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Bonds Are a 'Safe' Investment: A Big Lie Gets Even Bigger.Tonight on CNBC's MAD MONEY, Jim Cramer tauted Reynolds American (NYSE:RAI) as a high dividend stock with a safe yield that out pays US treasury yields. Even with the 5.5% yield he thinks this dividend is not at risk like some other high yield stocks. He sounded like he even likes it better than Altria (NYSE:MO) as the smokeless tobacco is doing well.
I have noted before about defensive stocks being the way to go and those companies' products are the ones you eat, drink, smoke, and use for critical personal hygiene (toilet paper, tooth paste, deodorant... you get the idea). We noted the sector back on our own list we titled "Defensive Stocks For A Crummy Market" recently, although we had others. Defensive investing is what investors will flock to when they have to own stocks but want to be a bit more conservative than chasing the "New Four Horsemen of Tech" or want to go for less aggressive picks than say his TOP NINE STOCKS for 2007.
Jon Ogg is a partner at 24/7 Wall St. and publisher of Special Situation Investing Newsletter. He does not own securities in the companies he covers.
Cramer gets defensive with Reynolds American (RAI), Altria (MO)
Posted Aug 16th 2007 8:20PM by Jon Ogg
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Reader Comments (Page 1 of 1)
8-17-2007 @ 2:35AM
Michael Schneider said...
RJ Reynolds also recently won a lawsuit against a small competitor. The growth of smokeless tobacco and the potential for the new snus (see synopsis of recent USA Today feature on snus in the Trends section- left side, halfway down page- at http://www.Barrelomoney.com. Readers will also find RJ Reynolds and UST early up on our list of Barrel View stocks which were discussed in our free weekly Barrel View e-mailing for those who sign up the Barrelomoney Private Guestbook.
Jim Cramer has recommended 60 food and restaurant and tobacco stocks in his Lightning Rounds since their start several years ago- a full list is available free for those interested at http://www.Barrelomoney.com. He was a latecomer to RJR though- having 1st avoided the company as inferior and not "best of breed" (the list is in order and you can see RJ Reynolds comes in only recently) in favor of Phillip Morris (the Trends item above was not very favorable toward MO's new snus product).
8-17-2007 @ 2:38AM
Michael Schneider said...
Correction to above item:
The list of Jim Cramer's food, restaurant and tobacco stock recommendations from his Lightning Rounds is available at http://www.Barreloworld.com not at Barrelomoney.