NEW YORK (TheStreet) -- Investors looking at crude oil technicals and thinking the commodity looks like a good value right now are like the people who saw a white dress when the infamous photo of a blue dress crossed their newsfeeds. In this case, investors' misperception comes from reports of oil rig shutdowns and crude's ability to remain above a key technical level, suggesting the commodity has bottomed. Those are distractions from a real fundamental issue -- there's too much oil and too few places to affordably store it, said Tim Evans, Energy Futures Specialist at Citi Futures. "I'm trying to keep my clients from becoming complacent about rising inventories as if they don't matter because price action suggests we should look away from physical surplus in the market," Evans said. "There's substantial downside risk, particularly at the front of the WTI crude oil curve." In the near term, or front of the curve, declining capital investment and declining drilling rig counts -- the factors that have driven oil prices higher in recent weeks -- are what matter least. In other words, the dress is blue, not white. So instead of a bottom in oil prices, this is what investors should be seeing: 1- High and rising oil inventories 2- High and rising oil production 3- The rising cost of storing surplus oil Current inventories in Cushing, Okla., one of the most important crude trading hubs, are within 3 million barrels of the record high, which occurred in April 2013 due to a lack of outbound pipeline capacity from Cushing, according to energy market data provider Genscape, which monitors oil storage tank volume levels at Cushing. As of Feb. 27, 63% of Cushing storage capacity was being used. Since Genscape began monitoring Cushing in 2009, capacity has never exceeded 80%. As the most affordable crude oil storage facilities like Cushing fill up, the cost of storage is on the rise. The higher cost will affect ETF investors, who need the spot price to rally more than $2 just to break even as their oil futures contracts roll forward to the following month. That's because the curve is normal, with pricing rising each month, so when investors roll forward they sell at a lower price and buy at a higher price. With the $2.00 cost of storing oil baked into the equation -- $1.50 higher than what it costs under normal conditions -- ETFs will see that as a drag on their performance. It's going to be frustrating for those holding oil ETF positions, whose numbers have grown to the highest level in five years, said Citi's Evans. They're looking for the great turn in energy market fundamentals they hope will happen, leading oil prices to behave so well despite a dearth of positive news. "Just by oil getting 20% off its low, they think the sun has come back out and the birds are singing and it's a wonderful time to own oil," Evans said. "Meanwhile, the statistics show oil production hit its highest level since the early 1970s -- a 40-year high -- and is 15% higher than a week ago." Crude oil inventories are the highest in 84 years, since 1931. The U.S. Dept. of Energy weekly inventory series dates from 1982, so analysts making that comparison are looking at an older, monthly data series from a different source, he noted. Inventories of 444.4 million barrels are 80.6 million barrels, or 22.1% higher than a year ago and 89.5 million barrels, or 25.2%, above the five-year average level. Citi Futures' chart shows the steep rise in crude stocks this year alone. The average crude stocks surplus has spiked sharply since December, as illustrated by the Citi Futures chart below. Next week, the market will be looking at new monthly reports from the DOE, OPEC, and the International Energy Agency that may show some revisions, but the February outlooks implied a first-half 2015 global supply/demand surplus on the order of 1.4 million barrels per day -- a degree of oversupply confirmed by the uptrend in U.S. crude oil inventories, Evans said. Those reports will come against the backdrop of OPEC's ongoing mission to snuff out U.S. competitors and the Iranian nuclear talks that have caused some market chatter. Evans doesn't anticipate either a quick agreement or a quick lifting of the embargo on Iranian oil exports. Instead, he sees a gradual process with output walking higher in the second half of 2015 and into 2016 rather than a sudden flood of additional barrels. Among other issues, he added, they'll need to find customers. Cold weather and incessant snow storms in the Northeastern U.S., a key source of supply for the New York Harbor delivery point for the RBOB gasoline and heating oil futures, have caused operational difficulties in refineries. Scheduled seasonal maintenance work has also limited refinery runs. Add to that a risk of a further drop in refinery rates because of the ongoing USW strike against selected U.S. refineries since Feb. 1, which have had limited impact on runs so far, and crude is meeting a bottleneck that's contributing to supply buildups. The drop in refinery runs is a support for the petroleum products -- and we're seeing gasoline prices rise as a result -- but it's a corresponding bearish factor for crude oil. It would seem the cards are stacked against oil. But like other markets that have risen inexplicably, oil is also benefiting from the liquidity the U.S. Federal Reserve has poured into the economy and the low interest rate environment that has investors taking on risk. The numbers -- physical supply and demand -- are not in their favor, however. "Sometimes, when you look for risk, you will find it," Evans said. "Inventory is 20% higher than a year ago, and that should send us an economic message all on its own." Must Read: Warren Buffet's Top 10 Stock BuysClick to view a price quote on XOM. Click to research the Energy industry.
