Cramer has been insistent for some time now that tech stocks are where he thinks you need to be in this market. One name that he has pounded the table on consistently is Hewlett-Packard , which reported blowout numbers last month and delivered a serious upside surprise that Cramer had been calling for.
Sometimes companies will report an upside surprise by just sandbagging the Street with low-ball estimates and then beating them, but Hewlett made a legitimate five cent beat off of an expectation that the company would do 66 cents per share in earnings. How did it do it? HP’s suppliers were all involved in big price wars which lowered HP’s costs – but HP managed to keep from lowering its prices on its own goods, which is exactly how you get such an upside swing, Cramer said.