The stock market’s current run could fizzle out if October retail sales data comes in hot next week, CNBC’s Jim Cramer warned on Friday.
“If we see weak retail sales and learn that things are getting very promotional in the key apparel sector, well then the market can stay strong,” he said, adding: “The worse retail gets, the less damage the Fed needs to do before they declare victory.”
Stocks rose on Friday following lighter-than-expected October consumer price index data released the day prior that raised investors’ hopes the Federal Reserve will slow its pace of interest rate hikes. The benchmark S&P 500 ended its best week since June.
Earnings reports from the country’s biggest retailers take center stage next week, as do retail sales data for October.
“While I want retail stocks to do well, oddly I have to root for a weak number [from the October report] with little inflation in order to make that happen,” Cramer said.
He also previewed next week’s slate of earnings. All earnings and revenue estimates are courtesy of FactSet.
Tuesday: Walmart, Home Depot
Walmart
- Q3 2023 earnings release at 7 a.m. ET; conference call at 8 a.m. ET
- Projected EPS: $1.32
- Projected revenue: $147.67 billion
Cramer said the economy is soft enough that shoppers are starting to trade down, which is good news for Walmart.
Home Depot
- Q3 2022 earnings release at 6 a.m. ET; conference call at 9 a.m. ET
- Projected EPS: $4.12
- Projected revenue: $37.94 billion
Wednesday: Lowe’s, TJX, Target, Nvidia
Lowe’s
- Q3 2022 earnings release at 6 a.m. ET; conference call at 9 a.m. ET
- Projected EPS: $3.09
- Projected revenue: $23.14 billion
Cramer said that Lowe’s and Home Depot are likely winning due to home renovations, but he doesn’t expect either company’s quarters to knock it out of the park.
TJX
- Q3 2023 earnings release at 9:30 a.m. ET; conference call at 11 a.m. ET
- Projected EPS: 80 cents
- Projected revenue; $12.30 billion
TJX stock is the “best of the best for this particular moment,” he said.
Target
- Q3 2022 earnings release at 6:30 a.m. ET; conference call at 8 a.m. ET
- Projected EPS: $2.16
- Projected revenue: $26.41 billion
He said he’s a believer in Target.
Nvidia
- Q3 2023 earnings release at 3:20 p.m. ET; conference call at 5 p.m. ET
- Projected EPS: 71 cents
- Projected revenue: $5.8 billion
Cramer said he’s worried that semiconductor players are experiencing a short-covering rally rather than a sustainable one.
Thursday: Kohl’s, Gap, Palo Alto Networks
Kohl’s
- Q3 2022 earnings release at 7 a.m. ET; conference call at 9 a.m. ET
- Preliminary EPS: 82 cents
- Preliminary revenue: $4.05 billion
Gap
- Q3 2022 earnings release at 4:15 p.m. ET; conference call at 5 p.m. ET
- Projected EPS: $0
- Projected revenue: $3.81 billion
Cramer said that he’s uninterested in both Kohl’s and Gap’s stocks.
Palo Alto Networks
- Q1 2023 earnings release at 4:05 p.m. ET; conference call at 4:30 p.m. ET
- Projected EPS: 69 cents
- Projected revenue: $1.55 billion
He said he recommends buying the stock if it dips before the earnings release.
Friday: Foot Locker
- Q3 2022 earnings release at 6:45 a.m. ET; conference call at 9 a.m. ET
- Projected EPS: $1.14
- Projected revenue: $2.10 billion
Cramer said he’s betting CEO Mary Dillon has a plan to improve Foot Locker’s performance.
Disclaimer: Cramer’s Charitable Trust owns shares of TJX and Nvidia.
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