Cramer's 2 Toxic High Multiple Stocks

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From 5-14-07:

Slowing growth and a high multiple: a toxic combination. Yet people believe that it's OK if the slowing growth is affecting Starbucks (SBUX) and Whole Foods (WFMI). That's my takeaway, because these two stocks are still way too high vs. the slowing fundamentals, at 33 times and 29 times earnings, respectively.

Both companies have growth in the mid-single digits. Both are saying that the decline in growth has bottomed. Away from these companies, though, you can get much better growth from McDonald's (MCD) -- consistent, better growth, for much less.

You want big growth? Consider Yum! Brands (YUM), which is really putting the numbers on the board and makes Starbucks and Whole Foods look like they're mailing it in.

Cramer is not a fan of SBUX or WFMI.

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