On Wednesday night’s MAD MONEY on CNBC, Cramer discussed the sell-off in tech as time to sell,but said you can’t just sell it all. He said it’s time to pull the plugon tech until further notice unless they pass the Cramer test. He saidthe calendar dictates this, and that the best way to trade tech is bythe calendar, which is rarely wrong. This was something I noted earliertoday, where he has changed his stance on tech.
Hesays sell in January and buy in August and hold until Mid-December tomid-January. There are parts that must be given the boot, but he hasfive techs he still blesses. He said unload storage, semis, handhelds,software, and cell phones. There is also more than just the calendar toconsider: The competition is killing them. He said you can’t touchIntel Corp. (INTC) or Advanced Micro Devices (AMD) ahead ofthe Vista launch because of a price war.
He said you have tosell National Semiconductor (NSM), RF Micro Devices (RFMD)and Micron Technology (MU). He said the only way to win in cellphones is by price, but that’s a loser trade so he is negative on NokiaCorp. (NOK), Ericsson (ERIC) and Motorola, Inc. (MOT).SAP (SAP) blew up, Rackable Systems (RACK) blew up; sellEMC Corp. (EMC), Brocade Communication Systems (BRCD).Research-in-Motion (RIMM) is also a sell.
He still owns Marvell Technology Group (MRVL) and MRV Communications (MRVC).
Hewill be addressing five tech stocks he wants to hold for the next fewmonths. Microsoft (MSFT) won’t save the day for thesector, but he likes the company. He said he is exiting when tech is up2.6% more than the market. He says sometimes you don’t have to thinkbeing a lemming is dumb.
There are a few that he thinks canweather the storm. His five names are Cisco Systems (CSCO),Apple Inc. (AAPL), Microsoft (MSFT), Hewlett-Packard (HPQ)and Google Inc. (GOOG).
Cramer said Cisco Systems(CSCO) murdered the Junipers and others. He thinks the recent downgrades justmitigated some of the calendar risk. That was one of his top three growth picks for the year.
Apple (AAPL) is still his No. 2 growth stock of the yearand he is sticking with it. The guidance is just artificially low forthe quarter and he thinks this goes higher even with it down inafter-hours.
Microsoft (MSFT) is too powerful to be capped. The Vistais going to win and MSFT under $28 is a gift (although it is around $31now). He thinks even though it may sell off after the Vista release,you may want to rebuy it.
Hewlett-Packard (HPQ) is the best player in PCs, according to him, that will benefit from Vista.
Google (GOOG)is a product winner and he thinks it goes higher. He said last weekthat it would go to $513 by today, but we are at $497; that’s a giftaccording to him.
He also likes Level 3 Communications (LVLT), but that wasn’t one of his top five holding stocks, he noted. That is his No. 1 speculative play for 2007 from two weeks ago, if you recall.
Jon C. Ogg
January 18, 2007
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