Jim Cramer and Katherine Ross discuss Chipotle (CMG) - Get Report earnings, why he likes Southwest (LUV) - Get Report the most out of the airlines, and Ford (F) - Get Report getting hit yet again by the chip shortage. Watch the full conversation in the video below:
FAANG Isn't Dead
That's the message that Cramer has for investors.
"Credit. Who gets it? Who doesn't? That's often that it all comes down to and this earnings period is more about credit - the belief in management's ability to navigate these waters - than I have ever seen," Cramer wrote in an afternoon column on Wednesday on Real Money.
"Exhibit A is Netflix (NFLX) , which last night reported an extremely disappointing sign-ups and then gave you an even more depressing outlook about future growth. Hmm, let's see, not so hot quarter, with little hope for better? That's how people interpreted the quarter," he continued.
"That's not how I interpreted it though. Netflix is distinctly not a headline story. You simply cannot make up your mind about this stock unless you read the company's letter to shareholders and then watch the video of management answering questions from an interlocutor. Reed Hastings, one of my absolute favorite CEOs, and why not, his company is the N in FAANG, the pantheon of great stocks of the era - picks a new interviewer to shoot queries to the executive team and this time he picked Nidhi Gupta, an analyst from Fidelity, who wasted no time asking tough questions like why were they so far off of the street's projections and even their own estimates," Cramer wrote.
Is the Stock Market Dangerous?
No, Cramer said on Mad Money on Wednesday night.
"In his "No Huddle Offense" segment, Cramer talked about those who believe the stock market is dangerous. While there are plenty of reasons to worry about SPACs, NFTs and meme stocks, there are plenty of stocks that are still bargains," TheStreet's Scott Rutt wrote in his Mad Money recap.
"Take, for example, the bidding war underway for railroad Kansas City Southern (KSU) - Get Report. He said sometimes companies are willing to pay a lot more for a company than the market, and Kansas City Southern just proved it," he continued.
And, Finally, Southwest Earnings
Southwest reported an adjusted loss of $1 billion, or $1.72 a share, vs. a loss of $77 million, or 15 cents a share, a year earlier. Analysts polled by FactSet had been expecting a loss of $1.85 a share.
“While the pandemic is not over, we believe the worst is behind us, in terms of the severity of the negative impact on travel demand,” CEO Gary Kelly said in a statement. "Vaccinations are on the rise, and COVID-19 hospitalizations in the United States are down significantly from their peak in January 2021. As a result, we are experiencing steady weekly improvements in domestic leisure bookings, which began in mid-February 2021."