A lot of companies are reporting earnings next week, Jim Cramer told his Mad Money viewers Friday, but the biggest story will be any news on the latest coronavirus outbreak and whether health officials are able to get the epidemic contained as it spreads out of China.
On Wall Street Friday, stocks finish down after the Centers for Disease Control confirmed a second patient in the U.S. has been infected with the coronavirus, designated 2019-nCoV.
Cramer said the effects of this coronavirus remain an unknown: It probably will be under control, but investors should keep an eye out in case worries about the virus start to impact travel-related sectors, such as hotels, casinos, cruise lines, luxury good makers and airlines.
Next, on Tuesday we hear from United Technologies (UTX) - Get Report, which should update investors on their merger with Raytheon (RTN) - Get Report. Cramer was bullish on Apple (AAPL) - Get Report and Advanced Micro Devices (AMD) - Get Report, but cautioned that both stocks have run going into earnings. He was also cautious on 3M (MMM) - Get Report and Starbucks (SBUX) - Get Report, but liked HCA Healthcare (HCA) - Get Report.
Wednesday brings earnings from Boeing (BA) - Get Report, who will update investors on the 737 Max saga. Cramer was bullish on the other companies reporting on Wednesday, including Facebook (FB) - Get Report, Microsoft (MSFT) - Get Report and Goldman Sachs (GS) - Get Report.
The earnings continue on Thursday with Coca-Cola (KO) - Get Report and Verizon (VZ) - Get Report reporting. We'll also hear from Amazon AMZN, which Cramer cautioned is still in spending mode, and will likely not make the analysts happy. He was bullish on Western Digital (WDC) - Get Report.
Finally, on Friday we get earnings from Exxon Mobil (XOM) - Get Report and Chevron (CVX) - Get Report, two great oil producers. Unfortunately, the world is turning against fossil fuels and Cramer said he can't recommend these stocks any longer.
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.
Banking on Being Exceptional
Investors need to pay less attention to the market's elevated valuations and focus instead on the anomalies, Cramer told viewers. One of those anomalies is First Horizon National Bank (FHN) - Get Report, whose CEO, Bryan Jordan, appeared on Thursday night's show.
The market hasn't been kind to the financials, Cramer said, and the regional banks are particularly under-appreciated First Horizon operates in the best region of the country, is growing fast and sports a 3.4% dividend. If First Horizon were a fast-growing utility, like American Electric Power (AEP) - Get Report, it would receive a much higher valuation. But despite being conservative and very well run, First Horizon is overlooked by the analysts.
Once First Horizon's merger with Iberiabank is complete, the company will be a regional powerhouse, Cramer said, with lots of great opportunities in Louisiana, Texas, the Carolinas and South Florida.
On Real Money, Cramer keys in on the companies and CEOs he knows best. Get more of his insights with a free trial subscription to Real Money.
What the heck is going on with shares of L Brands (LB) - Get Report? The operators of Victoria's Secret and Bath & Body Works were the fifth worst performer in the S&P 500 last year and shares have collapsed from highs near $98 in 2015 to less than $20 today. But after numerous recent analyst upgrades, Cramer said he's still not convinced the stock is a buy.
There are plenty of reasons to dislike L Brands, Cramer said. The company is largely a mall-based retailer and the Victoria's Secret brand has been falling out of favor for years. With so much new online competition, it's hard to see how the company could turn itself around.
But 10 months ago, activist investors became interested in L Brands and the analysts seemingly now feel that things are so bad, the company has no choice but to take drastic actions to turn itself around.
Cramer said the problem with this theory is that turnarounds take time, and investors could lose a fortune while they wait. He agrees that L Brands has options available to change its fortunes, but investing in the stock at this early stage should be done slowly, if at all.
Cramer Does His Homework
In his "Homework" segment, Cramer followed up on a few stocks that had stumped him during earlier shows. He said that Everbridge (EVBG) - Get Report, the critical event management platform, is an intriguing story. The company debuted at $12 a share and now trades over $90. With strong fundamentals and a new CEO, Cramer said, the stock is still cheap at nine times sales estimates, given its stellar growth rate. He suggested buying the stock, but only into weakness. Shares of Everbridge are up 55% over the past 12 months.
Cramer then followed up on Iveric Bio (ISEE) - Get Report, a speculative biotech with shares that surged 455% on positive data from its clinical trials. Cramer said he has no edge on this stock and after such spectacular gains, investors need to take their winnings and sell. He recommended Regeneron (REGN) - Get Report as his favorite eye care stock.
Am I Diversified?
In the "Am I Diversified" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.
Cramer also took issue with this portfolio, saying it takes on too much risk. He suggested selling Store Capital and Main Street Capital and adding EPR Properties (EPR) - Get Report and ConEd (ED) - Get Report.
Cramer blessed this portfolio as properly diversified.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Friday evening:
Introducing TheStreet Courses: Financial titans Jim Cramer and Robert Powell are bringing their market savvy and investing strategies to you. Learn how to create tax-efficient income, avoid top mistakes, reduce risk and more. With our courses, you will have the tools and knowledge needed to achieve your financial goals. Learn more about TheStreet Courses on investing and personal finance here.
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here.
At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, FB, MSFT, GS, AMZN, UNH.