2 stocks that should blaze ahead this year

Remember when I said you want to buy a pullback? Take a good, long look at these stellar names.

By Jim Cramer Feb 6, 2013 10:18AM

thestreet logoArrow Up Photodisc SuperStockSo, on Tuesday, I said that you want to buy a pullback. But little did I realize that, by Tuesday night I would have not one, but two companies with stocks that fit precisely with that description. Both are consistent. Both are top of their industries. I think both are already set up to have a terrific year.

 

The first is Eaton (ETN), which reported a very confusing quarter because of its Cooper acquisition, but which gave you a $0.25 accretion figure that blew me away. Put simply, so much is going right for Eaton that it's amazing. Everything from the aging of the power grid, to the need to control energy costs, to the fluid controls on a plane or in oil-and-gas drilling -- this company's all in. Eaton has gone from a company that used to live and die with Class 8 truck builds, to a name that represents the ultimate in power-grid accountability, be it fixing Hurricane Sandy's damage or insuring the Super Dome never goes down again. This is an incredible story.

 

Plus, I believe we'll be seeing a dividend boost here very soon, and I bet a stock-buyback will start up in order to clean up the overage from the Cooper deal. The Cooper deal makes it possible for the company to spin off truck and auto -- although, put simply, I don't think Eaton wants to do this. It is cyclical. The rest is much more secular.

 

What a story. CEO Sandy Cutler is about as close to an industrial genius as you are going to get in this country. Is there a more important part of the bottom line than managing power? No. He's done a remarkable job putting these two together, and he will be taking share for years from this deal.

 

But maybe you don't want a growth cyclical. How about a growth pharmaceutical name? Remember those? Allergan (AGN) is probably the premier growth pharma out there. On my Mad Money show, every quarter I have on David Pyott, the incredibly smart CEO, just like I have had for years and years. I always have to start the segment by talking about how the guidance is conservative and that buying it on the weaker guidance is a terrific way to make money, and it has continually made money.


I have always liked it, because each year Allergan seems to unveil a blockbuster drug that just takes off. That includes last year's migraine drug and this year's overactive-bladder compound, all off of Botox.

 

This year, though, because Allergan has agreed to buy Map Pharmaceuticals (MAPP), Pyott has got the possibility of an at-home delivery system for a migraine medicine that could benefit millions of sufferers. It is an April proposition, and Pyott seemed awfully confident.

 

Who knows what will happen if he actually can compete with Regeneron's (REGN) Eylea on the macular-degeneration front with a formula that requires a much smaller number of injections? Who knows if it will be approved? Allergan is currently in stage two, but it is a terrific opportunity.

Most of the pharmas I deal with thirst after anything blockbuster, but they spend most of their time selling drugs -- many "me-too" products. Allergan's the real deal. Botox is a pipeline within a drug itself, and the company has a huge research-and-development budget to keep it hitting it out of the park. Only Allergan, Gilead (GILD) and Celgene (CELG) just keep delivering time and time again.

 

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and is long ETN.

 

 

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25Comments
Feb 6, 2013 1:00PM
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We don't need to see share price fall to lose money in the market.  The alternate investment for smart folks and economists is the "true" barometer.  Or as we should all forsee, the least loss alternative, and that is a hard lesson to learn.   Monies throughout the world are now under immense pressure.  When we see these monolithic Corporations hoarding sooo much money we should all see something is very wrong.  Confidence in life means so much and it is no different in the market or ones personal life.  Creativity and Innovation are absent America at this time.  Free trade and outsourcing have dumbed business down to a mere survival mentality.  These CEO's just stand and look at each other without a clue as to why and how they were roped into this mess.  At this point they are merely telling themselves money is all there is. The subtelties in life like values, religion, character, and personal freedom have been masked over by politicans primarily because individuals no longer have training as youngsters in developing a personal compass.  Corporations are made up of people and they react very similarly.  As individuals hoard out of fear corporations will do the same.  The birds have come home to roost. Where it goes and how it will end up is as risky as foretelling the market.  But one thing for sure, we all share the feeling something just isn't right.
Feb 6, 2013 11:46AM
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...I still don't see how one can be excited by the stock exchange as long as bernanke is printing gobs of money and injecting it into the mkt....tell me where i am wrong....
Feb 6, 2013 12:58PM
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Similar problems have plagued Japan for more then 20 years...

I don't know if they have became accustomed to the plights or what..?

Maybe they are just more accepting, as a group of people ?

 

Then they were devastated by Earth Quakes and the Tsunamis....

So maybe we are luckier then most..?

But our problems as a Nation, are not going away anytime soon...

Feb 6, 2013 10:45AM
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Home Depot hiring 10,000 addition temp workers this year, perhaps further evidence supporting Togs mortgage trade?

On the verge of a 3 to 5% correction?  Earnings have been pretty good so I don't expect to much of a drop.  I think the gloom & doom crew will have to wait a bit longer for the next meltdown.

Feb 6, 2013 12:08PM
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Yea hardly, Chris. You can think recovery with so much artificial shuffling going on but each and every dollar of it impacts the one thing that cannot be artificially created-- confident customers. There isn't a pulse to these extremely expensive leg-less moves and the continued denied output of fiat money has no positive effects. The more there is (and worldwide we supassed a quadrillion months ago) that isn't appearing at all in paychecks, Main Street and genuine equity... the more diluted it's actual power is. A family anywhere in the world that isn't linked to the Kool Aid Stand is falling behind. It doesn't matter if we are talking Europe, America, Meso or South America, Asia, Australia or Africa... real people who did work are compromised by paper and button pushing freaks attempting an administrative take-over by social network connectivity. All well and good but at least 4 different scenarios are in play suggesting 1 or more will become party-poopers and cave it all in for the fun or greed of it. There is, there was and there always will be only ONE WAY to recovery--- let the crap fall and rebuild starting with a better foundation. We're completely on the wrong road.
Feb 6, 2013 2:03PM
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1:00 pm and up about 5 points, better then the -40 points we started at.

