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How Can a Stock Gain on Missed Earnings Expectations? Jim Cramer Explains

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If you thought stocks live and die on earnings reports, think again.

 While earnings certainly play into how stocks move, an earnings miss won't necessarily send your favorite stock into the red.

 Why you ask? Well, it's complicated, and that's why we have Jim Cramer break it down.

"[If a company says] we missed expectations, but you know what your every year we're going to be pretty good, A year over year is a clarion call to say, you know what? I got to get when I hear missed expectations, I then look at the next, which is it? We're now in July. In July you're able to make a forecast for 2020," said Cramer. 

 And it's worth noting that that stocks can also fall on an earnings beat. Watch Cramer explain that one here.

 Related. Jim Cramer: 4 Reasons Why Oil Has Not Recovered


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