Is this a change from Cramer on his stance on Big Pharma? He is saying Pharma isn’t working this morning in TheStreet.com video today.
He said options are driving trading instead of fundamentals, and that is why Goldman (GS) is hugging $200.00; and he noted Texas Instruments (TXN) going up is a little illogical based on how bad the news was last night.
He thinks the drillers are winning from legislation and developments (Washington Post article) regardless of oil prices next year: he likes (CLB) Core Labs NV and (HAL) Halliburton, although he has been riding these ponies for some time.
PHARMA is not working, even biotech in general, except for Celgene (CELG) and Genentech (DNA) as two names he was ok on. He thinks the day is a wash and this is not a fundamental day, otherwise Texas Instruments would be down.
My take on TXN is the same as his and other "non-bulge bracket firms" that evaluated the news. It might not be fair to say that the street is conflicted in TXN, but the warning was worse than the worse whisper and the guidance for Q1 being even lower signals the real industry trends. We still also have several big chip giants that haven’t yet come clean with any guidance, and that is still a potential headline risk. It is truly illogical about the TXN rise today, although so far it has been marginal. There is another interesting article worth noting, and while I do not really agree with the real extreme timeframe I definitely agree with the basis and the probability that you will see lower prices in TXN from here.
Jon C. Ogg
December 12, 2006
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