I've got a red-hot icebreaker for you. The next time you find yourself in a dwindling social situation, where it seems as if the conversation is running on fumes, just fling the following question into the mix:
"What do you think about Jim Cramer?"
Some people love Cramer. Some people hate him. Either way, everybody has an opinion on financial journalism's reigning rock star.
I'll confess to being entertained -- and on occasion enlightened -- by the Mad Money star. However, there is nothing I hate more than when Cramer opens up the phones to kick off the Mad Money Lightning Round.
In rat-a-tat-tat fashion, callers will swap boo-yahs and holler a ticker symbol Cramer's way. They'll get a snappy line or two in response, occasionally with a silly sound effect as an exclamation point.
That may be entertaining to watch, but it's the equivalent of nails against a chalkboard to me as an investor. After all, we're all looking for stock ideas. It's just not right to boil down due diligence to the ring of a cash register or the snort of a charging bull.
Every lightning round, I make the same three-word plea, which Cramer never heeds: "Tell me more!"
Walk a short mile in Cramer's long shoes
Let's play a game. I'll pretend to host Cramer's lightning round. You'll throw out the names of some of my favorite stocks. Ready? Go.
-
Volcano
(Nasdaq: VOLC) : The leader in intravascular ultrasound gear is about to erupt, baby. -
NetEase.com
(Nasdaq: NTES) : Online gaming is booming in China. Talk about living up to your name! -
Buckle
(NYSE: BKE) : Buckle up, amigos! The rest of the mall is empty, because everybody's shopping here. -
NVIDIA
(Nasdaq: NVDA) : Graphics processors? I like what I see here, people. -
Research In Motion
(Nasdaq: RIMM) : Research In Motion? They should be calling this smartphone maker Poetry In Motion.
Next caller?
Did any of that work for you? I hope not. It may be a worthwhile exercise to boil down a stock's buy thesis to a Cramer sound bite or a cocktail-napkin scribble, but you really need to know more than what five seconds from a talking head will tell you.
Volcano is more than just the top dog in its niche, which combines angioplasty catheters with ultrasound imagery. The company had to knock off Boston Scientific
NetEase is growing quickly, thanks to the most popular multiplayer Web-based game in China. Despite its huge margins and bottom-line gains, it's trading for only 14 times 2010's projected earnings.
Buckle is truly a mall magnet. Sales in its latest fiscal year climbed 13% with earnings growing even faster. Unlike GameStop
NVIDIA had its bumps and bruises during the recessionary slowdown, but it has posted better-than-expected profitability in each of the past four quarters. Analysts see profits more than doubling this year.
BlackBerry maker Research In Motion continues to sell millions of handsets every quarter, with each smartphone typically tethered to a two-year service contract. The iPhone may be getting all the buzz, but BlackBerry remains the corporate world's smartphone of choice.
You have to be hungry for more
Fleshing out snappy sound bites to a few sentences -- as I just did -- is better, but it's still not enough.
As a member of the Motley Fool Rule Breakers analyst team, I don't settle for bullet points. When we recommended Volcano and NetEase.com to subscribers of the growth-stock newsletter service, our advice came in the form of a thorough buy report, complete with financial data and dozens of exploratory observations.
Due diligence doesn't end there, of course. A vibrant community of analysts and subscribers continue to discuss the recommendations, with updates as the fundamentals change for the better or worse.
Does Mad Money do that? Of course not. It may be weeks, months, or even years before a stock is revisited during the show's lightning round. And, as you can expect, you'll still be left hanging with those same three words: Tell me more.
Whether or not you join me and my fellow analysts for a free trial in time for the next batch of monthly recommendations, never settle for less information than you deserve when the time comes to plunk down your hard-earned money on a stock. You deserve better than that.
This article was first published May 28, 2009. It has been updated.
Longtime Fool contributor Rick Munarriz realizes that wedding vows may take all of two words, but stock relationships need more. He does not own shares in any of the stocks in this story. Volcano and NetEase.com are Motley Fool Rule Breakers recommendations. NVIDIA is a Motley Fool Stock Advisor selection. Motley Fool Options has recommended writing covered calls on GameStop. The Fool has a disclosure policy.
