It is easy to overlook less recognizable stocks in favor of red-hot technology names, so Jim Cramer highlighted one under-the-radar powerhouse worth noting: the stock of Avery Dennison.
“It’s a stand-in for all those other little-known companies with stocks that have become seemingly unstoppable in recent months,” the “Mad Money” host said.
You may not know the name, but Avery Dennison’s products are everywhere. The company makes adhesive materials, coatings, and labeling and packaging products like graphic imaging and radio frequency identification tags, which help businesses manage their brands and track inventory.
But the company is not solely dependent on the retail sector. Its technology, which includes heat- and chemical-resistant labels for warning signs and adhesive films that make buildings look better, is so impressive that the stock has been a frequent visitor to the 52-week high list.
“Avery Dennison may not be sexy, but it’s one of the kind of unsung heroes that no one talks about. They just don’t,” Cramer said. “Would I recommend buying it? Sure, I think the stock could have a lot of upside.”
Aside from being tech-savvy, Avery Dennison has also been forward-thinking, delivering steady revenue growth, strong earnings and high value products while making strategic acquisitions and paying a good dividend.
“What really matters here is that this market’s recent rally is not just about flashy tech stocks that so many investors feel uncomfortable with,” Cramer said. “It’s also composed of boring, steady-eddie players like Avery Dennison, and as long as this kind of stock is leading the way, I feel good about the norm of the market, since this company is the definition of normal — the regular American Joe stock that’s worth investing in any day of the week.”
Then, on a relatively tame day in the stock market that can be easily dismissed, Cramer wanted to give his reasons for why investors should never lose sight of their underlying concerns.
So the “Mad Money” host shared his list of six concerns that, if realized, could have sway over the market’s movements in major, potentially catastrophic ways.
“I give you this list not because I’m a bear, and not because the market is down hard today, the first time in four sessions. It’s more because I want you to know that I have a list and I check it constantly. I always add new things to it, because that’s what you do if you’re a pro,” Cramer said.
When Blue Apron filed for an initial public offering, market watchers including Cramer thought the increasingly popular, tech-oriented meal kit service would blow investors away.
“That’s why the Blue Apron IPO was one of the most eagerly anticipated deals of the year. It seemed like investors were practically salivating for this one,” Cramer said. “Yet the actual IPO, it’s been a total bust from start to finish, and, fairly or unfairly, its weakness is giving other digital startups a bad name.”
So Cramer decided to look into what the botched IPO means for both the IPO market and other venture-capital-backed tech-related startups interested in going public, especially considering how promising Blue Apron seemed before it came to the public market.
Finding early-stage investments for budding companies can be difficult, but Jason Frishman, the founder and CEO of private fundraising company Netcapital, has built one solution.
“There’s lots of different options for early-stage company financing, but it’s really hard. And so what we do is we allow you to raise money from anybody. Not just the general partners in Boston, New York and San Francisco, where 80 percent of venture capital is invested, but from your friends, from your family, from your customers, from your fans, from your followers,” he told Cramer on Thursday. “We’re really turning this on its head and making it so that you can leverage the power of your popularity to accomplish your fundraising goals.”
On the surface, Netcapital is another private equity and venture capital firm, but its differences lie not only in that it broadens the fundraising effort for entrepreneurs, but also that it makes it easier and more accessible for the average home-gamer, Frishman said.
Finally, Cramer looked across the pond to Europe, where one Italian bank’s seizure could mark the start of an economic overhaul that pushes European markets out of their lull.
Earlier this week, the Monte dei Paschi di Siena bank was seized by the Italian government and given a $6 billion bailout to heal the bank and help it out of its run.
With two similar Italian bank bailouts, a €13 billion rights offering for major Italian bank Unicredit, a €8 billion takeover of the Spanish Banco Popular by its competitor Banco Santander, a €4 billion rights offering for Credit Suisse and a €8 billion rights offering for Deutsche Bank all occurring this year, Cramer takes them as signs of a true pickup across Europe.
“This plethora of deals finally breaks the logjam that’s plagued all of Europe for years, and it’s why we should begin to expect a rather dramatic pickup in growth across the Atlantic, even as the numbers have already been pretty darned good for Europe for about a year now,” he said. “I think these rights offerings, and the concomitant write-downs, are going to spur growth and keep the euro rising. It’s why I dislike European bonds and why I like Europe’s stock markets, as well as their currency, the euro, which can be captured best by buying the EZU, the MSCI Eurozone ETF that we own for my charitable trust.”
In Cramer’s lightning round, he rattled off his take on some caller favorite stocks, including:
Halliburton: “Good company, bad neighborhood. Don’t want to be in that neighborhood right now. Let’s look at that rig count [on Friday], but right now, these stocks are in purgatory.”
J.M. Smucker: “It’s such a good company but that’s such a tough business right now. The food business is just… I mean, even Mondelez, a cyberattack hurts them for 300 basis points. Everything seems to be going wrong in this business. I want to say wait for Smucker. Let’s wait.”
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