Take that scumbags!

Feb 6, 2013 2:13PM
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Anybody who can explain why now giving even more free money to the Internationals will solve anything is beyond me.  They already have more money that they know what to do with.  Politics?  Now that is one stupid game!

WASHINGTON (Reuters) - The chief of a group of more than 200 CEOs said on Thursday that President Barack Obama had told the business community last month he might back a territorial tax system, a regime that would exempt offshore corporate profits from U.S. taxation.

Corporate America is pushing for the United States to move to such a regime to make businesses more competitive against foreign rivals that pay no taxes on overseas earnings. The United States currently taxes corporate profits earned abroad only when they are brought into the country.

In 2011, then Treasury Secretary Timothy Geithner privately agreed to move to such a regime in failed talks with Republicans to secure a major budget deal, according to aides present.

During last year's presidential election campaign, Vice President Joe Biden criticized a territorial tax system, employing populist rhetoric to blast companies that shift their business and jobs abroad.

John Engler, president of the Business Roundtable, a CEO lobbying group, said that in meetings during last month's budget standoff between the White House and Congress, Obama was moving back in the business community's direction on the issue. 

Feb 6, 2013 8:38PM
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We were able to hold....Shows how resilient this market is...We take flat any day of the week....Of course manipulators not pleased at all, we expect them to come out tomorrow with guns blazing...Oh well, we will see what happens.
Feb 6, 2013 12:34PM
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ker plunk....quit watching fox news.....the market has doubled under obama and the money

being sopped up by the corporations is the very money bernanke is printing.....as long as bernanke prints wall will take..........you should have been taking too instead of listening to conservative talking points

Feb 6, 2013 11:33AM
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There is no rally or blazing stocks this year Cramer ! The stock market is a rigged game to enrich the elites and the Criminal Banking Cartel with the help of government and politicians=(TBTF)=SCREW THE SMALL INVESTORS=SCREW THE AMERICAN PEOPLE ! This market will CRASH in 2013  !
Feb 6, 2013 12:29PM
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VL

I completely agree that the world/USA economy has many problems.  Europe is a mess, China is subsidizing the destruction of western economies, government debt is crushingly high for federal, state and local all over the world, pensions are unfunded, wall street is full of criminals as are the banks, consumers are heavily in debt and many are falling behind, unemployment and crappy employment are a serious problem, student debt is epic and inflation in the basic necessities is gaining.  All of these things are there and if a catalyst occurs could trigger something very bad.

However I just don't see it happening this February, or this quarter.  In fact I think we have 6 to 9 months at least as the Fed can keep it propped up for a bit longer.

Feb 6, 2013 11:59AM
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All games are "rigged" if you are talking about Casinos...Well,I guess Wall St. is one of the biggest.?

 

Saw a women win $2300 dollars a couple nights ago...The "rigging failed in her favor.."

 

Maybe the same will happen with Wall St....Wouldn't that be nice?

 

I left the tables, Black Jack, and MS Stud poker about $260 ahead, I was happy..

Que Sera, Sera...

Feb 6, 2013 11:18AM
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TOG & Miss Lilly.....Own HD also, consolidated down from Lowes and Home Depot to just the HD.

 

Outside of a Tobacco play...Home D. has been one of our best(2nd) performers.

Feb 6, 2013 3:09PM
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We gave it the old college try but right before 100 hrs scumbags called to accelerate the selling so down we go again....Low volume and plenty of manipulators is never a good combination...Lets see if we can hold these last 2 hours.
Feb 6, 2013 10:53AM
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Eaton is another "TYCO" company (Take Your Company Over) who really has lost their focus on what exactly is it that they DO? 

 

from the engineer's desk, they supply detail parts and components.  except they didn't design or develop most of what they sell so "they" as a company are weak in support of anyone USING their components in new applications.....

 

they are another HP.  they just look a little different

Feb 6, 2013 12:21PM
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I think it is called Quantitive Easing......Kept us from going under as a Country.

 

We can not pull all the Table Legs (supports) out at once..Table will fall, like Humpty-Dumpty..

Remember him, and something about the "King's Men."

 

Well with normal pullbacks we can probably survive ??

The other option, was a total failure and collapse.,along with the inevitable Depression.

Businesses and Individuals would have been destroyed.

We will pay for this many years, but a total collapse would have been worst...IMO

Feb 6, 2013 11:21AM
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I see Mr. Cramer....Is on the "ball"...Mentioned Bio-Techs this A.M. on his yesterday's Article..

And kaboom,wheee, walla walla, viola...

 

Now Mr. Cramer....Let's have some opinions on Spectrum Pharma (SPPI)...Please..

Feb 6, 2013 12:30PM
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Call it a House of Cards, but right now it's the only House we have, unless you have faced foreclosure.

And then if that be the case, I feel sympathy for you...And best of luck in future endeavors.

Feb 6, 2013 11:26AM
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I would "expect" a 3-5% correction and I concur...

We had big run in January..

Healthy Markets correct....And then look or attempt the next leg up...

Many Companies are looking fairly decent, with slight guidance on the 2nd. Quarter.

But seem exuberant for 2nd. Half and Full Year.

Feb 6, 2013 11:25AM
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I`ll consider those stocks.Those of us that have followed his advice have made

a ton of money.Keep up the good work Jim.

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