Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Friday November 1.
11 Earnings To Watch: Anadarko Petroleum (NYSE:APC), Carrizo Oil & Gas (NASDAQ:CRZO), Pioneer Natural Resources (NYSE:PXD), Tesla (NASDAQ:TSLA), Regeneron (NASDAQ:REGN), AOL (NYSE:AOL), CVS Caremark (NYSE:CVS), Whole Foods (NASDAQ:WFM), Cimarex (NYSE:XEC), SolarCity (NASDAQ:SCTY), Disney (NYSE:DIS). Other stocks mentioned: Facebook (NASDAQ:FB), Trimble (NASDAQ:TRMB), Barrick Gold (NYSE:ABX), SPDR Gold Trust ETF (NYSEARCA:GLD), Twitter (NYSE:TWTR)
It is a good sign that the S&P 500 has been rallying most of the year. Cramer noted that this usually indicates that stocks will keep rising until the year's end, and he expects this trend to play out at least until January. Two news items that will affect stocks this week are the pricing of the Twitter (TWTR) IPO and the employment report on Friday. While Facebook (FB) is now a great stock, its IPO was a disaster, and Cramer is worried that Twitter may be priced too high, as FB was. Many are saying that Twitter should be valued at $15 billion, while Cramer would be willing to see a valuation up to $20 billion. Cramer would look at the market cap rather than the price per share, because it depends on how many shares are issued.
The only way the employment number will not bring stocks down is if it is a "Goldilocks" number: not too hot, not too cold. If the number is weak, people will sell on economic worries, and if it is strong, there will be worries about Fed tapering.
Cramer discussed important earnings in the week ahead:
Anadarko (APC), Carrizo Oil & Gas (CRZO), Pioneer Natural Resources (PXD) are all three reporting on Monday. The companies have been raising production, but with oil prices falling, they might get hit no matter what they say. If oil rallies on Monday, Cramer would buy any of them going into earnings.
Tesla (TSLA) is a cult stock which might go higher if management talks about a deal in Europe or China.
Regeneron (REGN) has been hurt by chatter concerning competition and is in a tough space. Cramer would stay on the sidelines.
AOL (AOL) is often greeted with catcalls, but when the stock drops, it has usually been a buy. "2014 will be a good year for AOL."
CVS Caremark (CVS) has been on fire, along with other drugstores. Cramer would buy it lower.
Whole Foods (WFM) is likely to be besieged by nitpicking analysts. WFM has been a consistent buy on weakness.
Cimarex (XEC) is increasing its oil production dramatically. Cramer would buy it ahead of earnings if oils on Monday take off.
Solar City (SCTY): Like most cult stocks, is likely to go higher until it implodes, and it doesn't look ready to implode yet. If Tesla rallies, SCTY is a buy, since they tend to trade together.
Disney (DIS) dropped after its last earnings, and then rallied 10%. Cramer would pick some up if it falls after it reports.
Cramer took some calls:
Trimble (TRMB) is too high; "Take a pass."
Better Late Than Never: Swift Energy (NYSE:SFY)
On the domestic oil boom, Cramer would consider buying a shares of a $560 million exploration and production company that has been left behind. Swift Energy (SFY) trades at just $12 and is in the early innings of the transition from natural gas to oil. "Better late than never," said Cramer, who believes SFY will see more upside as it reduces its 48% exposure to natural gas and becomes more "oily." SFY has seen success in the Eagle Ford, and has found oil in 100% of its wells there. It is cutting production costs and increasing production. SFY recently reported a 3 cent earnings beat with an 18.8% rise in revenues. Cramer would be a buyer before SFY's transformation is complete.
Delta (NYSE:DAL) Is Good Either Way. Other stocks mentioned: USAirways (LCC), Student Transportation (NASDAQ:STB), Hertz (NYSE:HTZ)
After decades of refusing to recommend airlines, Cramer changed his position 7 months ago because the industry is consolidating and price wars may be a thing of the past. USAirways (LCC) announced it would merge with American Airlines, and while the Justice Department is holding up the deal, Cramer thinks Delta (DAL) will be a winner, no matter what is decided about the deal. DAL has seen the largest gain in the industry since Cramer got behind the airlines, 70%, while the others have increased well into the double digits. DAL has increased its number of passengers, selling more premium seats and cutting costs. It reduced its debt from $17 billion to $9.9 billion and plans to continue to clean up the balance sheet. DAL reported a 5 cent earnings beat on rising revenues and improved operating margins. If the USAirways/American merger goes through, that will mean less competition, and will be good for all players in the industry. If the Justice Department strikes the merger down, DAL will continue to outperform USAirways.
Cramer took some calls:
Student Transportation (STB) has a yield that raises eyebrows, but it is probably safe.
Hertz (HTZ) reported a bad quarter, but it may be a long-term buy. It was likely hurt by the government shutdown.
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