Homepage / Technology / Cramer Remix: The prospect of stock buybacks should calm fears of a major market decline
Amazon says this Prime Day was its biggest shopping event ever Kudlow says President Trump is 'so dissatisfied' with China trade talks that he is keeping the pressure on As stocks regain their footing, an ominous warning looms Goldman Sachs downgrades Clorox to sell, says valuation is 'unsustainably high' How Satya Nadella has spurred a tripling of Microsoft's stock price in just over four years Kudlow says economic growth could top 4% for 'a quarter or two,' more tax cuts could be coming The one chart that explains Netflix’s stunning comeback US housing starts plunge 12% in June to a nine-month low Aerospace titans Boeing and Airbus top $110 billion in orders at Farnborough Target uses Prime Day to its advantage, logging its 'biggest online shopping day' so far this year Billionaire Marc Lasry sees bitcoin reaching up to $40,000 as it becomes more mainstream and easier to trade These are the 10 US airports where you're most likely to be hacked Amazon shares slightly higher as investors await Prime Day results Wreck of Russian warship found, believed to hold gold worth $130 billion A bullish ‘phenomenon’ in bond market is weeks away from fading, top credit strategist says Stocks making the biggest moves premarket: MS, GOOGL, TXN, UAL, NFLX & more Twitter shares up 50% since late April means most upside priced in, analyst says in downgrade EU fines Google $5 billion over Android antitrust abuse Mortgage applications fall 2.5% as buyers struggle to find affordable homes America may not have the tools to counter the next financial crisis, warn Bernanke, Geithner and Paulson Investors are getting spooked as the risk of a no-deal Brexit rises EU expected to fine Google $5 billion over Android antitrust abuse Ex-FBI chief James Comey urges Americans to vote for Democrats in midterm elections Elon Musk apologizes to British cave diver following baseless 'pedo guy' claim Disney, Comcast and Fox: All you need to know about one of the biggest media battles ever Xiaomi shares notch new high after Hong Kong, mainland China stock exchanges reach agreement The trade war is complicating China's efforts to fix its economy European markets set for a strong open amid earnings; Google in focus Hedge fund billionaire Einhorn places sixth in major poker tournament The biggest spender of political ads on Facebook? President Trump Asian stocks poised to gain after Fed's Powell gives upbeat comments; dollar firmer Stocks are setting up to break to new highs Not all FAANG stocks are created equal EU ruling may be too little, too late to stop Google's mobile dominance Cramer explains how Netflix's stock managed to taper its drop after disappointing on earnings Airbnb condemns New York City's 'bellhop politics,' threatens legal retaliation Amazon sellers say they were unfairly suspended right before Prime Day, and now have two bad choices Investor explains why 'duller' tech stocks can have better returns than 'high-flying' tech names Elon Musk is 'thin-skinned and short-tempered,' says tech VC Texas Instruments CEO Brian Crutcher resigns for violating code of conduct Google Cloud Platform fixes issues that took down Spotify, Snapchat and other popular sites Uber exec: We want to become the 'one stop' transportation app 'What a dumb hearing,' says Democrat as Congress grills tech companies on conservative bias Amazon shares rebound, report says Prime Day sales jumped 89 percent in first 12 hours of the event How to put your medical history on your iPhone in less than 5 minutes Investment chief: Watch these two big events in 2018 Even with Netflix slowing, the market rally is likely not over Cramer: Netflix subscriber weakness debunks the 'sky's the limit' theory on the stock Netflix is looking at watch time as a new area of growth, but the competition