Dow Jones (NYSE:DJ) owns Barron’s, and Dow Jones is about to become part of Rupert Murdoch’s giant News Corp. (NYSE:NWS).  It just seems hard to think that the article isn’t a bit of "getting in on the in with Rupert," particularly as News Corp is about to launch its own competing business news channel to compete against CNBC.  Here is a link to the whole article at Barron’s Online for your review.

The more stocks someone covers, the more ‘marketesque’ returns they will have and the commissions compared to an index fund may drag it lower.  But in good times and bad, people love to talk about their best stock pick.  Sometimes it will be better and sometimes worse, but it comes down to a basket and the more diverse and broad a basket gets the more it is going to look like the market.  It seems every media focus wants to slam Jim Cramer at some point.  Sometimes I agree with his picks and sometimes not, so creating a "Full Basket of Cramer Picks" and trying to assign a performance to it just seems beyond reality.  Besides that, media get great coverage when they slam another pundit.  He’s loud, highly opinionated, a risk taker, and boisterous.  But no critic seems to get the point of Jim Cramer, even though Barron’s lightly addresses the good side and his track record.  This is about a lifelong process, not about every single individual pick for a week or a month or a year.  He’s trying to get you to think about the process, and yes of course recommendations and opinions come into play. 

The main question the article raises is this: How are viewers supposed to know that they should pay attention only to this subset of stock picks each week and ignore the thousands of others that Cramer makes on his show?  The answer is as simple as the question: If a scenario is one you don’t understand or don’t agree with, then you don’t invest in it.  Better yet, if you are using it for an educational lesson about how to think over a lifetime and how to look at things from sometimes unconventional viewpoints, then you’d only want to try a coat tail riding when you have strong conviction.  Barron’s readers by and large tend to be more sophisticated readers than most other financial shows and publications, so you as a Barron’s reader would probably answer "I would only follow him if it made more than enough sense and I wish I had found this or thought of that." 

The article says that CNBC officials said stocks should be bought a well after the coverage and, that the show is mainly educational, and not just about stock-picking.  The article does take a little bit of both sides and points out that with 7,000 picks in a year it’s hard expect much else.  But doing any direct tracking is like applying unproven and unknown theory to generally accepted fact.  Sometimes a theory will do better and sometimes it won’t, but there are times and ways to show results that support whichever side you want to show.  The article talks about the "Cramer Effect" where shares gap up 2% on average and then tend to go sideways or down for a period.  Oddly enough, the same has been true quite frequently in a "Barron’s Effect" on Mondays and even a "Business Week Effect" on Friday’s.  On April 21, 2007, Barron’s ran a feature with the "BUY YAHOO!, IT’S CHEAP" and we took issue against their article with the thought that it was too soon to make that call; shares closed that Friday at $27.47, briefly traded north of $30.00, and now they sit at $23.54. 

The Barron’s article against Cramer also points out how some of the calculations on his returns were not correct. This is sort of funny because daily Cramer tells you to wait and do your own homework and not to chase his feature picks right after the gap and never in after-hours trading.  So any entry price is theoretical at best, and many positions are ones that investors strong on their own opinions would simply ignore.  When it comes down to certain features, those become worth tracking as they are pretty hard lines in the sand, there are some that tend to get more following:

Cramer’s "TOP NINE PICKS FOR 2007"

Cramer’s "MORTGAGE MADNESS INDEX"

Cramer’s review of Warren Buffett Picks, and a review of 10 more of his picks.

Cramer’s 5 CHINA PICKS, although he makes the point over and over that this is only if you insist because he doesn’t trust investing there.

Cramer’s "New Four Horsemen of Tech"

He even gave a review of DJIA component stocks in 3 batches to come to his year-end target: the first batch of 10; the second batch of 10; and the third batch of 10.

Some will certainly send in emails on both sides of this, because italmost always happens since the Cramer followers and critics are often so polarizing.  None of those emails will be opened or responded to.  I will be the first to admit that no one should follow every pick from anyone.  Not from Cramer.  Not from us.  Not from bulge bracket brokerage analysts.  Not from independent boutiques.  Not from your bar buddy with a tip.  Do only what makes sense.  That doesn’t mean you can’t learn something along the way. 

