US stocks thriving amid Europe's storm

Two in particular have risen 20% and 33% this year. There are hundreds more for the taking if investors would just look past the gloom across the pond.

By Jim Cramer Jun 13, 2012 9:53AM

Do we really need more stocks to buy than foods, drugs, restaurants, utilities, real-estate investment trusts and retailers?

 

I think people forget that there are whole periods when only a couple of groups actually make you money. We have had waves during which health care stocks did terrifically and that's about it. We have had moments when only oil stocks worked. We have had moments when the only real gains were in technology.

 

So why should we care that the stocks that are going up aren't in big groups like financials, tech, energy and industrials? Isn't it enough that we isolate companies that have little international exposure and big dividends or, alternatively, some international exposure and little economic sensitivity?

 

Where is it written that we have to be in more than those stocks while we wait for events to unfold in Europe?

 

I know what the smartest people in the room are thinking: You can't own anything, because when the big bang occurs in Europe, everything will be crushed.

 

But here's the riposte to that: Perhaps a big bang doesn't happen. Perhaps Europeans just get mired in a terrible recession that brings down more technology stocks, more industrials and more oils but leaves domestic companies intact to climb higher.

 

Let's consider the cases of two purely domestic stocks, Dunkin' Brands (DNKN) and Dollar General (DG). I mention these because the odds are that if you look around your town, you will likely see these stores.

 

They are like Edgar Alan Poe's purloined letter, hiding in plain sight.

 

Now, let's go over what has happened to these chains in the time that we have waited for Europe to implode. Let's figure out how they have done while the Spanish and Italian 10-year bonds have risen in yield and Spanish banks have run short of capital. What's been their performance as Greece is obliterated?

 

First, Dollar General is up 20% year to date, and Dunkin' Brands has gained 33%. Those moves have happened despite dithering by the European Central Bank and German intransigence. These have been incredible moves, but perhaps more important, not only do they not have any European exposure, they also have very little California exposure. Dollar General, with 10,000 stores, is just now opening 50 stores in the state that represents one-fifth of the U.S. population. Dunkin' Donuts has just opened its first store in California. We know that domestic retailers put up their best numbers during a regional to national expansion, and both of these companies still have their runways ahead of them.

 

Now ask yourself whether you should have known about these two companies and whether you could have gotten in at a discount at any given time. The answer is you sure could. Dollar General has done three successful secondaries during the time that Europe has been teetering. Dunkin' Brands has done two secondaries within the past year.

 

That's visible.

 

I simply don't understand why you have to be on the sidelines, away from these stocks, because of Europe. They are there for the taking. They don't do business in Italy or Spain. They are two among hundreds I could name that have done so well during this period. I say Spain and Italy and Europe in general make you work harder to find bull markets, but they are bull markets and Europe is no excuse to miss them.

 

 

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 has no positions in the stocks mentioned.

 

 

 

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20Comments
Jun 13, 2012 7:58PM
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When most of these companies were issuing downward guidance and cautionary statements last quarter most discerning investors aren't exactly going to be running for their ameritrade 'easy' buttons.

JC is nothing more than a highly educated used car salesman.

Jun 13, 2012 7:03PM
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Don't be a JC hater.  He is consistently wrong.  Just do the opposite of what Big C recommends.

Jun 13, 2012 6:54PM
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Hey Cramer  What was yesterdays weather  Wow your right again
Jun 13, 2012 4:27PM
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If you look at the NAVs of the big mutual funds compared to where the Dow,NASDAQ AND S&P are now compared to before 08 blowout at  the same indices the current NAVS are lower. Its a fake recovery folks.
Jun 13, 2012 4:24PM
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**** this bald-headed, smarmy buffoon!Anyone who trusts a former hedge-fund manager, who are about the lowest of the low, is a ****ing idiot!

Jun 13, 2012 3:45PM
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"They don't do business in Italy or Spain."  Very good point.  That's what makes U.S. utility stocks with good dividends so popular.

 

 

Jun 13, 2012 3:40PM
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 Cramer always promotes the market.  I don't believe anything he says .just trying to drive the market up. Regardless of company values.
Jun 13, 2012 3:36PM
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From where did Cramer get the nickname "BoBo" ? 
Jun 13, 2012 3:07PM
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Cramer said that there was no catalyst for Disney to go higher! Then Marvel Avengers came out. It went higher. A huge percentage of visitors to the parks are Europeans and an even higher percentage use the Disney Cruise Line because their currencies are 25-56% more valuable than the U.S. dollar and this gives them huge discounts on buying our products. Disney is going up, Jim, because the European middle-to-upper classes are still spending money. What recession????

Jun 13, 2012 2:29PM
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Pretty pathetic, Jim. Dollar General? Yes, let's lift some giant warehouse full of imported junk stuff shipped to outlets that hold local economies helpless to re-invent and stabilize themselves. There comes a day when we just cut bait on items that would have failed Quality Checks when we did them or blew the needles off toxicity gauges (like lead paint on kids' earrings). Just say NO to the likes of Dollar General and get back to making the things we used to-- locally again and only in quantities we can manage. Dunkin? Who? Oh... more coffee you can buy on the run? Most of us are either unemployed or under-employed, so convenient income sappers should be on the way out. Our old useless bosses who stole our jobs and didn't do them well since-- always bought coffee because she couldn't wait to escape the home in the morning. That's not a reminder I want to be reminded about. Business ruiners are not the type of stocks I would consider a "good" sector. 
Jun 13, 2012 1:48PM
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Why do people continue to listen to this jack-*ss? This is the same man who was quoted in 2006 as saying "if every loan in 2006 that was subprime blew up…we would still not notice." Anybody who takes financial advice from a man who hits himself with an inflatable hammer deserves what they get.....

Jun 13, 2012 1:13PM
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A fifth of the US population = 60 million. I think California is more like 30 million. Just keeping it honest. 

Jun 13, 2012 12:47PM
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Sure Dollar General is doing great Jimmy- It is the only place that people can afford to go and buy food after listening to your horrible advice over the years.

Look- Europe has a great chance of imploding before too long Jim. Germany has just stated that for their Sociaist Paracite Neighbors to get any money they are going to have to give up some of their autonomy and allow Germany to have a say in their economic decisions in the future. With certain politicians in Ireland making rediculous compaisons between Merkle and Hitler already, I do not see how yo can expect France, Italy, Greece, Spain, or Portugul to make this concession.

By the end of September Eurozone as we know it will no longer exist and the Euro a a currency is going to be gone.

 AND WE WILL ALL BE BETTER OFF IN THE LONG RUN.

Jun 13, 2012 11:51AM
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Thanks for reminding me. Think I'll go have a couple donuts.
Jun 13, 2012 11:25AM
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not only does he make money on his horrible newsletter,  he also makes a bundle by

having CEO'S on his show to pump their stock and then dump at a profit

 

if he could make money picking stocks he would be doing it at his hedge fund instead

of busting out and becoming a prostitute pump and dump con man

Jun 13, 2012 11:16AM
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"Edgar Allen Poe's purloined letter" ????  What in the world is that referring to?
Jun 13, 2012 10:41AM
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lets consider your all american 5 that you picked on friday

first of all you said 5 stocks but only gave 4...AAPL ETN COST CLX

and once again they are lagging the market

so in answer to your question , that's why we don't buy your individual stock picks

we also don't buy them because you have a terrible track record

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