is stiff Why Nobel laureate Richard Thaler follows Warren Buffett's advice to avoid bitcoin Rolls-Royce is developing tiny 'cockroach' robots to crawl in and fix airplane engines After Netflix plunge, Wall Street analysts forecast just tame returns ahead for the once high-flying FANG group Roku shares rise after analyst raises streaming video company's price target due to customer growth China is investing 9 times more into Europe than into North America, report reveals Amazon says US Prime Day sales 'so far bigger than ever' as glitch is resolved Netflix is on pace for its worst day in two years US lumber producers see huge opportunity, rush to expand San Francisco to consider tax on companies to help homeless Homebuilder sentiment, still high, stalls as tariffs, labor and land drive up costs Powell backs more rate hikes as economy growing 'considerably stronger' Netflix history is filled with big stock declines – like today – followed by bigger rebounds Intel shares get downgraded by Evercore ISI due to rising competition from Nvidia, AMD Petco aims to reinvent the pet store with something you can't buy online Genetic testing is coming of age, but for consumers it's buyer beware Tech 'FAANG' was the most-crowded trade in the world heading into the Netflix implosion, survey shows Netflix weak subscriber growth may indicate a 'maturity wall' that could whack the stock even more: Analyst This chart may be predicting the bull market's demise Wall Street says Netflix's stock plunge is a ‘compelling’ buying opportunity because the streaming giant ‘never misses twice’ Tesla sinks after Musk tweets, again Boeing announces new division devoted to flying taxis Stocks making the biggest move premarket: NFLX, UNH, GS, AMZN, WMT & more Deutsche Bank downgrades Netflix, but says big subscriber miss is not 'thesis changing' IBM is experimenting with a cryptocurrency that’s pegged to the US dollar North Korea and Zimbabwe: A friendship explained Virgin Galactic spinoff Orbit to launch rockets from the UK with space deal Artificial intelligence will create more jobs than it destroys? That’s what PwC says ‘Treasonous’ Trump and ‘Putin’s poodle:' Scathing headlines follow the Trump-Putin summit China’s fintech companies offer ‘enormous’ opportunity, investment manager says Trump's performance at summit with Putin was 'unprecedented,' experts say Walmart and Microsoft link up on cloud technology as they both battle Amazon European stocks seen mixed amid earnings; Fed’s Powell to address Congress How I knew I should quit my day job and run my start-up full-time: Viral website founder China's stocks have been trounced, but the trade war may ultimately be good news for those shares Billionaire tech investor Peter Thiel bets on crypto start-up Block.one Asian shares subdued open after mixed close on Wall Street; energy stocks under pressure Amazon cloud hits snags after Amazon Prime Day downtime Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis Tech stocks set to sink on Tuesday after rough evening for ‘FANG’ Netflix plummets after missing big on subscriber growth This wristband lets humans control machines with their minds The U.S. has a rocky history convincing Russia to extradite computer criminals Amazon suffers glitches at the start of Prime Day Jeff Bezos is now the richest man in modern history 'The United States has been foolish': Read Trump and Putin's full exchange Goldman Sachs recommends these 5 highly profitable companies — including Nvidia — to combat rising inflation Goldman Sachs releases 'tactical' stock picks for this earnings season Three red flags for Netflix ahead of its earnings report The bond market may be raising recession fears, but don't expect one anytime soon Cramer: Banks are 'making fortunes' but are still as hated as they were during the financial crisis Putin told Trump at summit: Russia never meddled in US election