Archive for the ‘CVX’ Category
NEW YORK (TheStreet) -- Even though the Federal Reserve upgraded its description of U.S. economic growth to "solid" from "moderate" in its statement on Wednesday, there are plenty of reasons why the economy may not be a strong as the central bank said. Consider what's going on in some key sectors of the stock market. Must Read: 10 Stocks Carl Icahn Loves for 2015: Apple, eBay, Hertz and More You cannot have a bull market for stocks and solid economic growth, for instance, with a correction in stocks of large banks, including the four "too big to fail" money center banks. The KBW Bank Index (BKX) ($66.68) had a gain of 7.2% in 2014 and set its 2014 intraday high of $75.61 on Dec. 29. This index is in "correction mode" with a year-to-date loss of 11% and is 13% below the 2014 high. The index is below its 50-day and 200-day simple moving averages at $71.80 and $70.70, respectively. The weekly chart for the banking index is negative with its key weekly moving average at $70.13. The 200-week simple moving average is a key level to hold on weakness at $56.54. Note that the weekly chart shows the banking index below the 50% Fibonacci Retracement of the Crash of 2008. Weekly Chart Courtesy of MetaStock Xenith You also cannot have a bull market for stocks and solid economic growth with steep declines in major energy stocks. Crude oil set a new low for the move on Wednesday at $44.08 per barrel. There are two energy giants in the Dow Jones Industrial Average. Here are their performance statistics and profiles. Chevron ($103.71) had a loss of 10% in 2014 and set its 2014 intraday high of $135.10 on July 24. The stock has a year-to-date loss of 8.2% and is 30% below the 2014 high. The stock is below its 50-day and 200-day simple moving averages at $109.93 and $120.69, respectively. The weekly chart for Chevron is negative with the stock below its key weekly moving average at $108.61 and below its 200-week simple moving average at $113.05. Weekly Chart Courtesy of MetaStock Xenith Must Read: Warren Buffett's Top 10 Dividend-Paying Stocks for 2015 Exxon Mobil ($87.95) had a loss of 8.6% in 2014 and set its 2014 intraday high of $104.76 on July 29. The stock has a year-to-date loss of 5.1% and is 19% below the 2014 high. The stock is below its 50-day and 200-day simple moving averages at $92.04 and $97.28, respectively. The weekly chart for Exxon is negative with the stock below its key weekly moving average at $91.34 and below its 200-week simple moving average at $89.06. Weekly Chart Courtesy of MetaStock Xenith A clear market warning has been provided with the decline in long-term U.S. Treasurys as the yield on the 30-Year bond set an all-time low at 2.273% on Wednesday. Investing in the iShares 20+ Year Treasury Bond ETF has been a winning strategy since the beginning of 2014, and its rise is a sign of growing concern about the U.S. economy and stock market. The Bond ETF ($136.77) had a gain of 24% in 2014 and set its all-time intraday high of $137.41 on Wednesday. The ETF has a year-to-date gain of 7.9%. The ETF is above its 50-day and 200-day simple moving averages at $126.40 and $117.78, respectively. The weekly chart for the bond ETF is positive but overbought with its key weekly moving average at $130.00 and its 200-week simple moving average at $114.26. Weekly Chart Courtesy of MetaStock Xenith Must Read: 16 Rock-Solid Dividend Stocks With 50 Years of Increasing Dividends and Market-Beating Performance Follow @SuttmeierClick to view a price quote on CVX. Click to research the Energy industry.
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener. NEW YORK ( TheStreet) -- The good guys just keep on winning, Jim Cramer told his Mad Money TV show viewers Friday. But with next week's flurry of earnings, Cramer told investors to "stop, look and listen" and not step on the battlefield because the news will be coming too fast to follow. On Monday, Cramer said he'll be watching Norfolk Southern and Microsoft , a stock which he owns for his charitable trust, Action Alerts PLUS. Cramer said he expects good things from both companies. Must Read: 16 Rock-Solid Dividend Stocks With 50 Years of Increasing Dividends and Market-Beating Performance Next, on Tuesday, it's a huge day, with 3M , American Airlines , Caterpillar , DuPont , Procter & Gamble and Apple , another Action Alerts PLUS name, all reporting. Cramer is bearish on Caterpillar but had positive things to say about all the others. Wednesday brings earnings from Boeing , Qualcomm and Biogen Idec . Cramer expects good results from all three of these faves. Then, on Thursday, it's Alibaba and Celgene , two stocks Cramer said will go higher, along with Amazon.com and Google , two stocks he said makes him nervous, despite Google also being an Action Alerts holding. Finally, on Friday, the earnings finally come to an end with Chevron and MasterCard , yet another AAP holding. Cramer advised steering clear of all oil stocks as well as MasterCard, which will likely fall after it reports. Executive Decision: Rick Hamada For his "Executive Decision" segment, Cramer spoke to Rick Hamada, CEO of Avnet , the tech component and solutions provider that posted a 6-cents-a-share earnings beat yesterday, news that sent shares up over $1. Hamada explained that Europe was particularly strong this quarter, up 7%, thanks in part to investments in the region and solid execution. He singled out Germany and the U.K. as above-average countries. Overall, Hamada said that tech spending was resilient throughout the quarter as new technologies are being adopted in the data center space as well in the "Internet of things." When asked about those "things," Hamada noted there are many opportunities for Avnet from the sensors all the way to the servers. Perhaps the only dark cloud over Avnet's quarter came from currency translation. Hamada said that with the weaker euro, sales appeared to be slowing down. Adjusted for a constant currency, investors can easily see that Avnet is on target meeting its promises. Cramer said Avnet is doing all the right things. Must Read: How to Trade the Market's Most-Active Stocks: UPS, Avon and More Cramer Takes on UPS and McDonald's It's time we hold CEOs accountable, Cramer told viewers as he sounded off against the heads of two Action Alerts PLUS holdings, UPS and McDonald's . Cramer said UPS promised that it wouldn't make the same mistakes it made during the 2013 holiday season. Instead, the company made worse ones, news that sent shares of UPS skidding 9% today. Cramer said the employees and shareholders of UPS deserve better and he called on UPS' board of directors to admit it made a mistake in its choice of CEO. Then there's McDonald's, which for several quarters has noted the "urgency" of its declining sales, yet has simply done nothing about it. Why should UPS and McDonald's get a pass when FedEx and Wendy's are hitting it out of the park, Cramer asked? These results are unacceptable, Cramer concluded, and these two companies need to find better people to lead their companies. Executive Decision: Bryan Jordan In his second "Executive Decision" segment, Cramer spoke with Bryan Jordan, chairman, president and CEO of First Horizon National , a regional bank that delivered a 3-cents-a-share earnings bear on robust lending. Shares of First Horizon yield 1.85% and are up 35% since Cramer first recommended the company two years ago. Jordan said First Horizon saw great customer activity this quarter, including growth in commercial real estate and new account openings. He said First Horizon continues to build a strong balance sheet and they expect to see the momentum continue. When asked about a loss of momentum in the oil and gas industries, Jordan noted he expects to see lots of growth in Texas, even if the oil and gas industries begin to pare back production. Turning to his bank's continued fallout from the mortgage crisis, Jordan said it has been six or seven long years, but First Horizon continues to make progress in making settlements and closing that chapter of its history. Cramer said local banks seem to be back in vogue and First Horizon is a shining example. Must Read: Starbucks' Seemingly Perfect Holiday Season May Not Have Been So Perfect Lightning Round In the Lightning Round, Cramer was bullish on Royal Dutch Shell , BioMarin , Cypress Semiconductor , Take-Two Interactive , Nordic American Tanker , Brown-Forman and Constellation Brands . Cramer was bearish on Zillow , Continental Resources , Juno Therapeutics , Micron Technology , Zynga and Teekay Tankers . Executive Decision: Russell Goldsmith In a third "Executive Decision" segment, Cramer sat down with Russell Goldsmith, chairman and CEO of City National Bank , a stock that's up 36% since Cramer first got behind the company in September 2013. City recently announced it is being acquired. Goldsmith said that City National wasn't for sale but the opportunity was right and it was "the right thing to do" for City's clients, employees and shareholders. When asked about the company's customer-focused strategy, Goldsmith said that it might seem old-fashioned, but City focuses on one client at a time, helping them on their way up as their wealth builds. Cramer commended Goldsmith for a job well done. Must Read: This Forgotten Cigarette Stock Could Give You a 12% Return This Year To watch replays of Cramer's video segments, visit the Mad Money page on CNBC. To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here. -- Written by Scott Rutt in Washington, D.C. To email Scott about this article, click here: Scott Rutt Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDCClick to view a price quote on NSC. Click to research the Transportation industry.
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener. NEW YORK ( TheStreet) -- If you buy into panic instead of selling into it you'll make more money. That was Jim Cramer's bottom line to his Mad Money viewers Thursday. Cramer said the markets suffered from a "depressive mood disorder" when it entered 2015, but those investors who obeyed their rational brains and bought into the panic made a ton of mad money. Cramer likened the market's recent action to the Ebola scare back in September. Back then the markets were also falling daily on the irrational premise that Ebola was everywhere and you were just a touch or a sneeze away from being next. But history proved that those fears were irrational and buying into panic was the smart move. Must Read: Jim Cramer's 11 Best Stock Picks in the Technology Sector Fast forward to today's markets where an irrational fear that lower oil prices can only mean the world's economies are in free fall. Once again the negativity became a self-fulfilling prophecy, Cramer said. If you buy into panic and sell into euphoria, you make more money, Cramer concluded. This simple notion was proven in September and again this month so remember it for next time. Oil Boom Continues Is America's oil boom coming to a screeching halt now that oil prices have plummeted? Not so fast, Cramer told viewers -- 2015 is still shaping up to be a banner year for U.S. production. Cramer said while it's true oil producers such as Concho Resources and Sanchez Energy have announced deep cuts in their drilling budgets for 2015, Concho is still expecting to increase its production between 16% and 20% in 2015 while Sanchez expects 40% production growth. The reality is most shale producers are still expecting record-setting production, even with fewer new wells being drilled. Add to that two huge offshore projects coming online from Chevron and Hess , and the world will be flush with oil for quite a while. That's why investors should expect oil prices to remain depressed for the foreseeable future as the supply of U.S. oil is only just getting started, Cramer said. Must Read: Friday's Jobs Report Likely to Reveal Slower Pace of Growth The 10 Best Performers on the S&P Now that the market is once again acting rationally, what should investors do with the top 10 best-performing stocks in the S&P 500? Cramer reviewed the list to find out. 1. Southwest Airlines . After being up 124% in 2014, Cramer said he prefers American Airlines or Spirit Airlines , both of which are less expensive. 2. Electronic Arts . Cramer said this stock, up 105%, is too hard to recommend given the hard comparisons. He prefers Take-Two Interactive . 3. Edward Lifesciences . Cramer said this medical device company is "killing it" and its 93% run in 2014 is just the beginning. 4. Allergan . Cramer said this story is played out but he still likes Actavis , which is acquiring Allergan. 5. Avago Technologies . Cramer said he'd rather own Apple , which is a holding in his charitable trust, Action Alerts PLUS, or Cypress Semiconductor . 6. Mallinckrodt . Cramer said this story is not done and the stock is only trading at 12 times earnings. 7. Delta Airlines . Cramer said Delta is good but American and Spirit are better. 8. Keurig Green Mountain . This stock, up 75%, has multiple ways to win and Cramer said this one is a buy. 9. Royal Caribbean . Cramer said there's no reason to pay up for this stock, but he likes the company with fuel prices plummeting. 10. Kroger . Cramer said he's still a big fan of this under-appreciated grocery chain. What's New in Biotech In a special interview, Cramer sat down with NBC News Medical Contributor Dr. Natalie Azar to discuss one of the hottest areas of biotech -- immunotherapy, or helping the body fight cancer cells directly rather than carpet-bombing your body with chemotherapy. Dr. Azar explained that our body's immune system is an amazing system of checks and balances that allows us to function but still ward off infection and disease. In the case of cancer, our bodies want to fight off and kill cancer cells but a protein known as PD-1 prevents that from happening. That's why a new class of immunotherapy drugs that works with our immune system and bypasses the PD-1 blocker are is exciting. Analyst expect that in just 10 years this class of drugs could be used against 60% of all cancers, representing a $35 billion opportunity. Azar noted that while this line of treatments is still in development and testing, the beginning uses of these drugs may not be that far off and they may likely prove to be safer and more effective than the current chemotherapy that cancer patients must endure. Must Read: What Jim Cramer Is Trading: Morgan Stanley, Bank of America, UPS and Unilever Lightning Round In the Lightning Round, Cramer was bullish on Spectra Energy and Skyworks Solutions . Cramer was bearish on JetBlue Airways , Consolidated Edison , Carlyle Group , Aegean Marine Petroleum , Infoblox and King Digital Entertainment . Am I Diversified? In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets. The first portfolio included Apple, Phillip Morris , Johnson Controls , Washington Real Estate Trust and Bank of America . Cramer said this portfolio was perfectly diversified with great dividend yield to boot. The second portfolio's top holdings included Intel , Cypress Semiconductor, Monster Beverage , Skechers and Under Armour . Cramer advised selling Intel and adding Bristol-Myers Squibb and replacing either Skechers or Under Armour with an industrial stock like United Technologies . The third portfolio had Cytokenetics , OncoMed , Walt Disney , Isis Pharmaceuticals and Cypress Semiconductor as its top five stocks. Cramer identified three of a kind with Cytogenetics, OncoMed and Isis. He recommended adding an industrial and a defense contractor like Lockheed Martin . Must Read: Who 3G Could Gobble Up Next With Its New $5 Billion Fund To watch replays of Cramer's video segments, visit the Mad Money page on CNBC. To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here. -- Written by Scott Rutt in Washington, D.C. To email Scott about this article, click here: Scott Rutt Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDCClick to view a price quote on CXO. Click to research the Energy industry.
