Filed under: Deals, Market matters, Wrigley, (Wm) Jr (WWY), Dow Chemical (DOW), Cramer on BloggingStocks
TheStreet.com’s Jim Cramer says its stunning buy of Rohm & Haas will get people thinking about an energy top.
Just when you thought it was safe to short anything, particularly anything with any commodity exposure, Dow Chemical (NYSE: DOW) (Cramer’s Take) comes along and inexplicably pays a gigantic amount of money, $78 in cash, for Rohm & Haas (NYSE: ROH) (Cramer’s Take)? My first thought was that it must be a joke. That’s inconceivable. A hoax. Something perpetrated by frustrated longs to spook the shorts.
I mean, a chemical company? Two chemical companies? Ground Zero for slowing economic activity and raw costs? People unsure if Dow could even pay its almost 5% yield? I mean, even last night on my show, I made fun of the idea that people are confusing Becton Dickenson (NYSE: BDX) (Cramer’s Take), a medical supply company, with a chemical company because it uses resin.
Breathtaking.
So now, the whole market re-evaluates for a second and wonders whether Dow thinks oil’s gone up enough or sees an economic recovery, or whether stocks are just too darned low and they wanted to take advantage of the declines, which they regard as cyclical and nearly over. I say that because ROH’s lineup is deeply cyclical and is therefore considered deeply history.
Stunning.
Will it matter? Maybe. But remember Mars and Buffett bought Wrigley (NYSE: WWY) (Cramer’s Take), and for a couple of days we’d chatter that stocks were too cheap, and where did it get us?
In Mars’ defense, that deal marked a near bottom in the defensive stocks. Have you seen where they are?
Maybe this deal will mark a top in energy? That’s what Dow needs. Stranger things have happened.
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RELATED LINKS:
Three Stocks With Good Chemistry
Cramer’s ‘Mad Money’ Recap: Get Healthy With Becton Dickinson
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Jim Cramer is a director and co-founder 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 had no positions in the stocks mentioned.
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