Health care's not done rallying. As President Obama prepared himself for claiming a great political victory, we are all recognizing that the single-payer, socialized medicine covering cradle-to-grave, 100% paid for by the rich, the fear that left all things health care in the P/E dustbin, is dead. That's not going to happen.
That leaves us with the biggest bargains the market has to offer.
Health care has never been this lowly valued relative to the market in its history. Remember, 98% of the time it trades at a meaningful premium. I think that many believe some of these moves (like the Celgene (NASDAQ: CELG) (Cramer's Take) move) is because of gigantic new drug finds. In fact, I think they just got too cheap and the only thing really meaningful about the Celgene rally came because one of its Revlimid studies was stopped for good results, actually a predictable event given how well the drug works on many different kinds of cancers.
Same with Merck (NYSE: MRK) (Cramer's Take) and Pfizer (NYSE: PFE) (Cramer's Take). There was nothing really exciting about these two other than that they will be taking costs out because of mergers. Bristol Myers (NYSE: BMY) (Cramer's Take) jumped because it woke up from it slumber to buy growth, something that Johnson & Johnson's (NYSE: JNJ) (Cramer's Take) been doing all year, which is why that stock is back to $60.
This group's going to keep doing this, going to keep making these under-the-radar moves that will, in the end -- when Obama says, "Wow, we have saved the American people trillions of dollars" -- make your portfolio the only real winner in this Washington-based fiasco.
I think the diagnostics (Inverness Medical (NYSE: IMA) (Cramer's Take) is my fave), the drugs (Bristol Myers on newfound growth and Abbott (NYSE: ABT) (Cramer's Take) because it is cheap), WellPoint (NYSE: WLP) (Cramer's Take) as an almost totally non-Medicare Advantage player, Medco (NYSE: MHS) (Cramer's Take) and Express Scripts (NYSE: ESRX) (Cramer's Take), all seem poised to go higher.
I would only worry about home health care and oxygen plays -- they always seem to get hammered by the government and this time I don't think it will be any different.
Random musings: Bizarre article about me in the New York Post this weekend. I am not sure that the fact that I am a bit cuckoo and threw some computers and chairs in my youth is all that newsworthy, as anyone who watches "Mad Money" or reads "Confessions of a Street Addict," in which it is a constant theme, will attest to.
My old friend Todd Harrison, who worked with me briefly in 2000 -- just long enough to get a book out of it -- seems to think that I was ousted after a bad year. In fact, I was up 36% that year -- I am actually good at this stuff -- while the market was down, and I had more people wanting to give me money than ever. I just wanted to quit on top and I gave away the firm to my non-equity partner, Jeff Berkowitz, not to Todd. Hard to oust the guy who owns 100% and runs the place.
Todd's description of me, at least according to the article, reads far too much like the description I gave of myself in "Confessions" except mine's more vivid with a lot more anger. No wonder I quit.
Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Bristol-Myers, Inverness Medical and Abbott.
Closing Bell: Economic Catapult for Thanksgiving & Black Friday (WMT, TGT, GRMN, GOOG, MSFT)
Deere up on Q4 earnings performance
Reid Hoffman: LinkedIn will go public (at some point)
Reader Comments (Page 1 of 1)
7-28-2009 @ 12:32PM
ObamaMama said...
BooYa Professor Skee Daddy! Great Show - Never Miss...
Regarding Health Care:
I think Folks get health care when needed in the US Regardless if they have Insurance or not, so there will not be any major increase in demand or waiting times for care. We would just empty all the Deadbeats giving false names out of our Hospital Emergency Rooms. Most of which use names of friends with medical cards so they at least get free Medications at the Pharmacies that never ask for ID's anyway. The biggest Drug Trafficers in the world from Juan the imigrant to Rush the Ignorant.
All that said, I have heard of several folks going to other countries from the US for at least Medications after seeing a US Doctor. So, I'm saying Care Quality or Doctor - Patient Times wouldn't seem to be impacted by Universal Care, but the Price Structure, with the huge double standard between what Physicians charge cash customers and the highly discounted price for same service to Insurance Providers, Self Insured Companies and possibly some folks wealthy enough to staff legal representitives to negotiate special prices through compacts or cooperatives. (This is even how whole States do it and then get the medications from Canada on top of it, oddly enough sending Medicare - Medicaid Money into an already unbalanced trade exporting market. That's odd!
It's that double standard cost that multiplies the impact towards the poor and middle income while the Medical Business Community does out source much work like in Texas to Mexico and Illinois on up to Canada. If the US Federal Government stepped in I could at least make the arguement that they would not export work or import medication, it would incourage more of a flat fee system allowing uninsured clients back into the market and lower health care expenses even on small business.
Even the Doctors get helped by reduced paperwork, a simpler fee system for a higher rate of collections and nothing indicates a loss of income or surge in demand for care.
WIN WIN
Lonnie McVaigh, Pensacola Florida CRAmerica!