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Zev Fima: Three earnings reports that were watching this week.
Jeff Marks: So busy week earnings. So the first one I have my eye on is Wednesday after the Bell, Lam research. It's an Action Alerts PLUS name. We actually initiated a position in this company a couple of months ago. What I'm interested in here is their commentary around this cycle. You know there's been a classic bull debate right now, the semiconductor investment cycle. It's the classic bull/ bear debate right now is whether the turn will kind of happen in the end, back half of 2019 or if it's more 2020 based. Any visibility into those cycle dynamics is what investors are going to be looking for when it comes in terms of semis.
Zev Fima: And if I can just real quick to clarify Lam Research is a capital equipments name. So the equipment sold by Lam Research is used by semi conductor manufacturers in the production of semiconductors. Samsung, SK Hynix. And when Jeff was talking about are we going to get this bottoming, what we're really talking about is a bottoming in the D-Ram cycle, because once that starts to taper off, capex has already started coming down and once the capex comes back into play, that's all to the benefit of Lam Research.
Jeff Marks: And if you look at what semis or inputs in, I mean it's an, it's in the data center. It's a autonomous vehicle. So there's a lot of strong expectations where demand will be, you know, very strong for the next couple of years. I think Lam is, you know, they're, they're putting out like a $15 earnings power target over the next couple of years. But we'll need that visibility on where the inflection it's gonna take place.
Zev Fima: Absolutely. And then longer term, the other thing to keep in mind is also internet of things. Edge computing. All of this is really, also started another debate, which is are semis, which have traditionally always been boom bust and very cyclical. Is that becoming a little bit more secular? People thought that would happen with Microsoft. Well, excuse me with Micron. The last time around wasn't exactly the case but we are looking for that. So Jeff, any other earnings?
Jeff Marks: Yeah, so we also have Amazon this week, right? A huge play here and I think there's multiple read throughs here. One, ecommerce. It'll give you kind of sort of the strength and tastes of the consumer, what they're doing and it's push on on the domestic and international side. Because if you recall last quarter investors took issue with Amazon's guidance because of some regulatory restrictions in India taking place on their ecommerce business. So we'll see if that was management being kind of conservative there. If there, if there is something really we need to dig deeper on.
Zev Fima: Walmart's another one to watch on that because Flipkart..
Jeff Marks: Yeah same player flipcart as well. So you'll, you'll actually, you'll see read throughs from Amazon's quarter into Walmart too when they report as well. And then also AWS, I mean is the cloud, it's a cloud business of, of Amazon and, and you know, all points are leading to have another strong quarter of growth for that business. So you know, Amazon's a huge player. Huge Action Alerts PLUS name. So it's a big exciting event there.
Zev Fima: Right. And we're going to dig into all of this again on Action Alerts PLUS on the paid for version. We're talking about margins. The fact that it's investment year. All the things like that. And Jeff, I know you're watching one more. I mean we're watching a lot of earnings this week, but there is one more key earning.
Jeff Marks: So Boeing reports this week, right. And we've seen price moves in Boeing kind of really judge the day of the Dow Jones Industrial average. Largest waiting. So it can kind of swing it. I mean the Dow isn't a great read anymore. You got to look more like the S&P 500 but people still take interest in where and how many points the Dow is moving. So the key to watch there is what they say about the 737. A lot of people are expecting a downward revision to cashflow guidance for this year. So that's going to affect Boeing and what investors, how they price it because people look at the free cash flow yield on that one for how to gauge it.
Zev Fima: Commentary on production numbers.
Jeff Marks: Exactly. But you know, I think a less controversial way to play the aerospace business, which is still very strong business right now outside of what's going on with the 737 is Honeywell who reported an absolutely fantastic quarter last Thursday. Action Alerts PLUS name. They delivered 8% organic growth, which might be the best for an industrial this earning season. I'm going to say that, yeah, an acceleration from 6% the previous quarter. So less contraversial way, great aerospace business, warehouse automation, tons of other areas. So if you're looking for more coverage on Honeywell and why a lot of analysts today raised the price target up to like 180's. I wanna even say 190 today. You would want to get over to Action Alerts PLUS cause we covered that in detail last week.

It's a big week for earnings.

Jeff Marks, senior analyst for Jim Cramer's Action Alerts Plus members-only investing club, zeros in on three earnings reports that the club is keeping its eye on this week:


Lam Research  (LRCX - Get Report)

"What I'm interested to hear is their commentary around this cycle. You know there's been a classic bull debate right now, the semiconductor investment cycle. The classic bull-bear debate right now is whether the turn will kind of happen in the end to the back half of 2019 or if it's more 2020-based. Any visibility into those cycle dynamics is what investors are going to be looking for when it comes in terms of semis."

Lam Research reports after the bell on April 24. 

Amazon  (AMZN - Get Report)


"It'll give you kind of sort of the strength and tastes of the consumer... if you recall last quarter investors took issue with Amazon guidance because of some regulatory restrictions in India taking place on their e-commerce business. So we'll see if that was management being kind of conservative there...And then also AWS, it's a cloud business of, of Amazon and, and you know, all points are leading to have another strong quarter of growth for that business. So you know, Amazon's a huge player. Huge Action Alerts Plus name. So, it's a big exciting event there."

Amazon reports after the bell on April 25. 

Boeing  (BA - Get Report)

"So the key to watch there is what they say about the 737, a lot of people are expecting a downward revision to cashflow guidance for this year. So that's going to affect, you know, Boeing and what investors, how they price it because people look at the free cash flow yield on that one and to how to gauge it."

Boeing reports before the bell on April 24. 

Lam Research, Amazon, and Boeing are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells the stocks? Learn more now.

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