CROs Your Play On Outsourcing
Posted on January 14, 2008 at 18:56 PM EST
Politicians rally against it to get votes but for companies it is about cutting costs, to Cramer outsourcing is a way to make investors money. In this market it is no easy task even with International Business Machines Corp. ( IBM ) boosting the market 172 points today. To him this is just a break in the clouds with the storm continuing. Recommending was to buy the defensive stocks that traders abandoned today. It is a chance to get them on sale before they start to climb again. It wasn't just the typical supermarket and drugstore companies. He looked at some lesser known plays he called "contract research organizations ( CRO )." CROs help develop drugs and run clinical trials for big pharma and biotech companies. Cramer sees outsourcing as a way that the Pfizers Inc. ( PFE ) of the world can save money, and this makes CROs a viable business , as they have a 25% market share today and should grow to 40% over teh next couple years. In this sector the best company is Covance Inc. ( CVD ) as it has an "immaculate balance sheet." Over the last year shares have gone up 52% but should move higher. Cramer is also a fan of PAREXEL International Corporation ( PRXL ) and Charles River Laboratories ( CRL ) even though CVD is is favorite. CRO VIDEO PERSCRIPTION VIDEO
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