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TheStreet Open House

Jim Cramer's Comments on Netflix (NFLX), Chipotle (CMG) Earnings

Stock quotes in this article: NFLX, CMG

NEW YORK (TheStreet) -- TheStreet's Jim Cramer says Netflix  (NFLX) and Chipotle  (CMG) are stories about what younger people want.

Cramer says Netflix is down Tuesday because it just met Wall Street's expectations instead of blowing them away. But he thinks investors should take a look at the stock again once it drops below $400 because he thinks it could become an acquisition target. Furthermore, Cramer thinks Netflix's $7.7 billion in obligations is what's causing investors to freak out, rather than the 50 million subscriptions.

Must Watch: Jim Cramer: Netflix and Chipotle are What Young People Want

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TheStreet Ratings team rates Netflix as a "hold" with a ratings score of C+ with the following commentary: 

"We rate NETFLIX INC (NFLX) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet."

You can view the full analysis from the report here: NFLX Ratings Report

Cramer notes Chipotle had the best restaurant retail number so far this year, largely because they are natural and organic, which appeals to younger people. Chipotle specifically mentioned teen males as the group that is doing well and sales in California are "like shooting fish in a barrel." Cramer says this was "a remarkable quarter from a remarkable company." CMG Chart CMG data by YCharts

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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