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener. NEW YORK ( TheStreet) -- The markets aren't as grim as they appear to be, Jim Cramer said on Mad Money Tuesday. In fact, the markets are presenting a buying opportunity at current levels, but only if you know which stocks to buy. In a market where all news is treated as bad news, Cramer admitted there are still some big pitfalls that must be avoided. Oil prices are not done going down, he said, and that means the oil stocks aren't done either. There's no reason to own the oil stocks yet and no hurry to buy them either. Must Read: Buy These 5 ‘Dogs of the Dow’ for Gains in the New Year The financials are another worrisome sector, Cramer said. Low interest rates hurt earnings. But while stocks like Wells Fargo may indeed disappoint this quarter, this stock, unlike the oils, may not have much further to fall. Then there are the companies that actually benefit from lower oil prices, stocks like chemical maker PPG and retailer J.C. Penney , which surprised the markets with strong results. Cramer said both of these stocks are buys into weakness. Yes, there is some profit-taking going on along with some terrible earnings, Cramer concluded. But the world is not ending, and that means that for most stocks low interest rates and low inflation only make the stocks more attractive as they fall still lower. 10 Best Biotechs to Buy The biotech stocks have been among the best performing stocks for the past four years, Cramer told viewers. Last year, the group soared 33%. Could 2015 rack up more big gains for these high fliers? Absolutely. Cramer explained that many biotech companies used to be one-trick ponies, living or dying on a single FDA approval or rejection. But that's all changed. Many biotechs have moved from single drugs to drug platforms that can discover multiple drugs with a single technology. Isis Pharmaceuticals remains the poster child for successful drug platforms, Cramer continued. This company's technology is now being used to discover treatments for multiple genetic abnormalities. What about the rest of the high-flying biotechs? Cramer said Ovascience was the best performer last year, up 383%, and this company continues to show promise. Coming in at numbers two and three were Agios Pharmaceuticals and Bluebird Bio , up 367% and 337%, respectively, in 2014. Cramer is also bullish on these stocks. Continuing down the top 10 best performers are Receptos , TG Threapeutics , Prosensa , which is being acquired, and Achillion Pharmaceuticals , which has a promising hepatitis-c franchise. Cramer is also bullish on Amicus Therapeutics , PCT Therapeutics and Esperion Therapeutics . Must Read: 11 Worst-Rated Stocks in the Dow Jones Industrial Average These Stocks Are Real Dogs With a new year upon us, Cramer continued his annual ritual of looking into the worst-performing stocks of last year, the "Dogs of the Dow," to see if any are worth owning. Coming in at number eight is McDonald's , a stock Cramer owns for his charitable trust, Action Alerts PLUS. Cramer said this company needs to clean up its act or fire its CEO, and he expects one of those two to happen in 2015 -- which is why he has a $110 price target. At number seven is AT&T , which like number five on the list, Verizon , is in a price war with other carriers. Cramer said he likes AT&T for DirecTV and gives it a $38 price target, but thinks only Verizon can pop another $3 for the year. Boeing is at number six. Cramer gave this company a $150 price target even though investors appear to be bored with Boeing's defense and European exposure. Fourth is Exxon Mobil , with rival Chevron second. Cramer saw more pain for both these oil giants. Between the two is General Electric at number three. Cramer sees a lot of upside for GE. However, his biggest disappointment of 2014 is IBM , a company seemingly without a strategy and nothing to propel it higher. Off the Charts In the "Off The Charts" segment, Cramer went head to head with colleague Ed Ponsi over the chart direction of the markets as the bull market enters its sixth year. Ponsi looked at the markets through a different prism than Cramer, a political one. He noted that from 1833 through 2012 the market during the third year of a U.S. presidential term has yielded, on average, 10.4%. That compares to an average market return of only 1.9% during a president's first year. In fact, the last time the markets fell during a presidential third year was 1939. Ponsi also looked at the political makeup, noting that from 1949 through 2011, when there's a Democratic president and Republican Congress the markets average a 19.5% return. Flip that around and the markets typically see just a 4.9% gain. Cramer said he agreed with Ponsi's non-traditional analysis, noting that with bond yields still nonexistent around the globe, U.S. stocks like AT&T, with its 5.6% yield, should continue to propel the averages still higher in 2015. Must Read: Fifteen Fabulously Intelligent Biotech Stock Predictions for 2015 Lightning Round In the Lightning Round, Cramer was bullish on Walgreens , Rite Aid and CVS Health . Cramer was bearish on Integrys Energy Group , Navios Maritime Partners , Tesla Motors and The Bank of Ireland . No Huddle Offense In his "No Huddle Offense" segment, Cramer offered up some facts about what lower oil prices means for our economy. Cramer said that only 16 states benefit from higher oil prices and only 10% of the U.S. population lives in those states. That means for 290 million Americans, lower oil prices are a good thing. While it's true that 12% of the companies on the S&P 500 index are oil or oil-related, for the other 88% of the index earnings estimates need to go up, not down, as a result of this tax cut on consumers. Cramer said some oil companies may default on their riskier bonds but most companies are in good shape and most banks can easily handle any defaults that may come. Lower oil prices will not kill off the Texas banking sector. Finally, Cramer noted that lower prices won't stay around forever. The velocity of the decline is frightening, he admitted, but investors need to see it through. Must Read: Exclusive: American Electric Power Taps Goldman for Power Plant Sale To watch replays of Cramer's video segments, visit the Mad Money page on CNBC. To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here. -- Written by Scott Rutt in Washington, D.C. To email Scott about this article, click here: Scott Rutt Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDCClick to view a price quote on WFC. Click to research the Banking industry.
