A sharp decline in the U.S. indices last week suggests higher volatility ahead. For the week of April 15, 2013, the Nasdaq equal-weighted Index (QQQE) dropped 2.62%, while the S&P 500 dropped 2.09%. Led by a decline in gold prices, pressure on copper prices is adjusting to lower economic growth ahead. Although consumption for copper in China distorts pricing, weak supply chain figures ("ISM") are weaker, markets appear to be topping, and the other commodity prices are dropping.
Between April 16 and 18, 2013, Jim Cramer was bullish on 26 of the 29 calls made. On average, the bullish calls were up 8.36% from their 200-day moving average. Bearish calls were down 20.9% on average.
Notable "buy" calls are summarized in the table below:
Coca-Cola (KO) snapped back from a $40.20 low on April 15 to close at $42.66 by the end of the week. The company earned $0.46 per share on revenue of $11.04 billion. Sales volume grew by 4%, led by strength in the emerging markets, and includes sales from Thailand and India. Weaker regions were led by China, Japan, and Brazil.
During the earnings call, the company said that it would aim to increase efficiency from its bottling partnerships. Coca-Cola expects that despite higher sales at low-pricing regions, pricing should remain stable.
American International Group (AIG) shares are range-bound, oscillating between $37 and $40 since February 2013. AIG won a $10 billion legal battle against Bank of America (BAC). AIG filed a suit against the bank in 2011, claiming fraud and misrepresentations for the $28 billion worth of MBS purchases it made.
AIG reached a 52-week high on April 8, but backed down since then.
Verizon (VZ) was another notable Cramer buy call. The company reported earnings that beat expectations by $0.02 per share. Verizon earned $0.68 per share on revenue of $29.4 billion. Wireless revenue rose 6.8% compared to last year, while Apple (AAPL) iPhone activations reached 4 million units. The iPhone activations are a 25% increase over last year, and represent more than half of all smartphone activations for Verizon.
Genworth Financial Inc. (GNW) is slumping, closing sharply lower after peaking at $10.74. Shares are already doubled in the last half year. Genworth is also being named in a suit by homeowners that accuses BofA took kickbacks from private insurers.
Salesforce.com, inc (CRM) began trading on April 18 with shares split 4-for-1. Since March, shares are down 13% from its 52-week high. Unusually high volume was noted by the Street on April 18. In late-March, Salesforce’s CEO said that the Chatter enterprise social network platform would be the primary user interface for Salesforce software. The company is refreshing the mobile portion of Chatter.
When Salesforce.com is plotted against the forward P/E (Price of Profitability), shares are the most highly valued:
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Written by Chris Lau