Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Friday October 18.
10 Earnings To Watch In The Week Ahead: VFCorp (VFC), Netflix (NFLX), Dupont (DD), Panera (PNRA), United Technologies (UTX), Caterpillar (CAT), Ford (F), Amazon (AMZN), 3M (MMM), UPS (UPS). Other stocks mentioned: Chipotle (CMG), Google (GOOG), Schlumberger (SLB), General Electric (GE), Capital One (COF), American Express (AXP), IBM (IBM), Honeywell (HON), Boeing (BA), Potbelly (PBPB), Chipotle Mexican Grill (CMG), Noodles (NDLS), Align Technology (ALGN)
The stakes are high this earnings season, since it caps off the year. However, despite the worries from Washington, Cramer thinks the reports this season have been "incredibly bright," especially from Chipotle Mexican Grill (CMG), Schlumberger (SLB), Capital One (COF) and American Express (AXP). With the exception of IBM's (IBM) poor quarter, Cramer said, "This is the best earnings season I've seen in years." There may be a buying opportunity in the coming week if the jobs report on Tuesday is decent, since there will be renewed worries about Fed tapering.
VFCorp (VFC): While the domestic consumer may be spending more money on hard goods than on apparel, the situation in Europe may be different. VFC has significant European exposure, and Cramer wants to hear about what management has to say about strength in Europe.
Netflix (NFLX) may announce a significant uptick in subscribers, and if so, the stock could rise 10%.
Dupont (DD) is reinventing itself as a science company. If management decides to split the company, it might pop 10%. If earnings are merely in-line, the stock could drop.
Panera (PNRA) had its estimates slashed, and there are rumors of a missed quarter and decelerating same store sales. There might be an entry point for the stock, but Cramer wants to hear what management has to say.
Caterpillar (CAT) has attracted a lot of shorts, but demand in construction seems to be increasing, and numbers from China are good. If it raises guidance for 2014, the stock could go past $90. Cramer might consider buying with call options.
Ford (F) has had two good pieces of news: European business is strong and CEO Alan Mulally is staying on. Cramer thinks it could go to $20 next year and wants to buy more shares for his charitable trust.
Amazon (AMZN): "Repeat after me," said Cramer, "I will not trade Amazon until I hear the conference call." This cult stock trades wildly on earnings and headlines.
3M (MMM) is up 32% for the year, and tends to trade down after earnings calls.
UPS (UPS) is worth buying, and has a habit of selling off after conference calls.
Cramer took some calls:
Align Technologies (ALGN) this one has had to face bad quarters and a large amount of short sellers. However, the stock has risen, and it is too high to buy.
AOL (AOL)'s Comeback
One of the greatest internet turnaround stories is AOL (AOL), which is now an internet house of beloved brands after having been left for dead with the demise of the dot.coms. The company is innovating, making brilliant acquisitions like the Huffington Post, and is concentrating on programmatic advertising. AOL has its own network with original programming. The number of advertising clients increased 20% and search ads increased 8%. Unique users and revenue per user are growing. The company is aggressively buying back its own stock and is the comeback story no one is talking about.
CEO Interview: Daniel Starks: St. Jude Medical (STJ)
Medical device stock St.Jude Medical (STJ) is up 56% for the year, but its quarter received a confused reaction after management reported a one cent earnings beat on revenues that were better than expected and inline guidance. The stock opened down, but then rose by the end of the day. Cramer thinks STJ deserved to go higher. The company is taking out costs and therefore, may counteract the challenge of a medical device tax put in place to fund the Affordable Care Act. The company is grabbing market share with its innovative products and technology. CardioMEM is a technology that provides wireless heart monitoring which can cut costs by 28% and reduce hospital stays by 36%. When asked why a life saving device that saves money is being taxed, CEO Daniel Starks replied, "This is horrible public policy." Nanostim is a small, less invasive pacemaker that has been approved in Europe, and is receiving attention from the FDA, although it is not likely to be approved in 2014. Cramer is bullish on STJ.
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