Misses aside, we're seeing some boffo earnings

Look past the disappointments to find the value this season.

By Jim Cramer Oct 18, 2013 10:26AM

Stock market traders © Photodisc/SuperStockThere's more good than bad in these earnings numbers.

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Sure, IBM (IBM) was abysmal. Goldman Sachs (GS) didn't have enough fixed-income trading to make the numbers. EBay (EBAY) disappointed, as did Xilinx (XLNX) and UnitedHealth (UNH). But let's go underneath. Let's look at the big hits, not just the misses.

 

I think you will find many more good than bad, including this morning's reports from General Electric (GE), which had  been a real laggard, and Schlumberger (SLB), a perpetual star. These two companies gave you exceptional global order growth and look clean.

 

Consider the other contrasts. You may be worried about tech from IBM and Xilinx. But consider Google (GOOG). This gigantic Internet search company has been stalled for the past six months, contributing little to the Nasdaq's historic run. It seemed like Google was just one more company that misjudged the speed with which people went mobile and didn't have the right ad tools to capitalize off of it. Now it seems that the company does have both the ad campaigns and the accelerated viewership, particularly on YouTube, that can be monetized, so there is a healthy and needed revaluation going on. Very clean quarter. Truly offsets whatever IBM has to say.

 

Then how about the opposites to Goldman Sachs? JPMorgan Chase (JPM), ex-litigation, gave us a terrific number, much better than Goldman's. American Express (AXP) was stupendous, frankly, calling into question the whole negative rap about the consumers eBay offered. I thought Wells Fargo (WFC) wasn't perfect, but the market ate it up. Capital One (COF) shot the lights out. They all trump Goldman.

 

Or how about health care? Johnson & Johnson (JNJ) and Abbott (ABT) posted much better-than-expected top and bottom lines. These were very strong quarters.

 

Coca-Cola (KO) wasn't that much to write home about, but the market didn't mind and it loved Pepsico's (PEP) quarter. Sure, Xilinx was a bummer, but Intel (INTC), a much bigger company, delivered what the market wanted or it wouldn't be on the verge of breaking out.

 

Last night Chipotle (CMG) came through with numbers that had the stock vaulting nearly 8 percent premarket. Chipotle's been flying high of late, which worried me that somehow it would disappoint. But the same-store sales numbers came through very strong and the growth prospects, including new concepts like Chop House and new foods like Sofritas, the vegan dish, are just now beginning to roar.

 

I know there are numbers that show that we have had the most downside surprises in years, so far. But I think you need to look at three things to determine a downside surprise:

  1. Did the top line miss?
  2. Did the bottom line miss?
  3. Did the stock do nothing or go up anyway?

If you use that prism, I say so far, so very good.

 

Not a great run for the bears, even as I think they have already qualified the earnings season as a losing one.

Jim Cramer's headshot


Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long WFC, JPM, JNJ and XLNX.





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70Comments
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Anyone else notice that there's more lefty articles on here than usual, and less stories let you comment on them? MSN, write your stories, but let others disagree if neccessary.
Oct 18, 2013 12:29PM
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I'm going to share something with you folks that I believe...... you may not but here it is anyway.

 

Don't do something for someone that they can do for themselves. They end up resenting it in the end. I learned this the hard way in my life and I think it applies to these bloated safety net programs.

 

This does not mean you can't take your wife out and buy her dinner..... so don't go spinning it. JMHO

Oct 18, 2013 11:09AM
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VV, are you suggesting market manipulation .. I  am shocked ... shocked!
Oct 18, 2013 10:55AM
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Please, give us another day free of reference to printing money or tapering ... please!
Oct 18, 2013 12:07PM
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If you see a starving kid and would rather criticize the parents instead of feeding the kid ---- you are not a conservative ...you are an @sshole .....
Oct 18, 2013 11:41AM
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Anyone heard of this:  From FloridaWatchdog.org

A new federal program is giving Florida’s public schools a way out of verifying whether students qualify for free or reduced-price lunches.

The solution: expand subsidized meals to include all students whether they can afford to pay or not.

Known as the Community Eligibility Option, schools and even entire districts can now receive free breakfast and lunch if 40 percent or more of students’ families are identified as low-income.

That includes 83 Duval County schools, 58 schools in Pinellas County and 48 schools in  Polk County — to name three of Florida’s 67 eligible counties.

Students whose families receive food stamps, cash assistance or are Head Start eligible automatically count towards a school’s qualifying percentage.

While it’s unpopular for public officials to oppose programs that purport to help needy children, some experts say there is more to CEO than meets the eye.

Joy Pullman, an education senior fellow at the free-market Heartland Institute, told Florida Watchdog, “The Congressional Budget Office estimated this program would cost taxpayers an extra $11 billion for just the first 11 states that participate.”

“Federal school lunch programs also encourage families to think they don’t need to be responsible for feeding their own children,” Pullmann said. “But, more practically, when the feds subsidize something, they get to define all the parameters.”

