What Cramer is watching Wednesday — Netflix’s big rebound, PG beats on earnings

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What I am looking at Wednesday, Oct. 19, 2022 Netflix (NFLX) — Is the pain over? Shares popped more than 12% in the premarket after the streaming platform said it added 2.4 million subscribers in the third quarter, reversing the losing trend of the prior two quarters. Management forecasts another 4.5 million subs. It also beat earnings and sales estimates. Deutsche Bank upgrades NFLX to buy with a price target of $350, up from $270, sees more levers to drive growth. I say buy shares of Club name Disney (DIS) off of this report. The 2-year Treasury yield is 4.48%. Procter & Gamble (PG) posted quarterly earnings of $1.57 per share, beating Wall Street estimates of $1.54. The consumer goods giant’s organic volume dropped 3%, but sales rose 7%. By division: Organic grooming sales rose 5%; health care up 8%; fabric and home care up 8%; beauty plus 4%; and baby, feminine and family care increased 6%. Management cut it’s full-year revenue forecast as the strong U.S. dollar remains a major headwind. Barclays lowered price targets: ConocoPhillips (COP) to $135 from $153; APA Corp (APA) to $46 from $53; Coterra Energy (CTRA) to $39 from $43. But analyst raised PT for Occidental Petroleum (OXY) to $84 from $75. Microsoft (MSFT) price target lowered to $282 from $300 at Citi — estimates still too high … ServiceNow (NOW) — expect disappointment according Citi analyst’s “cautious” conversations with partners … lowered price target to $488 from $575. McDonald’s (MCD)– PT dropped to $272 from $287 at Credit Suisse. But stays buy, still likes it … this is the UNH of restaurant chains. UBS says be careful with Twilio (TWLO) ahead of the company’s analyst day and Q3 results on Nov. 3. Slashes price target to $94 from $170. Weird call: Barclays cuts PT for Kinder Morgan (KMI) to $20 from $21 and worries about demand. JB Hunt Transport (JBHT) reported better-than-expected third-quarter profits and revenue. But logistics company said: “We have seen improvements in the areas around professional driver recruiting and retention, although at elevated cost. That said, we have not seen much improvement in equipment availability, which continues to put pressure on our maintenance costs.” Lowe’s (LOW) initiated with a market perform (hold) at Cowen … sees management strengthening fundamentals including stores, supply chain and products. But analyst said on sideline by company’s greater exposure to DIY in a slowing economy, and the large productivity gap to Home Depot (HD). (Jim Cramer’s Charitable Trust is long CTRA, DIS, MSFT, PG. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Reed Hastings, Co-CEO, Netflix speaks at the 2021 Milken Institute Global Conference in Beverly Hills, California, U.S. October 18, 2021.
David Swanson | Reuters

What I am looking at Wednesday, Oct. 19, 2022

  • NetflixDisney
  • The 2-year Treasury yield is 4.48%.
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