" shape="rect" coords="1,2,367,28" /><area href="http://services.google.com/feedback/abg" shape="rect" coords="384,10,453,23" /></map> 
Read the rest of original post »
|
Add Comment
Be the first to comment on this story and earn 2 points.
Your Comment
|
|
IN THE PRESS |
|
|
|
|
|
|
| About | RSS | Feedback | Contact Us | Terms of Service | Privacy |
© 2009 FinancialContent Services, Inc. |
|
Data powered by FinancialContent. All Rights Reserved. Quotes delayed at least 20 minutes unless otherwise indicated. |
|
None of the information contained on SocialPicks.com constitutes a recommendation by SocialPicks or its users that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. SocialPicks is not responsible for the posts, discussions, and recommendations of the users on the Site. SocialPicks does not provide investment advice. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the website. SocialPicks' users' past results are not necessarily indicative of future performance. Neither SocialPicks nor any of its users guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the website. You understand and agree that you use the Site and Services at your own discretion and risk and that you will be solely responsible for any damages that arise from such use. Before acting on any information contained on the website, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser. |
