September 29, 2022

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Own cheap stocks on a price-to-earnings basis

Own cheap stocks on a price-to-earnings basis

CNBC’s Jim Cramer Friday previewed next week’s earnings list and advised investors to stick with companies that are profitable but affordable for investors to own.

“In this environment, you need to have companies that make things and do things profitably, but let’s also add, with stocks that stay cheap on a price-to-earnings basis,”mad money‘ said the host.

He later added that even as the Fed tries to bring down high rates, “we’ve already seen signs that inflation has peaked in many areas. Unfortunately, so is the rest of the economy.”

Kramer said he will be watching on Monday Russia’s invasion of Ukraine and its effect on commodity prices. He also said he would monitor 30-year Treasuries.

Thirty years, not twenty[-year], is where all the action will be once the Fed starts selling its portfolio of bonds. “You should know that these massive sell-offs in the 30 years indicate that much higher rates are on the way,” Kramer said. Get ready for her. Higher buying rates are likely to hurt the Nasdaq as we saw today, not the Dow, which could hold up well because it is full of concrete companies that fit my criteria.”

Dow Jones Industrial Average Friday It rose 0.4%. The S&P 500 is down 0.27% while the Nasdaq Composite is down 1.34%. All three declined for this week.

Kramer’s radar also shows a “hot reading” expected in the March CPI, which will be released next Tuesday.

“It will be unforgiving and bad until we see the climax in everything. Whatever the consensus is called, it’s always very low right now, and so it will zap bondholders and put pressure on the stock market that day,” he said.

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Kramer also reviewed next week’s earnings list and provided his thoughts on each reporting company. All profit and revenue estimates are provided by FactSet.

Tuesday: Albertsons, Carmax

Albertson

  • Announcing Q4 2021 earnings before the bell; Conference call at 8:30 a.m. ET
  • Expected EPS: 64 cents
  • Expected revenue: $16.76 billion

Cramer said he expects great results from the Albertsons as he looks for an announcement, whether they’re planning a privacy, big buyback or dividend disclosure.

Carmax

  • Q4 2022 earnings before the bell; Conference call at 9 a.m. ET
  • Expected EPS: $1.27
  • Expected revenue: $7.5 billion

“Any sign that this endless series of price increases has ended, or that demand has been destroyed… would bolster my hypothesis that all used car companies should sell,” Cramer said.

Wednesday: JPMorgan Chase, Bed Bath & Beyond, BlackRock, Delta Air Lines

c. B. Morgan Chase

  • Announcing Q1 2022 earnings at 6:45 a.m. ET; Conference call at 8:30 a.m. ET
  • Expected EPS: $2.72
  • Expected revenue: $30.57 billion

“Every time the Fed raises rates, these people instantly become more profitable on a risk-free basis,” Kramer said.

bed bath behind

  • Statement of earnings for the fourth quarter of 2021; Conference call at 8:15 a.m. ET
  • Expected EPS: 4 cents
  • Expected revenue: $2.08 billion

“The question here is simple: Is big new contributor Ryan Cohen, who… rubbery And Jim Stop Fame, Join the Board of Directors, Will Buy Buy Baby be sold into private equity? “I think everything is on the table and the stock is going up significantly,” Kramer said.

Black stone

  • Announcing Q1 2022 earnings before the bell; Conference call at 8:30 a.m. ET
  • Expected EPS: $8.95
  • Expected revenue: $4.73 billion
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Cramer said he was interested to know how “people can vote on index fund shares.”

Delta Airlines

  • Announcing Q1 2022 earnings before the bell; Conference call at 10 a.m. ET
  • Expected loss: $1.30 loss per share
  • Expected revenue: $8.74 billion

Cramer said he supports travel stocks but thinks airlines are currently facing a tough sell-off “given how much money they could lose in a Fed-imposed recession.”

Thursday: Goldman Sachs

Goldman Sachs

  • First Quarter 2022 earnings announcement at 7:30 a.m. ET; Conference call at 9:30 a.m. ET
  • Expected EPS: $8.95
  • Expected revenue: $11.98 billion

“I’ve never seen Goldman Sachs stock this cheap at all. … I think you get a fairly good chance of a bounce here, if not an investment, because by this point, it should come as no surprise that Goldman’s first quarter has been ugly Kramer said.