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Today, Cramer’s talking about the Russell rebalance. It’s that time of year when the Russell Indexes drop the stocks that don’t fit the mold and then re-up with new names. The strategy here is to find good companies with the best chance of making the cut because the analyst coverage alone can sometime boost a stock’s value.
Cramer has three picks he likes specifically because the coverage is so thin, and that is most likely what would fuel the upside. A quick note to keep in mind, though: These are all volatile small-cap names, stocks that Cramer would normally hold for speculation Friday. So it’s probably not a good idea to buy up shares in after-hours trading. Wait a couple of days, Cramer says, then buy in increments and with limit orders.
The first pick is Coleman Cable, an electric wire and cable company with a good business. It just acquired Copperfield LLC, which doubled its size, diversified its product lineup and helped to cut costs. The company’s a market leader, Cramer says, and only one analyst has an eye on it. Not to mention, Coleman could be a target for the likes of General Cable or Belden, too.
Second is FC Stone. This is a commodities risk management firm that came public in March. Only two analysts cover FCSX, and Cramer sees big growth in overseas business in places like China and Brazil.
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