This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Cramer's 'Mad Money' Recap: Making Sense of Earnings Season

For still other companies, like those in the oil and gas sector, determining gross margins may be almost impossible. For these giants there are multiple costs for drilling and getting the oil out of the ground, transporting and storing it, and refining it into finished products.

That's why so many big oil firms are breaking themselves up into separate companies with single functions. It's simply easier for Wall Street to determine what they do and how much money they'll be able to make, he said.

When it comes to gross margins, Cramer concluded, Wall Street wants consistency. Changes in gross margins often lead to changes in stock price.

Listen to Management

Cramer's next thing to look for on conference calls and earnings reports is a signal about the future, dividend boosts or catalysts to boost sales.

Far too often companies are enamored of stock buyback programs as a way to return value to shareholders, but far too often buybacks do nothing to raise share prices and only work to help management beat estimates. That's why Cramer said he vastly prefers dividends as a way to reward a company's shareholders.

With interest rates at historic lows for the foreseeable future, Cramer said dividends have taken on increased importance. That's why nearly 40% of the total return of the S&P 500 over the past 10 years has been dividends, and why Cramer has preached almost nightly on how reinvesting dividends can significantly boost a portfolio.

Cramer said he's always listening for management to talk about their dividends and the possibility of raising them in the future. In addition, he's also listening for what he calls catalysts, something that could boost a company's share price in the short term.

Catalysts come in all forms. For pharmaceutical companies, catalysts may be a drug that's entering Stage III testing or expanded uses for existing drugs they're already producing.

In the tech sectors, catalysts are often new products or technologies that should seriously boost business, he said. For pipeline companies, catalysts can be expansions of their network into new, lucrative areas, he added.
3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.21 -0.44%
FB $117.80 -0.22%
GOOG $701.26 0.80%
TSLA $211.34 -5.00%
YHOO $36.94 2.60%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs