Another earning season is over. The winners? Most of our stocks. Twenty-three out of 33 portfolio names delivered third-quarter reports were deemed good or great by the Investing Club, thanks partly to a still-strong consumer and largely to the massive build out of all things AI. Case in point: In the S & P 500, 86% of technology companies beat sales estimates for the third quarter, according to FactSet data. That was followed by healthcare (79%) and real estate (74%). Communication services led all sectors for bottom-line beats, with 95%, followed by technology, at 86%. Two big moves to note. We initiated a position in Goldman Sachs after the financial name reported third-quarter results — we obviously liked what we saw on the release and heard from management — so it isn’t included in this report. Also excluded is Advanced Micro Devices , which we exited Dec. 31 after the chipmaker reported lackluster results and gave little reason to stick with it into the new year. As always, we’re wrapping up the season with a review of results for all Club holdings. These quarterly report cards are not the end-all, be-all for analysis. However, we believe stock prices ultimately follow the underlying business fundamentals of companies and having an idea of which companies did well and which didn’t can help with buying and selling decisions. Similar to prior quarters, we grouped company results into one of four categories. The companies in each category are listed in alphabetical order. The Great The Good The Not So Bad The Ugly The Great Alphabet “Listening to the post-earnings conference call made one thing abundantly clear: Artificial intelligence is being woven into every aspect of this company and, in turn, driving more engagement from both consumers and enterprise customers alike. It’s not just revenue that AI is helping to grow, it’s also helping the company become more efficient than ever.” — Oct. 29 after the bell Amazon “[The company] reported a much better-than-expected third quarter Thursday, with strong growth across online sales, its cloud business and advertising. Margin initiatives lead to soaring profits. Additionally, the fourth-quarter forecast was exactly what was needed to keep investors happy.” — Oct. 31 after the bell (Amazon is a core holding in the Club’s portfolio; one of 12 stocks with this designation.) Broadcom “The headline numbers for the August-to-October quarter may have been mixed, but make no mistake, this was a very strong report. You wouldn’t understand just how strong, though, unless you listened to the earnings call. It is the latest example to support Jim Cramer’s long-held investing principle that investors need to wait for the call before making a post-earnings trade.” — Dec. 12 after the bell (We exited Advanced Micro Devices on Dec. 31 because companies want custom AI chips from Broadcom and others if they can’t get Nvidia.) BlackRock “The firm posted third-quarter earnings that crushed analysts’ expectations, yet again. Management also announced that assets under management reached another record high, an incredible $11.5 trillion, on surging inflows as the stock market rallied.” — Oct. 11 before the bell (The Club called up the world’s largest asset manager from the Bullpen and started a position on Oct. 16 .) Costco “Costco shares are not cheap by traditional standards, trading at around 54 times next-12-months EPS estimates. The lofty valuation, however, hasn’t stopped the stock’s monstrous rise over the years. The stock is deserving of its hefty premium due to the company’s share gains and dependability with a subscription model.” — Dec. 12 after the bell (Costco is a core Club holding.) Disney “It was a great quarter. Sales and earnings beat. The company generated strong cash flow. And perhaps most importantly for investors, its direct-to-consumer streaming unit’s profitability was well ahead of the consensus estimate. And the good run should continue, with management forecasting earnings growth acceleration over the next couple of years.” — Nov. 14 before the bell Meta Platforms “[The company] delivered one heck of a strong third quarter and a current quarter revenue guide above expectations. … Fewer-than-expected daily active users in the quarter and bump higher in full-year capital expenditures guidance [were not concerning],” — Oct. 30 after the bell (Meta is a core Club holding .) Morgan Stanley “This was as clean a quarter as anyone could have asked for. Morgan Stanley outpaced expectations in just about every aspect of each operating division and put up very strong quarterly results in terms of firmwide key performance indicators.” — Oct. 16 before the bell (Despite the strong quarter, the Club sold half of its Morgan Stanley position on Dec. 19 and initiated a position in Goldman Sachs. In the trade alert, we wrote, “We plan to use our remaining Morgan Stanley shares as a source of funds to scale deeper into Goldman Sachs .”) Nvidia “Nvidia reported a fantastic quarter … even if guidance for the current quarter came up a bit short of the loftiest expectations. … It’s hard to complain about a beat-and-raise quarter just because the beat and raise wasn’t