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All About Earnings: Cramer's 'Mad Money' Recap (Monday 7/27/20)

Jim Cramer says this is a confusing and overwhelming week for earnings. He's got your game plan.
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This week is all about one thing: earnings, Jim Cramer told his Mad Money viewers Monday. This is when investors will decide if they're sticking with big tech or rotating instead into other sectors.

Tuesday's earnings will include a number of Cramer favorites, including McDonald's  (MCD) , Pfizer  (PFE)  and 3M  (MMM) , all of which should be strong amid the pandemic. Cramer was also bullish on Starbucks  (SBUX) , Raytheon  (RTX)  and Advanced Micro Devices  (AMD) , after rival Intel  (INTC)  stumbled.

Wednesday's earnings will have some Cramer favorites, like ServiceNow  (NOW) , Shopify  (SHOP)  and PayPal  (PYPL) , but also some stocks he'd avoid, namely General Electric  (GE)  and Boeing  (BA) .

But the real fireworks will be on Thursday, Cramer said, when we'll hear from AstraZeneca  (AZN)  and Eli Lilly  (LLY) , as well as the big four tech names, Amazon  (AMZN) , Apple  (AAPL) , Facebook  (FB)  and Alphabet  (GOOGL) . Cramer is expecting good news from all four, despite their CEOs testifying before Congress on Wednesday.

Finally, on Friday, we'll hear from oil giants ExxonMobil  (XOM)  and Chevron  (CVX) . Cramer said he's still betting on Chevron. He was also bullish on Caterpillar  (CAT)  given that both oil and China appear to have bottomed.

Cramer and the AAP team are looking at everything from earnings and tariffs to the Federal Reserve. Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts Plus.

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Special Interview: Kevin McCarthy

In a special interview, Cramer spoke with House Minority Leader Kevin McCarthy (R.-CA), for a Republican take on the upcoming stimulus package working its way through Congress.

McCarthy started off by paying tribute to the late Rep. John Lewis, who received an emotional ceremony at the Capitol earlier today. He said Lewis will be sincerely missed by all who knew him.

Turning to the topic of stimulus, McCarthy said our government was designed for compromise and over the next week, we'll be seeing government in action as the House and Senate, Democrats and Republicans come to an agreement for keeping our economy moving during this pandemic. He said one size does not fit all when it comes to unemployment assistance, which is why Republicans are proposing a percentage of what states are paying for those out of work. McCarthy was also bullish on helping small businesses survive with liability insurance and other measures to help already approved government assistance reach those who need it most.

"I believe we can get there," McCarthy concluded, noting that he expects a compromise deal by the first week of August.

Executive Decision: Mattel

In his first "Executive Decision" segment of the week, Cramer spoke with Ynon Kreiz, chairman and CEO of toymaker Mattel  (MAT) , which reported strong earnings this quarter, but saw its shares plunge as a result.

Kreiz said Mattel's quarter exceeded all of their expectations, despite the COVID-19 pandemic. He said sales were strong in North America and Mattel achieved its highest gross margins since 2016. Much of that success, he added, stemmed from great execution and the resilience of their many brands.

Barbie was one of those strengths, he said, posting 10% revenue growth and a 35% pickup in consumer demand. That growth was led by new innovations, cultural developments and original content that is creating more interest in the brand.

Kreiz also touted Mattel's Play Fair program, which supports diversity through its products and content. But beyond their products, Kreiz added that Mattel is actively promoting females and minorities at all levels of their company and supports diversity.

Cramer said he believes the turnaround at Mattel is for real.

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Executive Decision: Skyworks Solutions

For his second "Executive Decision" segment, Cramer also spoke with Liam Griffin, president and CEO of Skyworks Solutions  (SWKS) , the semiconductor maker that just posted a 12-cents-a-share earnings beat with bullish forecasts for the rest of 2020.

Griffin said the world is changing rapidly and the need for seamless, secure wireless communications is essential. He said the 5G wireless transition represents a huge opportunity for Skyworks in many areas.

When asked about the coming transition to 5G, Griffin noted that less than 10% of all devices available today have 5G, but over the next 12 months, he said everyone will have 5G-enabled devices and the carriers will be expanding their 5G coverage to support them.

Cramer said he remains a big believer in the company and felt they've earned every bit of their success.

We Underestimated the Virus

In his "No-Huddle Offense" segment, Cramer said there's only one truth about this virus and that's how we've underestimated it every step of the way.

We've been living with this coronavirus for six months and it's clear that the virus is still winning. We still don't have rapid testing, nor has any country really gotten the virus under control. Those with early successes are already seeing second waves, while the U.S. is still gripped by the first wave.

Just look at how fast Major League Baseball lost control, with an outbreak occurring right after opening day.

Cramer said Congress shouldn't be grilling tech CEOs, they should be grilling our medical testing industry, which has been allowed to degrade into a duopoly with no competition.

Lightning Round

Here's what Jim Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Monday evening:

Alteryx  (AYX) : "I love that company."

Oneok  (OKE) : "I feel like the dividend is going to be cut. Get out of that industry."

TransMedics Group  (TMDX) : "That's a speculative situation but I bless it. "

AT&T  (T) : "The stock still yielding 7% makes me uncomfortable."

American Express  (AXP) : "That quarter was terrific and I'm now OK with it. "

Sunrun  (RUN) : "That's too much of a run. We need to take some money off the table."

Bloomin' Brands  (BLMN) : "They look like they can handle social distancing. I'm OK with it."

Intel  (INTC) : "It's too low to sell but I don't have a reason to buy it."

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At the time of publication, Cramer's Action Alerts PLUS had a position in SBUX, AMD, AMZN, AAPL, FB, GOOGL.