The air has been slowly escaping the stock market balloon for weeks now, Jim Cramer told his Mad Money viewers Friday. And unless you own the stock of a company that makes real things and has real earnings, expect a lot more pain ahead.
For months now, we've had an onslaught of worthless IPOs and SPACs hitting the market, and now it's time for those chickens to come home to roost.
Cramer's game plan for next week starts on Monday with the earnings from Halliburton (HAL) and IBM (IBM). He called Halliburton a "must listen" conference call, as they will tell us if oil drillers are ramping up production to curb prices. IBM will likely have a convoluted quarter as it transitions to newer technologies.
Next, on Tuesday, we'll hear from General Electric (GE) and Johnson & Johnson (JNJ), but Cramer said there's no hurry to buy either. He was bullish on American Express (AXP) with the return of travel, and Microsoft (MSFT).
Wednesday brings what should be good earnings from Tesla (TSLA), but Cramer said he's expecting nothing from Boeing (BA), which is a good thing, since that won't be able to disappoint him.
Thursday will include earnings from two Cramer favs, McDonald's (MCD) and Apple (AAPL).
Finally on Friday, Cramer said Chevron (CVX) is a buy, but Caterpillar (CAT) isn't likely to surprise us.
Executive Decision: Huntington Bancshares
In his first "Executive Decision" segment, Cramer spoke with Steve Steinour, chairman, president and CEO of Huntington Bancshares (HBAN), the Ohio-based bank that just released better-than-expected earnings but with weaker revenues that sent shares down 9% by the close.
Steinour commented on Friday's announcement that semiconductor maker Intel (INTC) will invest $20 billion to bring chip manufacturing to Huntington's hometown of Columbus, Ohio. He said the deal came together very quickly and will have "seismic" impacts on the Ohio economy. Intel's first factory will be one million square feet and represent the biggest chip plant in the world.
Steinour added that Columbus, and all of Ohio, brings together everything Intel needs, from good schools, and a talented workforce, to cheap energy and the perfect geography to power America's semiconductor needs for decades to come.
Turning to business at Huntington, Steinour said that his bank has a great deposit base and rising interest rates will only add to their profitability. He was also encouraged by falling Covid hospitalization rates in their area, which may finally be signaling that the pandemic is winding down.
Off the Charts
In the "Off The Charts" segment, Cramer checked in with colleague Mark Sebastian for the latest read on the CBOE Volatility Index, known by its ticker, the (VIX) .
Sebastian explained that there are typically two kinds of rises in the VIX, a spike and a surge. A spike typically accompanies a short-term selloff in stocks, which quickly rebounds. A surge in the VIX however, is a slow-moving rise that signals a bearish correction that can last weeks or months.
Unlike many short-term spikes in the past, Sebastian felt the current move is more of a surge. Since the market top on Jan. 3, the VIX has been slowly rising as the market sold off, signaling more weakness ahead. Sebastian felt the selling could continue, possibly for weeks.
Cramer noted that Sebastian's analysis is exactly why he's been preaching to only buy the stocks of real companies with real earnings. A VIX swell is no time to speculate on high-multiple companies with no earnings.
Cramer Does His Homework
In his "Homework" segment, Cramer followed up on a few stocks that stumped him during earlier shows. He said that Nautilus Biotechnology (NAUT) has been a typical SPAC, which exploded on its IPO, only to fall to just $4 a share since.
Nautilus is a very early stage biotech that is developing a platform to study the human proteome in the hopes of helping usher in the age of personalized treatments for many diseases, including cancer. The only problem? We don't yet know if we have the technology to study the human proteome. Cramer said he has no strong feelings either way with this speculative startup.
Next up was Cyxtera (CYXT) , a data center company that Cramer was also not very excited about. He said Cyxtera has all the hallmarks of a private equity-backed IPO, including a mountain of debt and lockup periods for insiders that are likely to crush individual investors. He was not a fan, preferring Digital Realty Trust (DLR) instead.
Lightning Round
In the Lightning Round, Cramer was bullish on AT&T (T), InMode (INMD) and Carrier Global (CARR).
Cramer was bearish on GrowGeneration (GRWG), GoodRX (GDRX) and H&R Block (HRB).
The Netflix Pullback
In his "No Huddle Offense" segment, Cramer commented on Friday's 22% plunge in Netflix (NFLX), something he's been predicting would eventually come.
For years now, Netflix has told investors that their biggest competition was time. The spell was finally broken as Netflix admitted there's simply too much to watch and not enough time to watch it. The competition has gotten too great, which greatly caps their future earnings potential.
But Cramer urged that the problems at Netflix don't necessarily translate to rivals like Walt Disney (DIS), which plunged 6.9% in sympathy with Netflix. Disney still has a lot going for it, Cramer concluded, and he would be a buyer on continued weakness.
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