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener. NEW YORK ( TheStreet) -- These are confusing times for the stock market, Jim Cramer told his "Mad Money" audience. There's always somebody telling you to do exactly the opposite of what you should really be doing. But Cramer said it's not about sounding smart, it's about getting it right -- what to buy, what to sell, what direction the market's headed. "You get those things right, and it's a heck of a lot easier to make money in this or any market," Cramer said. Must Read: Jim Cramer's 11 Best Stock Picks in the Technology Sector By doing your homework "you just might learn something that will make you a better investor," he said, and a better investor is one who makes more money "because that's the goal here." Cramer said he and Stephanie Link, the research director of Cramer's charitable portfolio, Action Alerts PLUS, recently went back over every trade AAP made over the last five years. Here's what Cramer has learned. Caterpillar had been going down for weeks on end as analysts raced to cut their estimates ahead of what looked to be a particularly bad quarter, Cramer said. The analysts had turned bearish after CAT's business globally took huge hits because customers were struggling to get credit for new machines. This was at the depth of the Great Recession. When Caterpillar finally reported, the quarter turned out to be even uglier than the analysts had predicted. But CAT's stock barely reacted to the bad news. "That's a classic sign that you're looking at a bottom," Cramer said. "The worst is over!" CAT roared and then rose. It may seem counter-intuitive to buy a stock right after the estimates have been slashed but when you think about it, it actually makes a lot of sense. JPMorgan Chase is another example of this, Cramer said. Must Read: JPMorgan's 6 Top Biotech and Pharmaceuticals Stocks to Buy in 2015 It seemed done for after its "London Whale" trading fiasco of 2012. However, just like Caterpillar in March of 2009, JPMorgan's stock didn't get hit after analysts cut estimates. Instead, it flat-lined and then actually inched up slightly. Once we learned JPMorgan's losses were contained at $6 billion, that was the moment we had to buy, Cramer said. If you did, you rode a huge rally. Coming Back for Secondaries Everybody makes mistakes sometimes, Cramer said. But if you want to become a great investor you don't just need to learn from your mistakes, you need to learn how to recognize what your mistakes actually are and notice what works. "We're full of all sorts of unconscious biases, and that can make it incredibly difficult to learn from experience," Cramer said. Think empirically, he said. After analyzing the last five years' worth of trades as part of his research for Get Rich Carefully, his latest book, Cramer came to another counterintuitive realization: Stop worrying and learn to love secondary stock offerings. Cramer said we're all conditioned to believe that when a company issues new stock it's bad news for shareholders. When a company does a secondary, it tends to weigh on the stock for a time. But these days that totally reasonable fear of secondaries is also a mistake because interest rates are still low by historical standards, Cramer said. For example, real estate investment trusts have done a huge number of these kinds of secondaries, and those deals have worked fabulously for investors. You can find these deals in all sorts of companies that were hit hard by the housing crash and are now snapping back, said Cramer. One example: mortgage insurance companies, a group that had pretty much been left for dead. Cramer mentioned how investors could have made a killing in Radian , a Philadelphia-based mortgage insurer, if they had listened to his buy call in February 2013. Cramer also likes the secondary offerings from master limited partnerships, the oil and gas pipeline players that are always issuing stock to finance their expansion plans to crisscross the country with pipelines. Must Read: 10 Stocks Billionaire David Einhorn Loves for 2015 Enterprise Products Partners , the new Kinder Morgan and MarkWest are the best-of-breed players here, and they've become serial issuers of equity to expand their pipeline networks. These companies can be risky if interest rates are rising, Cramer warned, but if rates are stable you should jump all over their secondaries. The bottom line, Cramer said: Forget the conventional wisdom that says a secondary stock offering always means a company is in trouble. Know When to Fold 'Em Like The Gambler of song, Cramer has some suggestions for when you should fold your positions or even run. "When it comes to picking stocks, cash is not always king," he said. In fact, if you buy a stock just because it's sitting on a mountain of cash, you could get crushed. Think about it, Cramer said: What do Cisco , Microsoft , Oracle and Intel all have in common? People were lulled into buying their stocks at very high levels simply because they had so much cash on their books, as if cash per se is always good news. What really matters is how companies put that cash to work. Cash can been wasted on undisciplined buybacks -- when you see a company doing that, you should pass on its stock and walk away, Cramer said. Contrast this with one of the best-performing stocks in the S&P 500 since the generational bottom in 2009, Wyndham Worldwide , run by Steve Holmes, one of the most shareholder-friendly CEOs out there today. Holmes buys back stock aggressively and when it makes a difference, particularly during those ravaging downturns when most other CEOs seem frozen. Holmes thinks it is his duty to return his company's excess cash to the shareholders via dividends, Cramer said. He's the model of what Intel, Microsoft and Cisco need at the helm. Here's another sign that you should fold. If