as big as some craved.” — Nov. 20 after the bell (Nvidia is one of two “own it, don’t trade it” stocks in the portfolio. Apple is the other one . Both are among the Club’s core holdings) Wells Fargo “[The company] missed expectations on third-quarter revenue. Investors focused instead on the bank running leaner and generating better-than-expected profitability. … We like the efficiency gains at the bank; the progress being made to get the Federal Reserve-imposed asset cap lifted; and the optimistic outlook for the economy and inflation.” — Oct. 11 before the bell (Wells Fargo is a core Club holding .) The Good Apple “[The company] delivered a quarter that can only be described as much better than feared. It wasn’t perfect, but it was pretty darn good. … We are once again reminded why it doesn’t pay to try to game Apple’s quarterly release. For all the fearmongering we have had to contend with over the past few weeks about just how horrendous this print was going to be, it ended up being a September quarter sales record for the world’s greatest consumer technology company.” — Oct. 31 after the bell Abbott Laboratories “In its third quarter, Abbott Labs demonstrated why we wanted to stick with the stock in the face of legal battles that emerged earlier this year and spooked investors. … [The company] upped its earnings guidance for the third straight quarter.” — Oct. 16 before the bell Bristol-Myers Squibb “Third-quarter earnings and revenue that blew past Wall Street’s expectations thanks to its blockbuster blood thinner Eliquis and a portfolio of drugs it expects to deliver long-term growth.” — Oct. 31 before the bell (The Club called Bristol-Myers up from the Bullpen and started a position on Nov. 25 , encouraged by the company’s FDA-approved drug Cobenfy, the first novel treatment for schizophrenia in over 30 years.) CrowdStrike “CrowdStrike CEO George Kurtz noted on the [fiscal 2025 third quarter] earnings release that the company has realized a gross retention rate of over 97%, an important factor given investor concerns about customers leaving the platform following a botched software update back in July that caused a global IT outage. Since the glitch, Kurtz and his team have put on a master class in addressing the company’s misstep — and as the fiscal third-quarter results show, it appears to be resonating with customers.” — Nov. 26 after the bell DuPont “DuPont’s performance on profitability metrics shined, with the better-than-expected operating EBITDA and earnings results for the quarter compounded by an increase to management’s full-year outlook on both metrics. Profit margin performance was also strong, as was cash flow generation, with transaction-adjusted free cash flow conversion of 130% — a sign of healthy earnings.” — Nov. 5 before the bell Danaher “Investors [on the earnings release] questioned the sustainability and magnitude of bioprocessing improvements in 2025. Wall Street’s reaction [then] does not reflect the strides Danaher made in that important end-market, which is contained in the company’s biotechnology segment.” — Oct. 22 before the bell (Danaher is a core Club holding .) Home Depot “High interest rates and economic uncertainty still weigh on Home Depot. But same store sales — a key metric in the retail space that seeks to adjust sales results for new store opening or closings — while down from a year ago, did show improvement in the U.S. and globally. The company raising its guidance is another reason to stay positive.” — Nov. 12 before the bell (Home Depot is a core Club holding .) Linde “It wasn’t the typical beat-and-raise quarter that Linde has become known for over the years. However, its profits growing faster than sales shows how adept the company is at navigating tough economic conditions. Once economic activity picks up – perhaps from lower interest rates around the globe – and volumes grow again, we expect Linde will be back to its usual beat-and-raise cadence.” — Oct. 31 before the bell (Linde is a core Club holding .) Microsoft “[Despite] positive trends and innovations, revenue guidance for next quarter fell a touch short of expectations. That’s a no-no in this market that needs beats and raises to send stocks higher, especially for a stock where there is still some investor frustration on whether these big AI bets will pay off.” — Oct. 30 after the bell Nextracker “Arguably the best part of Nextracker’s report was the increase in its backlog — even more so than the revenue and earnings beats. Why? Because questions about Nextracker’s backlog overshadowed stronger-than-expected headline results in August.” — Oct. 30 after the bell Palo Alto Networks “The cybersecurity company delivered strong fiscal 2025 first-quarter results, beating estimates on basically every line. It also raised full-year guidance across several key metrics. … The cybersecurity company delivered strong fiscal 2025 first-quarter results, beating estimates on basically every line. It also raised full-year guidance across several key metrics.” — Nov. 20 after the bell Salesforce “Wall Street is willing to look past Salesforce’s slight miss on adjusted EPS because of the upbeat revenue