Personally I know people that have made money both ways off Cramer: where they have made money by going where they wouldn’t have but it seemed right, and others who have shorted his stock picks after a 10% gap-up.  So take it for what it is meant for instead of using his picks as a dart board and then looking for someone to blame if it doesn’t work out.

Jon C. Ogg
August 19, 2007

People apparently like Yahoo! for its e-mail, social network (does it have one), and large number of websites devoted to individual topics.

Among other internet properties the Ask.com (IACI) search engine rose markedly in customer satisfaction ratings, up 5.6 percent to 75 points. And, Reuters writes Time Warner’s (TWX) "AOL, which has moved its focus from Internet access services to become an ad-supported source of e-mail and entertainment, slipped more than 9 percent to a score of 67 points." That rating is about the same as the one that the IRS got in the same survey.

The problem it these surveys is that they make good headlines, but appear to have nothing to do with whether any of these companies can make money. People, it would appear, go to Google for search. Search is inherently a more profitable business, at least in the way the internet works now.

Functions like message boards and e-mail are far less desirable to marketers. They are less targeted and do poorly in terms of getting online advertisers results.

Love Yahoo!, but don’t buy the stock.

Douglas A. McIntyre

It seems that despite Panama and despite new management that shareholders just aren’t going to give the company a pass for a few quarters.  Jerry Yang stepped back in and the company hasn’t had a good run at all since then.  The prior 52-week low was $22.65 intraday and shares reached as low as $22.44 earlier today before recovering. 

Google (NASDAQ:GOOG) trades at a discount on forward numbers compared to Yahoo!.  Yahoo! is also only cheap if you consider that its shares traded north of $40.00 about 18-months ago.  So the stock appears to be on sale when the underlying business isn’t.  Yang has his work cut out for him even more now Chief Yahoo! and it’s a wonder that no one has said "Could we please get Semel back?".

Jon C. Ogg
August 6, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

This is one of the last research summaries that Goldman Sachs will be issuing before the earnings deluge comes.

The first and foremost call was a Downgrade on Micron (MU) to a Sell from a neutral.  MU is still up pre-market after wider losses, but it was up much more last night.  It sees 17% downside to the stock.

Goldman is making a switch in its investment manager coverage:  It hasraised Janus (JNS) from Sell to Neutral, and downgraded Calamos (CLMS)from a Neutral down to a Sell.

Some of its INCREASED earnings estimates are on the following: Gilead(GILD), OSI Pharma (OSIP), Packaging Corp of America (PKG), Research inMotiuon (RIMM), Smurfit-Stone Container (SSCC), Yahoo! (YHOO).

Some of Goldman’s DECREASED earnings estimates are in the following:Affiliated Managers Group (AMG), AllianceBernstein (AB), Biogen-Idec(BIIB), BlackRock (BLK), Calamos (CLMS), Bowater (BOW), Cohen &Steers (CNS), Federated Investors (FII), Franklin Resources (BEN),GAMCO Investors (GBL), Legg Mason (LM), Huntington Bancshares (HBAN),MedImmune (MEDI), T. Rowe PRice (TROW), ViroPharma (VPHM), Waddell& Reed (WDR), Nuveen (JNC), Eaton Vance (EV).

Yahoo! (YHOO) estimates were raised by 2% revenues and 3% EBITDArespectively for 2007; price target raised from $31.50 to $35.00.

Maintained buy and positive ratings on Marvell Tech (MRVL), BEA Systems(BEAS), and Research in Motion (RIMM).  On Micrchip Tech (MCHP) Goldmansaid it has some positive takeaways from the company’s competitors andcustomers, but it is not yet making any changes to its Neutral ratings.

Jon C. Ogg
April 5, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Shares are up roughly 10% to $5.10, but the 52-week range is $0.86 to $8.60.  We won’t try to kill the notion of this and we don’t want to add more fuel to the fire.  But it should be noted that this name has been out there before and nothing really surfaced.  At one point this one got its fame (or notoriety) from Mark Cuban taking a stake and subsequently selling on the pop before the ink was dry from stories being printed that he had taken a stake.  Anything is possible, but there are as many skeptics in this name as there are believers.

Jon C. Ogg
April 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.