Be ready to buy the next market dip, because 2019 might turn out to be surprisingly rewarding, Jim Cramer told his Mad Money viewers Friday. Now that the Federal Reserve has taken a pause, it's clear many companies have gotten their mojo back, Cramer said, and next week's earnings should prove it.
Cramer's game plan for next week started on Monday with Clorox (CLX) and Alphabet (GOOGL) . He expects Clorox to have an excellent quarter, but was worried that Amazon's (AMZN) decline today could impact Alphabet next week. He recommended buying Amazon after Tuesday, when the selling subsides.
Next, on Tuesday, Cramer was bullish on BP (BP) , which still sports a great dividend; Estee Lauder (EL) , and Ralph Lauren (RL) . He was also looking for great things from Walt Disney Co. (DIS) , which continues to make strides in its streaming businesses.
Wednesday brings earnings from Eli Lilly (LLY) , which Cramer called the best of the pharma stocks, along with Spotify (SPOT) and Take-Two Interactive (TTWO) . Both Spotify and Take-Two have their share of skeptics, Cramer said, but he believes in their long-term trends. He was also upbeat on Chipotle Mexican Grill (CMG) , which continues its turnaround efforts.
Then on Thursday, it will be Twitter (TWTR) , GrubHub (GRUB) and toymaker Mattel (MAT) reporting. Cramer was bullish on Twitter as an alternative advertising platform to Google and Facebook (FB) . He said that GrubHub should also be strong given the red-hot delivery market. He was bearish only on Mattel, but felt that rival Hasbro (HAS) , which reports Friday, should be strong.
Also on Friday, we will see earnings from Ventas (VTR) , and Cramer said he would be a buyer ahead of those results.
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Past Performance Is No Guarantee
As goes January, so goes the year, the old saying goes. But Cramer said that this year, that's just nonsense. The market's 8% run in January has absolutely no bearing on the next 11 months, he said, because January's bull market was a direct result of the fourth-quarter bear market.
In October, the Fed chose to squash the economic expansion no matter the cost, and that's exactly what happened. But by December, Fed chair Jay Powell realized he'd made a mistake and changed course. The market promptly followed suit.
Investors who place their confidence in the calendar are greatly mistaken, Cramer concluded. The markets move more by chance and outside events, not by predictable patterns from years past.
Over on Real Money, Cramer says buying on weakness is a good strategy this earnings season. Get more of his insights with a free trial subscription to Real Money.
Outlook for eBay
Who's the best person to turn things around at the lagging eBay (EBAY) ? The current CEO, Cramer argued, but he should do it with the help of activist investor Elliot Management.
Shares of eBay spiked 6% on the news that Elliott had taken a stake in the company and was advocating for change. Cramer said that was for good reason, as Elliott has an excellent track record for unlocking value. Elliott's ideas for spinning off eBay's StubHub and classified businesses make a lot of sense, Cramer argued, but what doesn't make sense is a proxy fight to get it done.
All too often, management teams dig in their heels and fight to the death to prevent activists from getting their way. But Cramer advocated that Elliott and eBay work together to accomplish their common goals. He said eBay's recent dividend and stock buyback is a good sign that management might actually be listening. If so, shareholders will reap the rewards.
Executive Decision: ADP
For his "Executive Decision" segment, Cramer sat down with Carlos Rodriguez, president and CEO of Automatic Data Processing (ADP) , our nation's largest payroll processor.
Rodriguez said despite seeing a lot of fear and uncertainty in December, ADP continues to see steady growth in both employment and wages. The economy still has a lot of momentum, he said, even with the recent government shutdown.
Rodriguez was most excited about ADP's human capital management offerings. It's tough to be an employer, he said, and especially if you're a small employer. That's why ADP offers a lot more than just payroll. They can offer complete human resource outsourcing as well to handle things like benefits, retirement plans, compliance and more. For smaller companies competing for talent, these services are crucial.
Cramer said the best way to play our growing economy continues to be with ADP.
Off the Tape: Carbon
In his "Off The Tape" segment, Cramer sat down with Joseph DeSimone, co-founder and CEO of the privately held Carbon, a company developing new technology as an alternative to traditional 3D printing.
DeSimone said when it comes to sports, no matter what sport you're playing, the name of the game is protection. Football helmets, he said, have been using the same foam insides since 1937, but now with digital technology, then can scan an individual's head, use cloud computing to determine the best lattice matrix to dissipate energy, then print that lattice to ensure the best possible fit and protection.
DeSimone said the same technology can be used in items like running shoes and countless other items. Carbon has been working with Ford (F) and has the first production-ready parts in some of Ford's newest vehicles.
When asked about the business, Desimone said that Carbon sells both the 3D printers and the resins to manufacture the various parts. The injection moulding business alone represents a $300 billion opportunity, he said.
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