Earnings season is entering full swing on Wall Street, and CNBC’s Jim Cramer said Monday that investors would be wise to take a wait-and-see approach toward shares of companies that are about to report quarterly numbers.
“In this environment, it’s always going to be fragile on the upside and easy on the downside, because the bears … have the upper hand. Just keep in mind you should never buy this market when it’s up. That’s a fool’s game. I want you to wait for weakness like we had [Monday] before you ever pull the trigger,” the “Mad Money” host said from the floor of the New York Stock Exchange, the show’s new broadcast home.
“If you’re thinking about buying something that’s about to report, why not wait until you hear what they have to say?” Cramer continued. He pointed to IBM as a prime example.
As of Monday’s close, IBM was one of only seven stocks in the 30-stock Dow Jones Industrial Average to be higher year to date. However, shares were down nearly 4% in extended trading Monday after the company reduced its 2022 cash forecast, even though its second-quarter results beat on the top and bottom lines.
“If you bought it ahead of the quarter, you rolled the dice in a casino that’s not friendly to blind dice-rolling,” Cramer said.
With that in mind, Cramer previewed a number of other major earnings reports that are scheduled for the rest of this week. All earnings and revenue estimates are provided by FactSet.
Tuesday: J&J, Halliburton, Lockheed Martin and Netflix
- Q2 earnings release 6:45 a.m. ET; conference call at 8:30 a.m. ET
- Projected EPS: $2.54
- Projected sales: $23.77 billion
Cramer, whose Charitable Trust owns shares of J&J, said he’s expecting to see good numbers from the pharmaceutical giant even as the company works to separate into two distinct entities. He noted J&J’s shares have lagged behind peers this year, including Bristol-Myers Squibb and Merck.
- Q2 earnings release before the bell; conference call at 9 a.m. ET
- Projected EPS: 45 cents
- Projected revenue: $4.7 billion
“Halliburton’s earnings are soaring, yet its stock has been crushed. … I think it’s time to reassess this one, and recognize that the earnings could be huge for Halliburton not tomorrow, but for years to come,” Cramer said.
- Q2 earnings release before the open; conference call at 11 a.m. ET
- Projected EPS: $1.88
- Projected sales: $15.98 billion
- Q2 earnings release after the close; conference call at 6 p.m. ET
- Projected EPS: $2.95
- Projected revenue: $8.03 billion
Cramer said he’s hoping to hear a more “thoughtful” earnings call from management after this quarterly print compared with the streaming giant’s poor first-quarter report. In particular, Cramer said investors want more information on Netflix’s recent deal with Microsoft, which is part of Netflix’s development of an ad-supported subscription tier.
Wednesday: Abbott Labs and Tesla
- Q2 earnings release before the open; conference call at 9 a.m. ET
- Projected EPS: $1.12
- Projected sales: $10.29 billion
- Q2 earnings after the bell; conference call at 5:30 p.m. ET
- Projected EPS: $1.81
- Projected revenue: $16.52 billion
Cramer said he believes Tesla’s earnings report is the most important this week. “The estimates are all over the place. There are a huge number of sell ratings and as many buys. [CEO Elon] Musk is still expanding like mad. … Still, if Tesla can exceed even the lowest estimates, the stock goes much higher.”
Thursday: AT&T, Freeport-McMoRan, Dow Inc., Union Pacific, D.R. Horton, Snap, Mattel and Boston Beer
- Q2 earnings release before the bell; conference call at 8:30 a.m. ET
- Projected EPS: 61 cents
- Projected revenue: $29.53 billion
- Q2 earnings release before the open; conference call at 10 a.m. ET
- Projected EPS: 64 cents
- Projected sales: $6.14 billion
- Q2 earnings release at 6 a.m. ET; conference call at 8 a.m. ET
- Projected EPS: $2.14
- Projected sales: $15.55 billion
Cramer said chemical firm Dow Inc., along with copper miner Freeport-McMoRan, should offer insights into the trajectory of economic growth.
- Q2 earnings release at 7:45 a.m. ET; conference call at 8:45 a.m. ET
- Projected EPS: $2.85
- Projected revenue: $6.13 billion
Cramer said he’s worried railroad operator Union Pacific could warn of a deceleration in its business.
- Q3 earnings release at 6:30 a.m. ET; conference call at 8:30 a.m. ET
- Projected EPS: $4.49
- Projected sales: $8.81 billion
Just like with Union Pacific, Cramer said he’s worried the homebuilder D.R. Horton may warn of a slowdown in cancellations. “Home deals aren’t closing; home confidence [is] down huge. Soaring mortgage rates tend to do that,” he said.
- Q2 earnings after the bell; conference call at 5 p.m. ET
- Projected EPS: loss of 20 cents
- Projected revenue: $1.14 billion
- Q2 earnings release after the close; conference call at 5 p.m. ET
- Projected EPS: 6 cents
- Projected sales: $1.1 billion
- Q2 earnings release after the bell; conference call at 5 p.m. ET
- Projected EPS: $4.61
- Projected revenue: $612 million
The parent of Sam Adams and Truly has struggled lately thanks to a slowdown in hard seltzer sales, and Cramer said he’s expecting more of the same with this print. He said he prefers shares of Corona parent Constellation Brands, which his Charitable Trust owns, to Boston Beer.
Friday: American Express, Verizon, Schlumberger and Twitter
- Q2 earnings release at 7 a.m. ET; conference call at 8:30 a.m. ET
- Projected EPS: $2.42
- Projected sales: $12.51 billion
Cramer said he expects spending from small businesses and consumers to help American Express report solid results.
- Q2 earnings release 7:30 a.m. ET; conference call at 8:30 a.m. ET
- Projected EPS: $1.22
- Projected revenue: $33.73 billion
- Q2 earnings release 7 a.m. ET; conference call 9:30 a.m. ET
- Projected EPS: 40 cents
- Projected sales: $6.28 billion
Cramer said he expects a good number from oilfield services provider Schlumberger, just like he does with Halliburton.
- Q2 earnings release at 8 a.m. ET; no conference call scheduled
- Projected EPS: 15 cents
- Projected revenue: $1.33 billion
Twitter is not holding a conference call to discuss its second-quarter numbers, citing its “pending acquisition” by an entity affiliated with Elon Musk. The two parties are currently engaged in a legal back-and-forth related to the deal.
Disclosure: Cramer’s Charitable Trust owns shares of HAL, JNJ, MSFT and STZ.
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