CNBC Investing Club

What Cramer is watching Friday — Investors are over companies that beat the Street but lose money

People walk along Wall Street near the New York Stock Exchange on March 08, 2022 in New York City.
Spencer Platt | Getty Images

What I am looking at May 6, 2022

  • The end of "beat and raise" losses. That's what (BILL) and HubSpot (HUBS) have said. The change in the investor sentiment is this: If you are not profitable and you beat and raise, it doesn't mean anything anymore. New way to value these stocks is to go back to January 3, 2020, then go to November when the Fed pivoted, and then go to now. Watch market-cap size to see if back near that January 2020 level. Most of these names are still too big to be bought by another company.
  • Shares of HubSpot, a cloud-based marketing and sales platform, might have gone up on this quarter but it got crushed. $15 billion market cap. RBC cuts price target to $750 from $925, but the stock is at $341. HUBS reported first-quarter EPS of 58 cents, estimate was 47 cents. Management says 2022 earnings per share in $2.40 to $2.42 range, versus consensus $2.41. Stock aas at $850 when Fed changed view in November.
  • Cloud-based payments platform reported a loss of 8 cents when the Street was looking for loss of 16 cents. Very expensive product. Yet Piper Sandler cuts price target to $300 from $380 — but currently at $120. Management forecast loss of 13-to-14 cents next quarter versus consensus loss of 15 cents. Company expects full-year loss of 34-to-35 cents, yet Street was looking for 46 cent loss. Shares traded at $337 in November.