Energy
Tuesday, August 2nd, 2022 9:46 am EDT
Every weekday the CNBC Investing Club with Jim Cramer holds a “Morning Meeting” livestream at 10:20 a.m. ET. Here’s a recap of Tuesday’s key moments. AMD is ahead of Intel We’re not going to sell winners to fund losers Quick mentions: CTRA, PTX 1. AMD is ahead of Intel We are optimistic about Advanced Micro Devices (AMD), which reports its second-quarter earnings after the bell on Tuesday. Wall Street expects earnings per share of $1.03, and revenue to come in at $6.53 billion. While Intel ‘s recent poor quarter has investors worried about AMD, it’s important to note that the company led by CEO Lisa Su has a much different pie . AMD is not overly reliant on personal computers, and while gaming remains a vulnerable segment, the company’s acquisition of semiconductor firm Xilinx this year means that gaming is becoming a smaller part of its business. It’s also worth noting that AMD will use a new reporting structure for its quarterly results that includes four segments instead of two: data center, embedded, client and gaming. This new structure will help us better understand the growth in AMD’s data center business, which should be aided by its Xilinx acquisition. 2. We’re not going to sell winners to fund losers One of the Club’s trading mantras is we’re not selling winners to fund losers. With that in mind, here are some quick takes on some of the winning and losing companies in our portfolio. We believe that Cisco (CSCO) is problematic and have concerns that the stock won’t recover, especially as it gets overshadowed by competitors’ more successful quarterly results and its past supply sourcing struggles. We sold some shares of Cisco and downgraded our rating to a 2. Investors might be worried about Constellation Brands (STZ) after Molson Coors Beverage (TAP) reported a split emerging in consumer spending on beer in its most recent quarterly earnings. However, we believe that the beer season isn’t weak — it was just weak for Molson Coors. In other words, we believe that Constellation’s performance will be unaffected. And with the company’s possible elimination of Class B stock, we expect that the company will be more disciplined with its capital allocation, and perhaps issue larger dividends and stock buybacks in the future. 3. Quick mentions: CTRA, PXD Coterra Energy (CTRA) and Pioneer Natural Resources (PXD) are set to report earnings after the closing bell Tuesday, one day after Devon Energy (DVN) crushed its quarterly numbers. Energy stocks have been under pressure recently due to the pullback in oil prices. But we believe Pioneer should be on the radar for income-seeking investors because of its S & P 500 leading dividend yield. “We recognize that this is a profit-taking moment, and no more than that, because interest rates are going lower, oil’s stable and inflation seems for the moment under control,” Cramer said. (Jim Cramer’s Charitable Trust is long AMD, CSCO, CTRA, DVN, PXD. 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. This post has been syndicated from a third-party source. View the original article here.
