Tuesday Night's Show Highlights:
Halliburton is back, & they have finally shown a positive guidance tone! Consider HAL!
Tuesday, April 22, 2014
Cramer's comments: (prev. night's show posted each business morning before the market open)
Jim: If you want to know why this earnings season has started off so well, let me give you one word: earnings! Take Halliburton, the oil service titan, and one of my favorite ways to play the domestic oil and gas renaissance. I write about it in Get Rich Carefully. It's one of the companies that gets 55% of its business from the United States.
Just yesterday Halliburton reported, and the company totally knocked it out of the park. You might not have realized how amazing this quarter was merely by looking at the headline numbers though, as HAL beat the earnings estimates by a penny off 72-cent basis, with significantly higher-than-expected revenues, that rose 5.4% year over year. No. The real key here was the change in tone when it comes to Halliburton's North American guidance.
For the past few quarters, there had been too much capacity in some of HAL's main businesses, like pressure pumping. But now management sees that capacity tightening at a faster-than-expected rate. They're forecasting stronger activity, higher utilization, and greater service intensity in North America, among other areas, all of which should lead to higher revenues and wider margins in the future, hence how the company believes it can grow earnings per share at a 25% clip this year. The stock is up 62% over the last 12 months, yet HAL still sells for just 12.5x earnings, even after the stock rallied a quick $2...