First up in the Game Plan for next week is retail. Remember a couple of weeks ago when Cramer did his “Benefit of the Doubt” series on retail CEOs he thought you could trust if they reported one bad number? (You can read about it here, here, here and here.) Well, three of the nine stocks are up 3% to 4%, and Polo Ralph Lauren is up 7%. Saks and Federated Department Stores, though, are down a percent and a half because the Street was unhappy with their latest reports. Cramer says to use this as your entry point. He trusts the CEOs of those companies to deliver the next time around.
Now the earnings plays. Steel Dynamics reports Monday. Cramer says it’s a likely acquisition target, so he’d use the quarter as an opportunity to get in if the stock dips below $44.50.
Then on Tuesday, Coke reports. Cramer’s predicting a break-out quarter. Coke is the quintessential weak-dollar play. The company takes in huge sales in foreign currency and then converts it to dollars as the foreign cash appreciates relative to the dollar. Cramer would be willing to pay up to $50.85 for KO.
A number of regional banks report on Tuesday as well, namely Wells Fargo and Washington Mutual. There’s too much mortgage exposure here for Cramer’s tastes, so he recommends buying some Annaly Capital Management instead.
Both United Technologies and eBay release numbers on Wednesday. Cramer’s bullish on both. UTX is a gift below $65, he says, and eBay is a great value play.
Quest Diagnostics, Harley-Davidson and American Standard all report on Thursday. The American Standard CEO recently sold some stock, but don’t let that scare you. This is the last quarter before the company breaks up, and Cramer thinks it’s a great chance to buy. Steer clear of HOG, though. Cramer says the Indiana kids called it when he was in Bloomington last week: too much inventory. Jim’s charitable trust owns DGX, and because of the speculation that the company could be bought out, he recommends you consider it, too.
If Merck is a blow out, and Cramer thinks it will be, then Schering-Plough should go to $30, he says. SGP reports Thursday as well. So does Intuitive Surgical. Cramer’s also expecting a blow out quarter with this company.
Finally, Schlumberger is worth a look if the stock goes below $75 because Cramer’s prediction is for a monster quarter. If there is a bit of weakness, he would be a buyer of SLB for a trade up to $80.
Bottom Line: There’s a lot of action next week, a lot of earnings plays. Don’t forget Cramer’s "Benefit of the Doubt" names, Federated and Saks, which should be bought on their current weakness.
Cramer's charitable trust owns Quest Diagnostics.
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