There's a difference in being a ranked amateur and a rank amateur and too many people want to be rank and too few ranked.
That's what I think about when I see this list of "popular retail trading stocks" that David Kostin put together in his recent Goldman Sachs (GS) strategy report. I mentioned them to you last night but now I want to give you a little analysis, which is a lot more analysis than you might have done if you own most of these stocks.
First off is Penn National (PENN) and that's all on Dave Portnoy, the colorful personality who is now heading up his own bucket shop, Davey Day Trade Global. He's a big shareholder and Barstool is part of the Penn National family. I have liked this casino company very much because it competes with no one in most of its markets and one day we will have pro sports and pro sports gambling, and Dave Portnoy and Penn Nat CEO Jay Snowden will make beautiful music together. I am giving it three Cramer stars. It would have had a fourth but it has moved too much. Still three out of five ain't bad.
Second is Moderna (MRNA) , which is the highest risk of the vaccine trailers. I think that Regeneron (REGN) , Merck (MRK) , Pfizer (PFE) , Glaxo (GSK) , and Astra Zeneca (AZN) are all tightly clustered with Moderna, the difference being that if Moderna fails you are going to lose a fortune but if the others fail it will be c'est la vie. I hated the way Moderna talked positively about its chances and then dumped a huge amount of stock. One star on the Cramer constellation index.
Tesla's (TSLA) a tech company that makes cars that are in such high demand that I have fallen in line with it for about 600 points, too late for some cranks, but not bad for TV work. Four stars. Five if it would ever come down cause Musk is a genius.
Royal Caribbean (RCL) is a good company in an industry that simply really doesn't matter anymore even as there are lots of trips being booked because without a vaccine I think a lot of those trips will be cancelled. The better operator on a host of measures is Norwegian (NCLH) and, for once, a lower dollar amount stock is better than a higher one. I like management here but I can only give it one and a half stars given the field of stocks that are out there to buy.
Snap's (SNAP) a big comeback story and it is one that I think will have some runway because there aren't a lot of them. It beat the numbers but it's still losing gobs of money. Facebook (FB) , yes Facebook, even up here, is the better buy. So is Alphabet (GOOGL) . Two stars.
MGM Resorts (MGM) is well-run but it has China exposure which I find hard to get my arms around and you don't need to own two casino stocks. Two stars.
Spirit Airlines (SAVE) is a loser. Has been a loser for ages. You buy Southwest (LUV) , best run, or United (UAL) on any equity offering. Half star.
Norwegian gets two stars. That's all you can get when you are the best start in a real bad neighborhood for stars. It really is like that and I think the neophyte traders just don't understand that concept. They've been led into the cruise lines and that's a very tough business pre corona virus.
GoPro (GPRO) is a gizmo stock and the only reason why people are buying it is because it's a low dollar stock. Enough already. You want a device? Buy an Alexa (Amazon: (AMZN) ). One star for a stock that's past its sell date.
Finally Marathon (MRO) at six dollars. Ask yourself, owners/traders, would you own this stock if it were at $60? In other words if it shrunk the share count in a ten for one reverse split? Don't bother to answer. I know the answer is no. This is a one star. However, I have a three star for an industry I truly dislike and that's Parsley (PE) . I recommended this $11 stock two weeks ago when it was $8 and I will recommend it again as it is the only oil company with great growth, great balance sheet, great properties and a much greater respect for the planet than all of the other oils. Make the switch. Now.
I know that these are not high marks. But I want you to think, first, do I know what this company does, and second, does it do it well, and third, is there anything going on that could change the trajectory. If you say three nos, then you are a no star player.
(Goldman Sachs, Facebook, Alphabet, and Amazon are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells these stocks? Learn more now.)
