Higher volatility could turn positive for stocks

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UnitedHealth and Johnson & Johnson: Both holdings in Cramer’s charitable trust, health care giants UnitedHealth and Johnson & Johnson will report earnings Tuesday morning.

“UnitedHealth is the best-run health insurer in America. I bet they can raise numbers,” Cramer said. “As for JNJ, it’s been trading like it’s got earnings risk, but they’ve got the best pipeline in the business and that’s what matters most. I hope it pulls back and you can get a chance to buy into further weakness.”

Goldman Sachs and Morgan Stanley: Neither one of these investment banks is “getting anywhere near the respect” it deserves, Cramer said ahead of their earnings reports. He expected good results from both, but admitted he’s miscalculated investment bank earnings in the past.

“I honestly can’t believe that Goldman Sachs, my alma mater, is the cheapest in the entire group. I do hope that David Solomon, the new CEO, … sketches out a vision for how to restore growth, and that Stephen Scherr, the new CFO, is polished enough to paint a positive picture of falling expenses and rising revenue,” Cramer said. “This stock has sold off in the wake of its conference call for ages. Maybe the new team can break that pattern.”

IBM: With shares of IBM hovering around their 52-week lows, Cramer hoped that even a modest quarterly report would help the stock recover.

“To me, IBM doesn’t seem to have much downside. It does sport a 4.5 percent yield here,” he said. “I just don’t know if the company’s gradual embrace of faster-growing, strategic-imperative businesses will produce blowout numbers, which is what this stock really needs. But this low, … I think it’s probably going to be OK no matter what.”

Netflix: Streaming colossus Netflix will also issue its quarterly report, the first since the company’s slowing subscriber growth disappointed investors in June.

“Unless those numbers pick up from the last quarter, this stock’s not going anywhere,” Cramer warned. “That said, Netflix is down more than $80 bucks from its highs, and it was down $100 yesterday. Long-term, this might be a good buying opportunity.”

2018-10-12 22:11:00

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