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Cramer's Mad Money Recap: Apple, AT&T, Chevron

Playing the earnings games is harder than it looks. What defines a winner in this earnings season? Jim Cramer explains.
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If you're looking for stocks to bet on this earnings season, Jim Cramer's got your guide to what makes a winner. He told his Mad Money viewers Tuesday that whether you're an investor, trader, or a gambler, this is what matters most when the earnings reports are flying by faster than the market can process them.

First, remember this game is harder than it looks. There's always a surprise factor at play, which is why UPS's  (UPS) - Get United Parcel Service, Inc. Class B Report surprise earnings sent shares up 10.4%.

Second, always bet on stocks where you believe in the CEO. Stocks like Apple  (AAPL) - Get Apple Inc. Report are chronically underrated, but the uptick in remote work means great things for Apple in the enterprise area.

Third, look for stocks that are cheap versus their peers. Cramer remained a fan of Goldman Sachs  (GS) - Get Goldman Sachs Group, Inc. Report and Wells Fargo  (WFC) - Get Wells Fargo & Company Report, along with Ford Motor  (F) - Get Ford Motor Company Report, all of which are worth more than what they're trading for.

Fourth, consider stocks that reported strong results but failed to rally. Tesla  (TSLA) - Get Tesla Inc Report shares dipped 4.5% Tuesday on strong results that failed to impress investors. That's your cue.

Next, when it comes to earnings, you can't have just one surprise. Case in point: Netflix  (NFLX) - Get Netflix, Inc. Report, which seems to only rally on both strong earnings and strong subscriber growth. Miss one of those two and it's game over until next quarter.

Sixth, if your stock is a pandemic winner, make sure it's not slowing down. In our post-pandemic world, any weakness is to be avoided at all costs.

Finally, investors should look for stocks that should have gone up more. Stocks like Honeywell International  (HON) - Get Honeywell International Inc. Report and Union Pacific  (UNP) - Get Union Pacific Corporation Report both have bright futures ahead, but you wouldn't know it by looking at their post-earnings share prices.

Cramer and the AAP team are looking at everything from earnings and politics 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.

Cramer's Top Dividend Stocks

Last week, the market panicked over proposed increases to the capital gains tax rate. But that only made dividend stocks that much more valuable. Here are Cramer's top 10 high-yielding dividend stocks.

Topping the list was AT&T  (T) - Get AT&T Inc. Report, with a 6.7% yield. The company just posted its first excellent quarter in ages. Second was Kinder Morgan  (KMI) - Get Kinder Morgan Inc Class P Report, yielding 6.3%. This stock has also been in the doghouse for ages but is finally turning itself around. Next was Chevron  (CVX) - Get Chevron Corporation Report, Cramer's favorite oil stock along with Pioneer Natural Resources  (PXD) - Get Pioneer Natural Resources Company Report.

Also making the list were AbbVie  (ABBV) - Get AbbVie, Inc. Report, which recently acquired Allergan, IBM  (IBM) - Get International Business Machines Corporation Report, which is breaking itself up to spur growth, and Dow  (DOW) - Get Dow, Inc. Report, with a 4.5% yield and elevated demand for its products.

Next was Simon Property Group  (SPG) - Get Simon Property Group, Inc. Report, the mall REIT that still has a 4.2% yield. Pfizer  (PFE) - Get Pfizer Inc. Report came in at No. 8, with shares sporting a 4% yield, trading at 12 times earnings. At No. 9 was LyondellBasell  (LYB) - Get LyondellBasell Industries NV Report, the only stock on the list Cramer advised waiting to purchase. The company reports later this week.

Finally, Crown Castle  (CCI) - Get Crown Castle International Corp Report finished the list, with only a 2.9% yield but lots of growth given the 5G wireless buildout.

Executive Decision: Centene

In his "Executive Decision" segment, Cramer spoke with Michael Neidorff, chairman, president and CEO of Centene Corp.  (CNC) - Get Centene Corporation Report, the health plan provider that delivered a top and bottom line beat with strong guidance but saw its shares plunge 7.1%.

Neidorff said the market is fickle at the moment and investors were concerned over rising medical losses. However, the losses were COVID-related and a one-time occurrence. Other than that line item, Centene increased revenue and earnings and saw a lot of tailwinds going into the back half of the year.

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Additionally, while Centene lost 270,000 subscribers, presumably due to COVID hardships, they also added over 300,000 new subscribers as the recovery got underway.

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.

Off the Charts

In the "Off The Charts" segment, Cramer checked in with colleague Carolyn Boroden, the "Fibonacci Queen," for an update on her take on the markets and her favorite stock.

Boroden turned cautious on the market overall, noting that the S&P 500 index has broken through her price targets of 4,012 and 4,090, making it ripe for a pullback. Her Fibonacci timing cycles indicated Friday could be when a turn to the downside occurs.

The sign to watch for is if the 5-day exponential moving average crosses below the 13-day exponential moving average. If it does, the floor of support would be near 3,720.

Boroden next looked at the largest stock in the S&P, Apple. She noted that after bottoming at $116 on March 8, shares have been steadily climbing. Her analysis indicated $153 to $163 a share is likely for Apple.

Reddit's Wall Street Bets

In his "No Huddle Offense" segment, Cramer told viewers that Reddit's "Wall Street Bets" message board, with its 10 million subscribers, is moving stocks left and right and cannot be ignored.

The group's latest target, MicroVision  (MVIS) - Get MicroVision, Inc. Report, a small-cap maker of LIDAR with a huge short position. This $2 stock traded over $30 this week as the Reddit crowd is piling in, hoping to break the short sellers.

Cramer said he's not a fan of this style of investing, nor the religion that often accompanies it, but he did admit the strategy has been amazingly successful. The Reddit crowd helped keep GameStop  (GME) - Get GameStop Corp. Class A Report and AMC Entertainment  (AMC) - Get AMC Entertainment Holdings, Inc. Class A Report alive, and now they're doing the same with MicroVision.

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" Tuesday evening:

Activision Blizzard  (ATVI) - Get Activision Blizzard, Inc. Report: "That's a good company and I'm a buyer."

Coty  (COTY) - Get Coty Inc. Class A Report: "I think they're making a comeback, but I suggest you buy Estee Lauder  (EL) - Get Estee Lauder Companies Inc. Class A Report."

DraftKings  (DKNG) - Get DraftKings Inc Class A Report: "I think this is a strong franchise. NBA gambling should be strong this year."

Futu Holdings  (FUTU) : "No, that's a Chinese company. I like Baidu.com  (BIDU) - Get Baidu Inc. Report, JD.com  (JD) - Get JD.com Inc. Report and Alibaba  (BABA) - Get Alibaba Group Holding Ltd. Report, that's it."

Advance Auto Parts  (AAP) - Get Advance Auto Parts, Inc. Report: "I think that's a great stock. I'm behind it."

Rocket Companies  (RKT) - Get Rocket Companies Inc Class A Report: "I think these guys are very good at what they do. I'd buy a little more."

Enphase Energy  (ENPH) - Get Enphase Energy, Inc. Report: "This is a high-multiple stock. I'd start half of a position here."

XL Fleet XL: "I can't recommend it right now."

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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, UPS, WFC, HON, UNP, ABBV.