you own shares in a company that starts blaming its customers for its own poor performance, it's time to walk away. Must Read: Jim Cramer’s 4 Best Stock Picks for the Health Care Sector "I learned this the hard way when my charitable trust decided to buy Juniper Networks , the maker of networking and communication equipment, back in 2011," said Cramer. Juniper encountered shortfalls and blamed a lack of Japanese orders in the wake of the tsunami and Fukushimi Daiichi nuclear disaster. But the stock continued to drop. He stuck with Juniper because the company had a ton of cash. Oops. Juniper's blame-the-customer act was a lame alibi, Cramer said. It turns out Cisco was taking market share the whole time and simply kicking Juniper's butt with a better mousetrap. There's a pretty simple moral here: When a company blames the customer, check to see whether the customer isn't actually still buying from a different vendor. Beyond EPS A huge part of this business is figuring out where a given stock is headed, said Cramer. That isn't always easy. Most stocks, most of the time, trade on their earnings-per-share numbers. When the earnings are headed lower, so is the stock; when the earnings go higher, the stock rallies, too. But for some industries, earnings are not the most important metric, said Cramer. If the only thing you're watching is the earnings per share, you could end up getting clobbered or missing some fabulous opportunities. Watch the key metrics for everything you own. For example, Cramer said, when it comes to oil companies, production growth is key. For many tech stocks, it's the average selling price of their products. In these two sectors, those metrics are more important that anything related to beating the earnings estimates. Devon Energy sagged due to production shortfalls, not earnings per share; Chevron rallied with lower earnings and higher production growth. Another mea culpa: Cramer admitted he totally missed the bottom for Micron , the semiconductor company that makes memory chips, back at the end of 2012. Micron's stock had been a dog for more than a decade. But then the stock jumped higher. "What did I miss?" Cramer wondered. Must Read: 5 REITS to Trade for Gains in December: Select Income REIT and More DRAMs, or dynamic random access memory chips, had a nice bump up in their average selling prices during the quarter. The DRAM business had been so horrible for so long that many companies in the industry had simply given up, Cramer said. So supply had become constrained. Micron's been off to the races ever since, more than tripling from December 2012 to December 2013. One last metric to note, said Cramer: When a company is based in the United States but does a lot of business in emerging markets, particularly China. One of the best buys his charitable trust ever made was picking up Yum! Brands , the parent of KFC, Taco Bell and Pizza Hut, off a sudden decline in Chinese sales because of a KFC tainted-chicken scandal, Cramer said. While Yum! is a worldwide outfit, the growth is in China. So when the Chinese KFC division had a shortfall, the stock got clocked, Cramer said. Soon after, Yum! let it be known that its earnings would be slashed as it boosted its Chinese advertising. You had to buy the stock on that shortfall, said Cramer. Not long after, YUM's Chinese business began to turn and the stock headed right back up to its 52-week high. KFC's sales growth in China is more important to Yum!'s stock than the actual reported earnings of the entire chain. As much as we'd like to keep things simple and just focus on the earnings per share, sometimes the truly important metrics can elude us if we don't keep our eyes on the ball, Cramer said. Anybody who waited for revenue growth to kick in missed the whole move since 2009. Some so-called experts tell you to wait for revenue to roar, but they've kept you out of some of the best stocks out there, he warned. Earnings are not always all-important. Let It Ride Finally, Cramer said, if you have a core holding in your portfolio, a high-quality stock with terrific prospects that you want to own for the long haul, don't sell it at the first little gain or the first sign of turbulence. If you really have conviction in a stock, you need to let it ride, Cramer said, because it is a core holding and want to own it through thick and thin. If you don't follow through with that, he said, it's almost always a big mistake. The temptation to take a gain is palpable. It's a difficult task to keep a fabulous stock riding in your portfolio, because you never want to let a gain turn into a loss. If you own a stock and you think it could go up over the next few years, then by all means keep it, Cramer said. But all bets are off if the business starts to deteriorate. What makes him so sure of this rule? Cramer said his trust rates stocks on a scale of 1 to 4 every week. Those rated 1 are, by and large, meant to be core positions, and he wants as many shares as he can get. However, looking back over the last five years he found it unnerving to see how many of these "1" stocks the trust sold because of short-term market turbulence, only for the stocks to continue roaring ahead. A core position is what it says it is: something that's integral to your portfolio. It should not be so easily dislodged, he said. Resist the urge to sell your franchise players, no matter how tempting it may be. Must Read: Jim Cramer’s Five Best Stock Picks for the Auto Parts Sector To watch replays of Cramer's video segments, visit the Mad Money page on CNBC. To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here. -- Written by Scott Rutt in Washington, D.C. To email Scott about this article, click here: Scott Rutt Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDCClick to view a price quote on CAT. Click to research the Industrial industry.
