Will Cramer's Mad Money Mojo Lift Level 3?
January 8th, 2007 By: Rich Miller
My wife refers to Jim Cramer as “that guy who’s always yelling about the stock market.” These days Cramer is yelling about Level 3 Communications, which he began recommending to his legions of “Mad Money” viewers back in September. Despite the huge run-up in data center and network services stocks in 2006, Cramer is convinced Level 3 has a long way to go and on Friday made it his top speculative stock pick for 2007. A summary from Seeking Alpha:
Level 3 Communications is Cramer’s top speculative pick for 2007 because he believes it will benefit from the bandwidth shortage. Although the stock is up 35% since Cramer’s initial recommendation in September, he sees potential for a more dramatic jump because of its deal with YouTube and NBC. In addition, LVLT’s deal with Broadwing was completed on Thursday, and the stock has a “big risk, big reward.” Although the company also has $6.8 million debt and investors may lose money on the stock, Cramer comments “if you’re gonna stay interested in stocks, you gotta take a few risks, and one of those risks is taking LVLT, even at its $6 level.”
Some people love Cramer, others don’t. But plenty of investors pay attention to him, and that’s likely to benefit Level 3, which since Friday has gained 49 cents to close at $6.08 a share, an improvement of 8.7 percent in two trading sessions.