Cramer's Morning Take: Amazon's Prime Day 7/11/23

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Jim Cramer (0:33)

Hey, it's Cramer, and this is my morning take on the market from today's CNBC Investing Club Morning Meeting. Once again, we've got a mixed market, but the cyclicals keep leaving us, Jeff.

Jeff Marks (0:44)

Yes, seeing another continuation of that rally, stocks like Caterpillar doing well, Emerson, Electric. On the other hand, it's the tech, it's NASDAQ lagging again. Some of that yesterday, perhaps due to that special rebalancing announcement in the NASDAQ 100

Of course, the Magnificent 7 became such outperformers, now they're trying to rebalance the index, so there's not an over-concentration problem.

Jim Cramer (1:11)

Right, but what's interesting is that Amazon, which is prime day, has gotten a couple of very positive pushes. And by the way, Salesforce, not a Magnificent 7, raises prices rather substantially for their product, and the stock is taking off.

Jeff Marks (1:24)

Yeah, I don't know which one we want to hit on first, but yeah, Amazon, prime day, of course. You have Wells Fargo adding it to a signature pick. You have Evercore naming it the Tactical Action and Positioning List. The analyst has been pushing that Triple Trough thesis, trough AWS revenue growth, trough retail margins and trading at a trough EBITDA multiple.

Jim Cramer (1:46)

Yeah, of course the problem is this thing. This is when it was trough.

Jeff Marks (1:50)

Right, it's been a nice move since he unveiled that thesis.

But big debate still around AWS re-acceleration. Some of the analysts today saying Q3, of course it could decelerate to a high single digits in Q2.

Jim Cramer (2:04)

25, 25 and the question is will it go below 10? I think it does.

Will it start up again? Not this quarter.

Stock has underperformed now for five years, which I thought was something that Carl pointed out that I didn't know.

Jeff Marks (2:17)

But there's the view that AI applications, AI added to AWS as well as this kind of the lapping effect because it was the third quarter last year is when we heard a lot of companies start talking about optimizing how much they were spending in the cloud. So perhaps one part you have the lapping of that effect and also AI reacceleration, maybe some macro themes as well.

Jim Cramer (2:41)

Well, look, I do think that we've held on to it.

I feel that the cost themselves, if they come out, will be terrific. If we do get some lift in Amazon ads, it'll be great. But if web services stays above 10%, then that's it. Stock's gonna go back.

Jeff Marks (2:58)

Come on, see some stabilization, double digits.

Jim Cramer (3:02)

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Morgan Brennan (3:59)

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