Jim Cramer says buy Stanley Black & Decker’s post-earnings plunge ‘aggressively’
Stanley Black & Decker stock plunged Tuesday on the company’s quarterly earnings release — a move Jim Cramer said investors should capitalize on. Shares of the toolmaker shed nearly 12% Tuesday after third-quarter revenues and its implied fourth-quarter guidance came in lighter than Wall Street expected. Still, Jim described the decline as unwarranted. “I would buy the stock,” he said on “Squawk on the Street.” “I would buy the stock aggressively.” That’s because the quarter was not as rough as the market reaction suggests. “This was not a bad quarter,” Jim argued. “In the conference call, [management] says, ‘Look. we don’t have the numbers we’d like.’..That’s because you need to have some pickup or belief that your house is going to gain value before you decide that you’re going to buy the DeWalt, which is the professional, or the Stanley Black & Decker, which is the do-it-yourself.” Plus, the stock still has a key catalyst on the horizon — the U.S. central bank’s loosening monetary policy. As the Federal Reserve continues to lower borrowing costs, activity in the housing market should pickup, boosting demand for Stanley Black & Decker’s tools. The bond market in recent weeks has not cooperated with that thesis , but we’re not throwing in the towel just yet. “If you believe the rate cycle is coming, that’s the stock to buy,” Jim added. “The first trade has not been the right trade.” (Jim Cramer’s Charitable Trust is long SWK. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
