If you want to know how the stock market can keep soaring while COVID cases continue to rise, look no further than the earnings, Jim Cramer told his Mad Money viewers Friday. There are a lot of companies making a lot of money, he said, and many of them will be on display next week.
Cramer's game plan for next week starts on Monday with earnings from Palo Alto Networks (PANW) - Get Report and Tyson Foods (TSN) - Get Report. Cramer said cybersecurity remains strong, but Tyson hasn't delivered on its earnings in a long time.
Next, on Tuesday, Cramer will be watching retail earnings from Walmart (WMT) - Get Report, Home Depot (HD) - Get Report and Kohls (KSS) - Get Report, but noted that Kohl's remains problematic as it was not deemed essential in the last round of COVID shutdowns. Chinese electric vehicle Maker Nio (NIO) - Get Report will also report on Tuesday, but Cramer said this company is still losing a ton of money.
Wednesday brings more retail earnings with Target (TGT) - Get Report, Lowe's (LOW) - Get Report and TJX Companies (TJX) - Get Report all reporting, along with chipmaker and long-time Cramer favorite Nvidia (NVDA) - Get Report. Cramer said he'd buy Target and Lowe's on Tuesday, but TJX is tougher, as the company has nothing compelling to boost short-term earnings.
Thursday brings earnings from Macy's (M) - Get Report and cloud software provider Workday (WDAY) - Get Report. He said Macy's is unlikely to impress Wall Street and Workday has historically been tough for investors to understand.
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Executive Decision: GrowGeneration
In his first "Executive Decision" segment, Cramer spoke with Darren Lampert, co-founder and CEO of GrowGeneration (GRWG) - Get Report, the hydroponic equipment supplier that just posted strong earnings with raised guidance.
Lampert said that cannabis had a great night on election night with four states approving measures to loosen restrictions. He said every time cannabis is on the ballot, it gets passed and GrowGeneration sees big markets in states like Arizona and New Jersey.
GrowGeneration is taking a duel-tier approach to its growth, Lampert said, both building new stores in new markets and making acquisitions in established ones. The company expects to acquire another 50 to 100 locations over the next year.
Lampert noted that private label is also a focus for GrowGeneration. Only 1% to 2% of current sales are private label, he said, but they are targeting 10% for 2021.
When asked about their offerings, Lampert said they sell everything for not only cannabis, but also organic vegetables as well. From climate control to lighting and watering, if you need consistency for your crops, you need hydroponics.
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Executive Decision: Bill.com
For his second "Executive Decision" segment, Cramer also spoke with Rene LaCerte, founder and CEO of Bill.com (BILL) - Get Report, the digital billing platform that's moving the back office into your back pocket.
LaCerte said that 90% of all businesses still do their billing on paper, which is a pain that nobody wants. The company has over 100,000 customers, from large enterprises all the way to local soccer clubs, that have now switched to digital processing of accounts receivable and payable.
LaCerte noted that Bill.com is only scratching the surface, as there are over six million businesses in the U.S.
When asked how COVID has affected small business, LaCerte noted that as soon as they saw a dip in volumes, Bill.com leapt into action to help with discounted prices, charitable funds and grants. Those initiatives led to a growing customer base that is using their service to become more efficient and stay in business.
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Off the Charts: VIX
In the "Off The Charts" segment, Cramer checked in with colleague Mark Sebastian for a read on market sentiment using the CBOE Volatility Index, or VIX, which is also known as the market's "fear gauge."
Sebastian first looked at a daily chart of the S&P 500 compared to the VIX since July and noted that unlike typical patterns, where the market and the VIX trade inversely, heading into July, the two traded in tandem, warning of the market selloff in September.
Over the past two weeks however, as the market roared, the VIX plunged, signifying that we have a healthy market where fear is declining.
Cramer said this change in sentiment makes sense, as investors were initially afraid of all stocks except for the COVID winners, but now are only afraid of a handful of stocks, namely tech.
Sebastian looked into this trend as well, comparing the spread between the VIX and its Nasdaq counterpart, the VXN. He felt the current spread of six would widen to 10 before the bull market comes to an end.
Business as a Force for Change
In his No-Huddle Offense segment, Cramer answered the question of how the stock market can continue to hit new highs while the pandemic rages on. He said it's because business is the greatest force for change in our country. He said when corporate America wants to get something done, it gets it done.
Big businesses know how to cope with this pandemic and their earnings prove it. They have deep pockets. They have great leadership. And they're big enough to weather the storm. CEOs can't pretend the virus doesn't exist or will just go away like the White House can, Cramer said, and that's why they continue to defy the odds, put plans into place and adapt to these changing conditions.
Here's what Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Friday evening:
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At the time of publication, Cramer's Action Alerts PLUS had a position in NVDA.