Jim Cramer on Tesla's $100 Billion Market Cap, IBM and Phase Two

It's a good day to be Elon Musk. Here's what Jim Cramer's watching Wednesday from IBM to Tesla.
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Happy hump day! 

Jim Cramer is breaking down the possibility of phase two trade talks, Tesla's $100 billion market cap, and IBM's earnings. 

Should We Start Prepping for Phase Two?

President Donald Trump has been talking trade while in Davos, Switzerland for the World Economic Forum.

"And yes, we’re starting phase two very soon. But the relationship that we have now with China is probably better than it’s ever been. The relationship I have with President Xi, president for life. Okay? It’s not bad. But the relationship I have with President Xi is, you know, I think extraordinary, considering he’s for China, I’m for us," President Trump told CNBC's Joe Kernen earlier Wednesday morning. 

But the question is, with all of the ups and downs we saw in the phase one deal, should investors put their faith in this relationship?

Tesla's Market Cap Is Over $100 Billion

Tesla officially has a market cap of over $100 billion and it's nearly $600 a share. 

Right now, it's trading over $570.

The stock is up over 100% in the past three months, and 90% in the past year. 

Tesla shares have more than doubled over the past six months as analysts and investors reset profit expectations for the electric car market's industry leader amid stronger-than-expected quarterly delivery figures, the ongoing expansion of production facilities in China and a more disciplined approach to communications and stewardship from founder and CEO Musk. 

Jim Cramer wrote about Tesla in his Real Money column Wednesday morning. 

The title of his column? "Think of Tesla as a tech equity, not an auto stock."

If we're removing Tesla from the list of automotive companies, then the question remains--is there a company that can even begin to compete with Tesla? Or is it just in a league of its own? 

IBM's Earnings

Real Money Stock of the Day IBM released earnings that came in at $4.71 per share, 2 cents ahead of the Street consensus forecast. Group revenues, IBM said, were largely flat to last year at $21.78 billion, but that figure topped analysts' estimates of a $21.64 billion tally. 

"With our high-value mix and focus on productivity, we expanded our gross margin and we had strong free cash flow generation," IBM CFO James Kavanaugh told investors on a conference call late Tuesday. "With this trajectory, in 2020, we expect to grow revenue, operating earnings per share and free cash flow, and expand operating gross margin." 

But investors have continually heard, "Red Hat, Red Hat, Red Hat," since IBM's acquisition. So, what else do investors have to look forward to?

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