What Cramer is watching Thursday — Meta meltdown, Honeywell solid, Ford cash strong

Published Thu, Oct 27 20229:25 AM EDT

What I am looking at Thursday, Oct. 27, 2022 Money is coming out of tech to everything else. Dow futures up and Nasdaq futures down. Better-than-expected third-quarter GDP: 2.6% growth after two quarters of contractions. Some good news on the inflation front in the report. But more work for the Federal Reserve and the market hasn't budged from predicting a fourth straight meeting of a 75-basis-point interest rate hike. The Fed meets next week. Meta Platforms (META): I made a mistake, and I was wrong. I trusted this management team and that was ill-advised. Gone rogue. I got had. Horrifying free cash flow of less than $1 billion at the Club holding. Last year $9.5 billion. The hubris here is extraordinary. Bought back $6.5 billion of stock, suboptimal. Shares of the Facebook-parent getting crushed, down nearly 23% to around $100 in the premarket. As we wrote Wednesday evening after the mixed quarter and light guidance, it's no wonder the stock is down so much, with CEO Mark Zuckerberg obsessed with spending on the metaverse . Club holding Honeywell (HON): Margin expansion on productivity; margin expansion all four businesses. Aerospace 10% organic growth. Building tech up 19%. Operating margin up 90 basis points. Beat on quarterly earnings. Slight revenue miss. Guide full-year EPS $8.70 to $8.80 versus $8.65 expected. Shares up 4.5% in the premarket. Club holding Linde (LIN): Huge quarterly earnings beat. Margins muddled. Get out dodge, delist from the Frankfurt Stock Exchange. Maybe some near term selling if that happens but would be long-term positive as the industrial gas giant would no longer be subject to certain rules in the German market that lead to volatility. Club holding Ford (F): Can they hit fourth quarter? $50 billion in liquidity, resuming buyback. China big miss in third quarter. Beat on Q3 earnings per share and revenue ( preannounced in September ; stock crushed at the time). Raised full-year adjusted free cash flow goal to $9.5 billion to $10 billion, a $3.44 billion increase. Stock down 1.5% in the premarket. Dow stock Caterpillar (CAT): EPS in the third quarter $3.95 versus $3.18 expected. Sales of $14.99 billion also beat. Really strong. Operating margin 16.2% versus 13.4% expected. Profitable growth. Dow stock Merck (MRK): Another great quarter. Cancer drug Keytruda a driver. ServiceNow (NOW): Extraordinary. Stock up 16% in the premarket. Deflationary force. Yes, there is elongation but top of the funnel was excellent. Quarterly earnings beat. Slight sales miss. Southwest Airlines (LUV): EPS third quarter 50 cents versus 44 cents expected. Revenue per available seat mile up nice. Traffic up 7.2%. Good liquidity. MasterCard (MA): Consumer resilient, more focus travel emphasis. Payments and services very strong. Unilever (UL): Some good, some bad. Stanley Black & Decker (SWK): Good long term story. Working out. Moving to U.S. and Mexico. Carrier (CARR): Good number but some defeat based on parts missing. Will make numbers but in 2024. Norfolk (NSC): I like it. Nice growth-coal? Huge turn in coal, biggest grower. Volume up 14%; price up 25%. (Jim Cramer's Charitable Trust is long META, F, HON and LIN. 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.

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What I am looking at Thursday, Oct. 27, 2022

Money is coming out of tech to everything else. Dow futures up and Nasdaq futures down. Better-than-expected third-quarter GDP: 2.6% growth after two quarters of contractions. Some good news on the inflation front in the report. But more work for the Federal Reserve and the market hasn't budged from predicting a fourth straight meeting of a 75-basis-point interest rate hike. The Fed meets next week.
Meta Platforms (META): I made a mistake, and I was wrong. I trusted this management team and that was ill-advised. Gone rogue. I got had. Horrifying free cash flow of less than $1 billion at the Club holding. Last year $9.5 billion. The hubris here is extraordinary. Bought back $6.5 billion of stock, suboptimal. Shares of the Facebook-parent getting crushed, down nearly 23% to around $100 in the premarket. As we wrote Wednesday evening after the mixed quarter and light guidance, it's no wonder the stock is down so much, with CEO Mark Zuckerberg obsessed with spending on the metaverse.