Cramer's 'Mad Money' Recap: Get in the Game Now
Cramer said the first thing investors may notice is that SXC Health Solutions no longer exists. The company did a $4.4 billion merger in July and rebranded itself as Catamaran (CTRX) . Shares of Catamaran, however, are up 74% since last December.
Catamaran is still a great story, said Cramer. The new company has great scale to compete with the likes of Express Scripts (ESRX) . There is also a wave of patented drug expirations underway, leaving a wave of generic competion for Catamaran to capitalize on.
But there is a problem, noted Cramer, and that's Catamaran's largest customer, HealthSpring (HS) , which accounts for 10% of the company's earnings. HealthSpring has a contract with Catamaran through 2014, but the status of that contract will be known in January. Since HealthSpring was itself acquired, it may not be renewing its contract.
Cramer said Catamaran can eventually replace these lost earnings with new business, but that won't stop anaylsts from sounding the alarm in the coming weeks -- which is why investors need to sell ahead of that pending news. "Don't give up your gains," Cramer concluded.
Digging Into Mine Safety
There's always money to be made speculating on takeovers, Cramer told viewers, but only if it's done wisely. That means never speculating on a company with declining fundamentals.
Fortunately, in the case of Mine Safety Appliances (MSA) , makers of safety equipment for miners, oil and gas workers, firemen and those in the construction industry, business is booming.
Cramer said Mine Safety is a classic case of a stock that's unknown and under-covered by Wall Street. He said the company delivered a miss when it last reported, but that was only due to weakness in Europe, which accounts for 24% of the company's sales. As Europe continues to stabilize, Europe will become less of a factor, he said.
So who would be a buyer of Mine Safety? Cramer said both Honeywell and DuPont (DD) have long histories of making profitable acquisitions in this space, and either could be an acquirer. Mine Safety also sports a respectable 2.7% dividend yield.
No Huddle Offense
Cramer reminded viewers Citi anaylsts issued a buy rating on Apple on Nov 28 at $571 a share, only to reiterate that buy rating just days later. Since then, shares of Apple have slumped to $509 a share, where Citi, just 18 days after its initial recommendation, advised selling the stock. Since advising a sale, shares of Apple are now up to $534.