NEW YORK ( TheStreet) -- "Strong earnings may have alluded the overpaid Wall Street analysts, but they should be anything but surprising for investors at home," Jim Cramer told the viewers of his "Mad Money" TV show Monday. He explained why so many "upside surprises" have been occurring this earnings season, and why these "surprises" should be anything but. So how is it that large institutional investors and hedge fund managers missed the surprise earnings of Caterpillar ( CAT) and Whirlpool ( WHR), along with other companies like Netflix ( NFLX), Deckers Outdoor ( DECK) and Chipotle Mexican Grill ( CMG)? Cramer said it was easy, the analysts simply didn't update their forecasts. Cramer explained that anyone at home, or anyone who watches his show, could easily see that consumer spending has been picking up, and that the emerging markets continue to swell. But most Wall Street analysts only update their outlooks once a quarter, he said, largely ignoring all of the recent good news. Cramer said that for weeks, the executives at Whirlpool have been seeing strength in appliance sales thanks to energy cutting incentives, along with synergies from its Maytag acquisition and strength in Brazil. Yet for the analysts who last updated their outlooks in January, they simply missed it. "If you're waiting for a bell to go off, you're in the wrong game," Cramer told viewers. He said investors need to listen to what companies are saying now and anticipate the move. If they wait to see the positive results, they'll risk missing most of the action. Cramer said the patterns are similar for Caterpillar, which said orders are coming back, and for Netflix, which said it's continuing to see strong growth. The pattern also works for Deckers and Chiptole, where years of growth still remain. "These moves should be anything but surprising," he concluded.
Bullish on OilWith crude oil back over $80 a barrel, Cramer told viewers that the oil drillers are back. He said the Schlumberger ( SLB) conference call was the most bullish industry call he's ever heard. Cramer explained that on the Schlumberger call, the company's CEO said that oil's return to $80 a barrel is based on real demand, not speculation, and that demand will kick off a whole new drilling cycle as drillers begin drilling in earnest to cash in on higher prices. Based on this bullish sentiment, Cramer said investors now "must own" an oil driller, as he believes oil is headed back to $100 a barrel over the next 12 months. But which stock to own? Cramer said he'd be a buyer of Schlumberger, even here at the stock's 52-week high. He said the company's size and expertise allows it to operate all across the globe. "There's a lot to like," he said. But Cramer gave top honors to the smaller Weatherford ( WFT), a stock which he owns for his charitable trust,
Financial Reform WinnersInvestors looking for a winner in the financial reform game should look no further than Intercontinental Exchange ( ICE), Cramer told viewers, but only for a trade. Cramer explained that one of the big changes of the pending financial reforms currently working their way through Congress is to bring derivatives trading out of the back room and into the open on a public exchange. He said that Intercontinental Exchange, or ICE, will be the big winner if this this happens. While derivatives trading only accounts for 5% of ICE's earnings, the boost from the pending legislation is not baked into the company's numbers. But Cramer cautioned that perception may be better than reality, which is why he's not endorsing ICE as a long-term investment. ICE, which has already had a gigantic run, is trading at its 52-week high. Cramer said this may be one case where investors need to buy high and sell higher. For longer term investors, Cramer said the CME Group ( CME) will likely be the longer-term winner when it comes to reforms. He also gave the nod to NYSE Euronext ( NYX) with its 3.5% yield.