CEO was established under the Healthy, Hungry Free Kids Act of 2010. Florida became eligible this year, and the program will become a nationwide option in the 2014-15 school year.




Oct 18, 2013 10:44AM
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Google's not technology they're consumer advertising and spam giving away shareware.

Oct 18, 2013 10:44AM
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doesn't it go hand in hand that stocks have been going up for several years so therefore the detail companies also have some nice earnings? 

Oct 18, 2013 11:10AM
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Restaurant stocks that go up 12.5% on news, man we must be in Recovery and beyond...

Or people have forgotten how to cook...

 

GE is making a decent run this morning, even with so-so numbers....Go GE.

And Google who would have thunk it...?

Oct 18, 2013 10:46AM
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Boffo ...tally ho ...toodle pip ....
Oct 18, 2013 10:49AM
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Outstanding economic news is everywhere ... watch out for market manipulators. Their goal is to  manipulate a sucker's market and recoup their losses for miscalculating the shutdown/debt ceiling fiasco.
Oct 18, 2013 10:48AM
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Apparently the markets are back to their usual exuberant selves. Now that the budget/debt debacle has been kicked down the road for a few months, traders can get back to doing what they do best - basking in the glow that is QE.   Another couple of hundred billion dollars in freshly printed money will make for a nice Christmas....
Oct 18, 2013 10:50AM
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Cramer's recent cheerleading is worrying ..... I suspect those at the top are getting ready to pull the plug so word down through their minions is "get the sheep to buy so we can take our profits" .....the nasdaq in particular seems to have just gone up without regard for fundamentals ......I guess it could also be swing and day traders ...just like 13 years ago !! 

Not gonna short it this time though - but there will be a short side opportunity soon enough.
Oct 18, 2013 11:17AM
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Market manipulation....Actually, I thought that is the only way you could make money on Wall St..?

Buy and sell...

Buy low, sell high..

Buy good dividend paying, appreciating Companies with reasonable growth factors.

This stuff isn't "rocket science" the answers and charts are everywhere..

Pretty simple stuff really...

Oct 18, 2013 12:58PM
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Vincit is right.  This morning is bright and beautiful, just like 'Ms Bambi'...
Dont waste it. Get the heck out of the house.... take that walk.....
do some gardening...... talk to the neighbors....  make a donation to your own life. 

And remember to 'stay long' and hold to your individual investing course.
- At least until Monday.   Cheerio all. ~

Oct 18, 2013 11:09AM
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"Google is not technology they're consumer advertising and spam."

Indeed. For a fact... they are a portal for chronic market gamblers who are so incredibly greedy that they don't see Google for what what it TRULY is. People LOATHE that advertising and- if you read the Twitter spew (pre-IPO blather) it refers to DWINDLING interest, not long-term potential. People want jobs and family-sustaining wages. The crowd that's gone zombie over technology is getting smaller. It used to be that the term "unplugged" referred to a musician winging it on stage... today it refers to pariah like Google's future-- unplugged, as in- unsustainable by it's own efforts. 
Oct 18, 2013 1:30PM
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Rome....I wrote something about Inst. Traders, Analysts, pumping and dumping and guys like me..

Investors/Traders...

It wouldn't post, I finally gave up.....MSN doesn't really like talking about investing on here.

 

So it's better to worry about enjoying life then waste a lot of time with useless bs...

Besides that, I think Miss Lilly wants to boink me...

So I'm going to get off here...I've already taken an aspirin for my heart...

Ciao.

Oct 18, 2013 12:16PM
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The problem I see Vince, is this....

Lately MSN has just been shooting a lot of Articles out the door, maybe for "shock and awe".

They have also posted a few with political undertones lately..Really gets the natives wound up..

 

Why bother with "good substance" articles about investing or financial matters...;

From people like Jubak, Blaine, Mirhardari(s), Brush, Fleck and a few others, when you can get tripe about Wally World, Mickey D's, Yahoo, Google,Facebook and others.

Where 95% of posters or commenters turn it into a bitch and whining column about service or return policies...

And other well written Articles become nothing but a Political blog about someone's agenda or complaints about 2-3 Presidents or Congressional Leaders...And then the racial bullshidt that's prevalent on here...

 

I see this very little on other Blog sites, when discussing the actual values and investing validity of a Company or it's Stock....We discuss the stock and ideas, pro and cons.

(the bullshidt is shouted down, and they are treated as morons, with nothing of value to offer)

VERY FEW DO THAT HERE...

Oct 18, 2013 12:10PM
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Nice little comeback yesterday....Even the Dow almost finished up in the green.....Routine day today. less stress, good volume...S&P at record highs but, its not where we are now, its where we close at 1600 hrs...The Dow being pulled down trying to at least break even....Still 4 hours to go...Do not take anything for granted....More later, if we cant post, have a great weekend all.
Oct 18, 2013 1:08PM
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The manipulation of the Dow today is so obvious, it is embarrassing .. do these institutional traders really think we are so gullible/naive.
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