NEW YORK (TheStreet) -- The Energy Select Sector SPDR Fund consists of 44 companies, including two components of the Dow Jones Industrial Average. The energy exchange-traded fund has a year-to-date loss of 9.5%, with the price of a barrel of Nymex crude oil down 44%, ending Friday at $54.73. Crude oil set its bubble peak at $147.27 in July 2008, while the energy SPDR fund peaked at $101.52 on June 23, 2014. The energy-stock bubble thus continued to inflate for another six years. Three of the four energy stocks profiled today set new all-time intraday highs in 2014 before crashing with crude oil. Must Read: Dow 18,000: Why This Market Rally May Never Happen Again Here are profiles of four components: Two from the Dow and two others with gas stations. Dow component Chevron ($113.25) has a year-to-date loss of 9.3% but the stock plunged 26% from its all-time intraday high at $135.10 set on July 24, to its 2014 low at $100.15, set on Dec. 16 as its bubble popped. Chevron has been below its 200-day simple moving average at $121.67 since Sept. 24. The weekly chart shifts to positive, given a close above its key weekly moving average at $112.96, which lines up with the 200-week simple moving average at $112.97. Dow component Exxon Mobil ($93.21) has a year-to-date loss of 7.9%, but the stock slumped 18% from its all-time intraday high at $104.76 set on July 29, to its 2014 low at $86.19, set on Dec. 16 as its bubble popped. Exxon has been below its 200-day simple moving average at $97.80 since Sept. 8. The weekly chart shifts to positive, given a close this week above its key weekly moving average at $93.11 with its 200-week simple moving average at $88.87. Hess Corp ($74.31) has a year-to-date loss of 10%, but the stock plunged 39% from its multiyear intraday high at $104.50 set on July 30 to its 2014 low at $63.80, set on Dec. 16 as its bubble popped. Hess has been below its 200-day simple moving average at $89.19 since Oct. 7. The weekly chart shifts to positive, given a close this week above its key weekly moving average at $77.32, with its 200-week simple moving average at $70.14. Marathon Oil ($28.26) has a year-to-date loss of 20% and the stock plunged 42% from its all-time intraday high at $41.92 set on Sept. 3, to its 2014 low at $24.28 set on Dec. 16 as its bubble popped. Marathon has been below its 200-day simple moving average at $36.11 since Oct. 7. The weekly chart is negative but oversold, with its key weekly moving average at $30.25 and the 200-week simple moving average at $32.23. Here's the daily chart for the Energy Sector SPDR. Courtesy of MetaStock Xenith The daily chart for the energy sector ETF ($80.11) shows that this fund entered 2014 above its 200-day simple moving average (green line), then at $82.44. This ETF dipped below its 200-day SMA between Jan. 31 and Feb. 7, at $83.45, providing a buying opportunity for the run-up to the all-time intraday high set at $101.52 on June 23. From this high, the energy ETF plunged 29% to a 2014 low at $72.51 into Dec. 16. Here's the weekly chart for the Energy Sector SPDR. Courtesy of MetaStock Xenith The weekly chart for the energy sector ETF shows it had been above its 200-week simple moving average (green line) between Oct. 2011 and Dec. 12, 2014, and ended last week above this moving average, now at $78.75. The weekly chart shifts to positive, given a close this Friday above its key weekly moving average, at $82.04. The momentum reading shown at the bottom of the graph in red is rising above the $20.00 oversold threshold at $25.40. Must Read: The Best Cities for Under-35 Adults to Live: Based on Jobs, Housing and FunClick to view a price quote on XLE. Click to research the Financial Services industry.
NEW YORK (TheStreet) -- One list down, one to go. With Christmas out of the way, you have just a few more days to begin digging in to that other holiday list: The checklist of financial moves you should make before year's end. We've surveyed the landscape of financial advisers, brokerages and some of the finest financial minds in the publishing business (hat tip for the adapted line to Mr. Homer Simpson). Most of what we found breaks down into a handful of smart tips that will do you well in 2015. Must Read: Cramer: What Stocks You Can Still Buy in This Rally Category One: Mad Max No, not your credit cards! We mean it's time to make sure you max out your IRA contributions, use the maximum benefit from your flexible spending account (FSA) and get your charitable contributions into the mailbox. All of these will save you on taxes early next year. To avoid penalties, if you're older than 70-1/2, don't forget to take your minimum required distribution from retirement accounts. If you're in the red on a stock you don't love, selling it now will let you harvest tax losses in time for your 2014 return. The rules on FSAs have been loosened a bit this year, so you may be able to carry over up to $500, or delay spending the 2014 money you set aside until mid-March. But it's a good time to pay off any outstanding doctor-bill deductibles, or maybe buy a pair of glasses. Self-employed people might want to max out on the business expenses by Wednesday. If you need a new office chair or an extra computer, now's the time. Let Uncle Sam and your state pay up to half, depending on your bracket. Category Two: Procrastinate A very few things might benefit from procrastinating, and one is deferring income into next year if you can. For some workers, that may mean deferring payment of a bonus. For self-employed people, that can mean timing the outgoing invoices to make sure the money arrives in 2015. Must Read: Here's Why U.S. Economy Growing at 5% Is Good for Stocks The tactic will at least defer the time when you have to pay until you do first-quarter estimated tax returns. If your bracket is going to be lower next year, it can even save you some money over time. But be careful: If you expect to make materially more money next year than in 2014, the smart move may be the opposite -- to pull as much money as possible into this year. Category Three: Rebalance Yourself and Your Money Just as this is a season of resolutions, your money can benefit from a little extra holiday-season attention to planning. Some must-dos: 1. Rebalance your portfolio among stocks, bonds and other assets. Two years of double-digit stock gains may have you more exposed to equities than you want to be. If your plan two years ago was to be split 50-50, for example, you may be skewed 60-40 to stocks by now. The idea is to stick to the plan you made rather than to be seduced by a good year or two for a particular fund, or for stocks in general, that may end in exactly 2,008 tears. More or less. 2. Get ready to exploit trends emerging in late 2014 and 2015. There's been a bit of news lately. The economy grew at a 5% annual clip in the third quarter, the best in 11 years. Growth in Europe and China has been slowing. Oil prices have been careening downhill even faster than stocks did six years ago. What should you do? Here's some advice from pros. Think tech, T. Rowe Price Associates equities chief Bill Stromberg wrote in a year-end note to the firm's clients. "Despite their non-U.S. earnings exposure, a number of technology stocks appear attractively valued, given out expectatons for growth in mobile broadband, cloud computing and emerging-market consumer markets." Putting our money where his mouth is, T. Rowe's biggest tech holdings include Amazon and Apple in the New America Growth Fund; Amazon, Google and Priceline in the T. Rowe Price Growth Stock Fund, and broadband carriers like Verizon and Comcast in their Media and Telecommunications fund. Think oil, but carefully. Bank of America Merrill Lynch strategist Savita Subramanian argues there are ways to try to turn the oil drop to your advantage. One is to play names like Chevron and Exxon Mobil for their dividend potential, since they are financially as big and relatively steady as a tanker. T. Rowe also notes the possibility for "substantial rebounds" in some oil stocks. But stockpicking may be risky: With capital spending by drillers expected to drop, a lot of equipment and services companies might take more losses. Consumers will save money on gasoline, but they'll be likelier to spend it on staples than consumer cyclical goods, Subramanian says. Historically, staples-oriented companies like Wal-Mart , Dr Pepper Snapple and Kimberly-Clark have done better when oil goes down, she says. She also highlights airlines including Delta Air Lines and Southwest Airlines . Think international, BlackRock strategist Russ Koesterich says. With U.S. stocks trading around 17 times next year's expected earnings, they're no longer cheap, he writes. It takes guts, but Japan and some emerging markets may offer better value, he says. Or think local. Municipal bonds have had a big year, and look good for next year as well, Koesterich said. "Yields for longer-maturity munis rival or exceed those of their taxable counterparts on a before-tax basis, and this only increases the after-tax value,'' he wrote. Must Read: Dow 18,000: Why This Market Rally May Never Happen AgainClick to view a price quote on GOOGL.