Technology

Cramer Remix: The prospect of stock buybacks should calm fears of a major market decline

The worst intra-day market reversal in nearly a year might’ve spooked investors, but CNBC’s Jim Cramer argued that the market still has a major driver in its metaphorical back pocket.

“I’m talking about the ongoing stock shortage,” the “Mad Money” host said. “The shortage is so real, so palpable, that I think it could become a major theme as earnings season progresses.”

Why? Cramer pointed to the trend of share repurchases, or stock buybacks, emerging among major companies like J.P. Morgan and Citigroup.

As they buy back millions, if not billions, of their shares, their supply of stock grows tighter — hence the shortage — and their shareholders usually benefit.

“The only way to offset the stock shortage? Well, we’d need to see some gigantic IPOs for companies like Airbnb or Uber or Spotify, or something like that trillion-dollar Saudi Aramco deal that will definitely sop up some cash,” Cramer said. “Still, even if we get a wave of new deals here in America, it will be a drop in the bucket compared to the pace of these buybacks. The stock shortage, it’s the greatest story never told.”

Even after Tuesday’s massive stock market reversal — the biggest in roughly 10 months — Cramer maintained that he liked the market.

But the “Mad Money” host acknowledged that there are “rules of engagement for dealing with a bull market that’s in beast mode,” so he wanted to highlight those for investors.

Cramer’s No. 1 rule is one of his most common sayings: no one ever got hurt taking a profit.

In a rallying market like this one, investors tend to forget that their gains aren’t really winnings until they ring the register. That can burn them when the market takes a hit.

Of all the major conferences that kicked off 2018 — from the ICR confab to the tech-laden CES — the J.P. Morgan Healthcare Conference was the most important for Cramer.

“This meeting tends to make major waves in the health care stocks,” he said. “The problem is the announcements from these pharma and biotech companies often read like they’re written in hieroglyphics. It can be very difficult to understand this stuff without a medical degree or a PhD in chemistry.”

So, to help investors make sense of what often proves to be a groundbreaking event, Cramer went through the biggest winners and losers from J.P. Morgan’s San Francisco, California-based health care convention.

As the bank- and health-care-led market rally pushed the Dow Jones industrial average above the 26,000 level for the first time ever, Cramer wanted to check in with tech.

“You always need to be thinking about when it might be time to do a little register-ringing,” Cramer said. “I don’t want to scare you away from stocks. Just the opposite — like I said, I like stocks. But if you’re going to be a responsible investor, you need to be at least considerate of whether it’s a good idea to maybe be a little cautious.”

The stocks of Amazon, Alphabet, Netflix and Nvidia all made 52-week highs on Tuesday amid the surge, so Cramer enlisted technician Carolyn Boroden to determine if it was time for investors to take some profits off the table.

Boroden, the brain behind FibonacciQueen.com and Cramer’s colleague at RealMoney.com, said that with the four stocks nearing her price targets, now is the time to get careful.

Stock market rallies tend to feed on themselves, and Cramer sees few places where that tendency is better exemplified than in the stock of aircraft manufacturer Boeing.

As the Dow’s best 2017 performer continues its flight higher, analysts from nearly every key Wall Street research firm have been falling over themselves to up their estimates and price targets for its stock.

“I don’t want to make it sound like these guys are just mindlessly chasing a stock because it’s roaring here. They’re absolutely right to like Boeing and absolutely right to recommend it. When you factor in the impact of tax reform, this company’s going to be practically overflowing with cash,” Cramer said.

But the “Mad Money” host also noticed that the relationship has become somewhat symbiotic. Analysts upgrade the stock; the stock subsequently goes higher.

“As long as there are stories like Boeing where the analysts are desperate to raise their price targets and push the stock higher, … I think you’ve got a nice cushion that allows you to pick up these stocks into any weakness, even intraday,” Cramer said. “The analysts are like a coiled spring, giving you still one more reason to buy the stock of Boeing whenever you’re lucky enough – and I mean that, lucky enough – to get a dip.”

In Cramer’s lightning round, he rattled off his take on some callers’ favorite stocks:

STMicroelectronics: “I like that stock very much. Now, let’s remember, that group has gotten hot again and we’re starting to circle back. We want to be careful because ASML, [which] reports later this week, could impact that stock.”

Universal Display: “We’re having pullbacks in these high-multiple, high-growth stocks, so now you have to wait for the pullback in OLED. It’s had a big move. We can wait for a pullback. We do not need to just plunge in. There’s nothing today that is moving it.”

Disclosure: Cramer’s charitable trust owns shares of J.P. Morgan, Citigroup, Alphabet and Nvidia.

Questions for Cramer?
Call Cramer: 1-800-743-CNBC

Want to take a deep dive into Cramer’s world? Hit him up!
Mad Money TwitterJim Cramer TwitterFacebookInstagramVine

Questions, comments, suggestions for the “Mad Money” website? madcap@cnbc.com

Source: Tech CNBC
Cramer Remix: The prospect of stock buybacks should calm fears of a major market decline

Comments are closed.