3 takeaways from the Investing Club’s ‘Morning Meeting’ on Wednesday
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 Wednesday’s key moments. Oil is all about Russia Quick mentions: AMD, F Eli Lilly reports Thursday 1. Oil is all about Russia U.S. oil prices, as measured by West Texas Intermediate crude futures , dropped another 3% on Wednesday, nearing the $90-per-barrel level. WTI hit 13-year highs in March, trading above $130 per barrel, after Russia invaded Ukraine. Despite the recent declines, we are still keen on our oil stocks as they are returning tons of excess cash to shareholders. Club holding Pioneer Natural Resources (PXD) reported a great quarter after the closing bell Tuesday. Pioneer’s 15% annualized dividend yield is the leader in the S & P 500, and it plans to return over a whopping 95% of its second-quarter free cash flow to shareholders via dividends and buybacks. As for Coterra Energy (CTRA), it’s a big natural gas play, and the U.S. has enough natural gas to send to Europe. We believe that the Club holding is likely to hold up, especially if Germany, which is facing a gas emergency due to Russia’s war, has a cold winter. The company, after-the-bell Tuesday, announced a strong quarter and increased its quarterly dividend and pace of stock buybacks. While we believe these companies are well-positioned to generate cash, we acknowledge that technical market analysis suggests that oil will go down to $80 per barrel and hurt their bottom lines. However, we maintain the biggest driver of oil prices is ultimately Russia and its production levels. 2. Quick mentions: AMD, F Advanced Micro Devices (AMD) reported after the closing bell on Tuesday, and CEO Lisa Su is slated for an appearance on “Mad Money” on Wednesday evening. The company beat Wall Street expectations with its second quarter results. We believe there are bullish signs for the stock, including the significant growth in its data center business and its path forward on taking share from Intel (INTC). Ford (F) has a long waitlist for many of its models, with almost all 2022-model year vehicles sold out. The company also boosted its quarterly dividend by 50% to 15 cents per share. The stock rose Wednesday on strong July sales figures, up 36.6% from the year-ago period and 7.7% over June. Industrywide July sales were estimated to have declined by 10.5% 3. Eli Lilly reports Thursday Eli Lilly (LLY) reports earnings before the bell Thursday, and part of our focus will be on the launch of Mounjaro, the company’s Type-2 Diabetes drug that’s also in trials as an obesity treatment. While we rarely advise buying ahead of a quarter, we like the long-term view and would consider buying back some of the shares we recently sold higher if the stock pulls back further. (Jim Cramer’s Charitable Trust is long AMD, CTRA, DVN, F, LLY, and 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.