performance. Investors know Salesforce has become disciplined on margins, but what the market really wants to see next to take the stock higher is better topline growth. The quarterly results and outlook demonstrated that the company’s fundamentals have remained resilient without any contribution from one of the most exciting product launches in its history: Agentforce.” — Dec. 12 after the bell TJX Companies “While guidance was a bit below expectations, it was not overly concerning given the off-price retailer’s proclivity to under-promise and over-deliver. … We’re willing to look past the light outlook due to TJX’s history of conservative guides and because of the Q3 strength and the opportunities management sees for further growth.” — Nov. 20 before the bell (TJX is a core Club holding .) The Not so Bad Coterra Energy “Though sales and discretionary cash flow results came up short, management’s strict adherence to cost discipline allowed for beats where it counts: on earnings and free cash flow generation.” — Oct. 31 after the bell Eaton “We didn’t see anything in Eaton’s report or management’s outlook for the remainder of the year and into 2025 that causes us to rethink our investment. … A major driver for Eaton, central to our investment thesis, is selling products needed to power the build-out of data centers to handle artificial intelligence workloads.” — Oct. 31 before the bell (Eaton is a core Club holding .) Best Buy “Best Buy’s quarter came up short of expectations, with the misses compounded by downward revisions to management’s outlook for the remainder of the year. We were not surprised.” — Nov. 26 before the bell (During the December Monthly meeting, Jim said AI personal computer sales and lower mortgage rates were things he thought would happen and boost the stock. “Unfortunately, both have been a bust so far, and we’re not sure what 2025 has in store,” he said.) Dover “[The company] reported weaker-than-expected third-quarter results. … We’re not concerned: The company’s recent asset sales are likely causing some confusion about the numbers. … The reasons we own the stock, particularly its artificial intelligence exposure, are still fully intact.” — Oct. 24 before the bell GE Healthcare “Results were mixed, but it comes as no surprise that the quarter was negatively impacted by weakness in China. Excluding business in the world’s second-largest economy, reported ex-China sales were up about 5%, with ex-China organic order growth up 4% versus the prior year.” — Oct. 30 before the bell Starbucks “Returning soon to a Starbucks near you: Ceramic mugs, Sharpies on cups and the condiment bar to add your own cream and sugar. … [That’s according to Brian Niccol] … on his first earnings call since taking over as CEO of the struggling coffee giant on Sept. 9. Starbucks [on Oct. 23] preannounced an ugly set of fiscal 2024 fourth-quarter results and suspended 2025 guidance. So, the main event [earnings night] was what the former Chipotle boss had to say.” — Oct. 30 after the bell Stanley Black & Decker While the numbers were disappointing, the company’s turnaround continues to plan. … Sales missed in both key operating segments, Tools & Outdoor and Industrial, [but] we’re more focused on how profitability in each still managed to outpace expectations.” — Oct. 29 before the bell Constellation Brands Modelo and Corona brewer Constellation Brands is a tale of two businesses. One of them — beer — is stealing market share left and right. The other — wine and spirits — is an anchor on the stock. Nothing in the company’s fiscal 2025 second-quarter results on Thursday changed that narrative. But the next two quarters might. — Oct. 3 before the bell (We added some Constellation shares on Dec. 31 after calling it out in a Friday screen of cheap stocks to buy .) The Ugly Honeywell “[The] industrial giant reported mixed third-quarter results compounded by a mixed outlook. … Honeywell has proven to be a frustrating holding.” — Oct. 24 before the bell (In a commentary on Dec. 16 , we wrote, “Honeywell has responded to activist hedge fund Elliott Investment Management’s calls to break up the industrial conglomerate. Jim Cramer says it’s good news.”) Eli Lilly “The diabetes-and-obesity drug giant posted disappointing third-quarter results and lowered its full-year sales guidance. The report was messy, but it doesn’t dim Eli Lilly’s bright multiyear outlook.” — Oct. 30 before the bell (Lilly is a core Club holding . Jim Cramer has since called the drugmaker the “Nvidia of pharma.” ) — Jeff Marks , director of portfolio analysis for the CNBC Investing Club, contributed to this report. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) 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.
Larry Fink, Chairman and C.E.O. of BlackRock arrives at the DealBook Summit in New York City, November 30, 2022.
David Dee Delgado | Reuters
Another earning season is over. The winners? Most of our stocks. Twenty-three out of 33 portfolio names delivered third-quarter reports were deemed good or great by the Investing Club, thanks partly to a still-strong consumer and largely to the massive build out of all things AI.