Stock Smackdown: Cramer vs. CAPS

Cramming for Cramer

The Fool's free investing community, Motley Fool CAPS,
aggregates the opinions of more than 135,000 members to assign ratings
for each stock's likelihood of outperforming or underperforming the
market.

Below, we look at some top stocks that Cramer picked and panned
during last week's "lightning rounds," and we compare them with how the
CAPS community sees their future.

Cramer says …

It's not enough that Regions Financial has been nearly run into the ground, had to seek out $3.5 billion in TARP money last fall, and then had to raise another
$2.5 billion after it failed the U.S. government's "stress test." Just
after it secured the government's cash in November, its CEO also had
the audacity to fly off with his family to the tony Greenbrier resort
for a little R&R, at a cost to the bank of more than $17,000,
according to The Wall Street Journal.

While the expense is not enormous relative to the size of the business, let's remember the lambasting that the auto executives received for a similar lack of discretion. It's with good reason that the corporate jet may be one of the most irksome pictures of executive excess -- even if there are good arguments in favor of their use. In any event, Jim Cramer has little use for Regions these days:

Oh, come on, man ... you're in a sea of winners, and
you come to me with that two-bit, nonsense name! Sell, sell, sell. ...
You should be ashamed of yourself! ... Why aren't you in Huntington Bancshares? ... Huntington Bancshares is a lot better!

CAPS says …

Such lapses in judgment notwithstanding, the CAPS community is divided over the caliber of management's quality. For example, bankerman13 finds Regions to be of a higher quality than other similarly situated companies:

regional bank with potential for great income based
on franchise. Loan writeoffs are done with. Management is superior to
other regional southeast franchises. Stock will be at [a price-to-sales
ratio of] 15 in one year and then nice dividend will come back. [TARP]
money will be paid back. You can count on it.

Yet even with nearly three-quarters of CAPS members thinking Regions Financial will outperform the market, Spencersb
says Regions will continued to be dogged by the fiasco caused by its
peddling of high-yield mutual funds. It's alleged that Regions' Morgan
Keegan unit (RMK) marketed the funds as safe, low-risk investments when
they were, in fact, loaded with risky, toxic assets: "Until management
changes and the full impact of the RMK Funds debacle is known, this
regional money supermarket will at best bump along near current levels."

Regions has subsequently lost numerous arbitration cases. Hundreds
of arbitrations have yet to take place, and the cases that have already
taken place have cost it millions.

Financial stocks aren't held in high esteem among CAPS members these days: The 425 stocks with the CAPS Commercial Banks
tag garner a lowly two-star rating as a whole. Over the past month,
they've lost on average about 4%, though that's still better than the
8.5% decline that Regions has suffered.

Your say

While CAPS members may stand
with Jim Cramer or on opposite sides of the field, the
investor-intelligence community is more than what some All-Stars think,
even if they are TV personalities. But what do you think? Is Cramer
right, or is he off his rocker? No need to hedge your thoughts on CAPS,
so why not head off right now to CAPS, where you can sound off on
whether Regions Financial is a stock you can still take to the bank?

Motley Fool CAPS
is a great place to start your own research on these stocks. Read a
company's financial reports, scrutinize key data and charts, and
examine the comments your fellow investors have made -- all from a
stock's CAPS page. Best of all, CAPS is free.

© 2009 UCLICK L.L.C.