Cramer's Morning Take: Netflix & Tesla 7/20/23

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Jim Cramer (0:09)

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Jeff Marks (0:11)

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Jim Cramer (0:34)

Jim Cramer here to share with you a sample of my take on the market from today's CNBC Investing Club morning meeting.

You know what they're saying, Jeff? That you keep hearing about this broadening out, going back to the mighty Dalles we like to joke about and getting away from Big Cap Tech. Now, look, I want to make a point here. Big Cap Tech has had just a giant move, so I just think that's totally, I think that's understandable.

But what I thought was very interesting about the Dow is drug stocks up, and we can talk about J&J, IBM up, which is a company that is chronically undervalued if you think they really have a good cloud strategy, and chips a little bit weaker because Taiwan Semi did say that, frankly, that the CPU is kind of finished. China's in trouble. Very interesting call.

Jeff Marks (1:20)

And we had some big earnings reports last night, Netflix, Tesla, seeing some selling in both. Both were, I think, generally considered good reports, but perhaps some sell the news after such big runs that the group has had. Money rotating into other areas, by the way. There's a rebalancing coming up soon.

Tesla, Netflix not really affected, but Tesla is one of the news of the week.

Jim Cramer (1:41)

Yeah, and I just want to say in Netflix, these are not our stocks, candidly. Netflix, the banking on the customer who's going to take the ad tiers, the key way to look at that, because the ad tier customer is worth a lot more than the customer who doesn't take the ads.

And on Tesla, you have to understand that he's in it to win it big time. He's not in it for the quarter, and anyone who's ever sold or bought it for the quarter, it's been stupid, it's been wrong to do.

Jeff Marks (2:07)

Which, by the way, the ad tier, Disney trying to build that out, right, coming to Europe, I believe, later this year, but they're just behind. They're behind Netflix.

Jim Cramer (2:17)

But Disney has to, Bob Iger, Memo to Bob Iger, go listen to Netflix, call me. Now those guys, just so you know, both companies are not promotional.

And Netflix was this kind of very odd, free-flowing discussion among really serious practitioners of the game. It was not about buying the stock. They don't do that.

Jeff Marks (2:34)

Meanwhile, Jim, the S&P oscillator, which we always closely follow, back to overbought, above 5%. 4% threshold is when it's overbought, but over 5% is when I know you get a little bit more cautious.

Jim Cramer (2:45)

Right, and this is why, now you usually shouldn't anticipate the oscillator, and we do have a deal for people who want to take the oscillator, but I'm always worried about plus 5 The reason I'm worried about plus 5, plus 5 to plus 7, is when you get very excited, and you feel like, jeez, this is really terrific. But then look at what happened with Netflix, and look what happened with Tesla. You get vulnerable, okay? And I don't want our viewers to be, our club members to be vulnerable. I want them to be ready.

I want them to be able to look at a downturn and say, good, not bad. And that is what a real good pro does, is says, oh, here's my downturn.

Jeff Marks (3:17)

And I think that was the point you were making earlier today, that people are going to come back to some of these winners this year as they pull back.

Jim Cramer (3:23)

Yes.

Jeff Marks (3:23)

That's the opportunity perhaps to get.

Jim Cramer (3:25)

I mean, look, I'm not going to recommend Tesla here, but I'm going to tell you that Tesla over a couple of days is going to be able to go back to it. And same way they went back to Adobe, which is a tremendous company. It's doing great generative AI. But same way they came back to ServiceNow, which I think is going to have a monster quarter when they report next week. Monster.

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