NEW YORK (TheStreet) -- As we count off the final days of 2014, it might be wise for taxpayers to take last-minute steps now to lower the amount they'll have to fork over to Uncle Sam in April. Tax-loss selling, charitable donations, and IRA and Roth IRA contributions are among the moves that can shrink that bloated tax bill. But many of these tax-lowering steps must be taken before the ball drops on New Year's Eve. Must Read: Warren Buffett's Top 10 Dividend Stocks Taxable accounts need the most scrutiny, said Dan Neiman, partner and portfolio manager at Neiman Funds and investment advisory firm, Independent Solutions Wealth Management, which have more than $400 million in assets under management. Start by examining the account's short-term and long-term gains and losses for the year. "Find out what their long-term and short-term capital gains consequences have been for the year so far," he said. "Some people pay attention to those things through the year and some don't." If there are losses, then this is an opportunity to take profits by selling shares in some high-flying stocks or mutual funds without facing a tax burden. "A lot of people are afraid of the tax consequence, but if you've had a good year and met your goals and have some tax losses, then there's no harm in taking some of those profits," said Neiman. If the investor is already facing capital gains, then it might be wise to sell some of the duds. For retail investors, this decision is sometimes tough. Must Read: 12 Stocks Warren Buffett Loves in 2014 "You can't look at something you bought for $60 -- and it's down to $50 -- and try to hold on to it until it goes back to $60" if the fundamentals don't support it, said Neiman. The person must assess the situation objectively: Is it more likely this stock will bounce back 20% in the next year or can I get that kind of gain by investing in another stock or mutual fund? This is where the investor has to look at the stock without emotion and bite the bullet. If there is potential in the beaten-down stock, then don't sell. Instead, buy more on the cheap. Neiman said he bought Chevron at $115 a share in early October and woke up the day after Thanksgiving to see the stock at $108. "There was an opportunity to buy more," he said. "I like the oil stocks as a fundamental value play for their dividend, long-term potential growth in earnings, and low debt -- so when they're off 5 or 6 percent, I'm a buyer." Also, carry-forward losses from last year can also help to offset gains. Investors can also use tax-loss selling to rebalance a portfolio heading in to 2015 by selling off the losers and reinvesting the money into stocks and funds that offer more prospective growth. It's critical though that the person assess a stock's potential before selling it. "You may be missing some upside because of the 30-day wash sale rule," said Neiman. Under the wash sale rule, an investor, who sells a stock to take a loss, cannot buy back that stock for 30 days. Then there are the tax surprises. Perhaps a year-end bonus comes in higher than expected. Or maybe a mutual fund announces an unexpected year-end capital gains distribution or a company decides to issue a special dividend -- all of which could push the taxpayer up into the next tax bracket. Yikes! Must Read: 10 Stocks Carl Icahn Loves in 2014 This is particularly common in a bull market, said Neiman. "Any fund that's heavy into tech or any fund that's gone up quite a bit and beaten the market averages, there may be some large capital gains taken in that fund that may cause a big distribution." Investors can find these potential tax landmines by inquiring about year-end bonuses early and by looking up dividend and capital gains distribution announcements made by each company and fund in their portfolios. History is not always the best indicator. Some mutual funds, such as Putnam Voyager Fund and T. Rowe Price Blue Chip Growth Fund , will be making capital-gains distributions before year-end for the first time in many years. So re-examine this issue each year even if a portfolio has not changed much. Charitable donations is another tax burner. Donations to registered charities can be done through cash, clothing, furniture, cars or even shares of stock. There are advantages to donating stock that's seen big gains. The donation is credited at the current value, not at the cost-basis level. So, the person enjoys the large donation without having to pay the capital gains on it, said Neiman. Making contributions to an IRA, Roth or other retirement account is another easy way to lower taxable income. Generally, people have until tax-filing day in April to make the contributions. Still, Neiman advises people to look at all of these tax steps earlier rather than later. "Don't wait until Dec. 30," he cautions. "Take a look at the performance now and what they've done for the year, and review your goals and what you're trying to accomplish for years to come." Must Read: 7 Stocks Warren Buffett Is Selling in 2014 At the time of publication, the author held no positions in any of the stocks mentioned. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage. TheStreet Ratings team rates CHEVRON CORP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation: "We rate CHEVRON CORP (CVX) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself." You can view the full analysis from the report here: CVX Ratings ReportClick to view a price quote on CVX. Click to research the Energy industry.