Jim Cramer says patience in Wynn Resorts will be rewarded after surprise post-earnings drop
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. The major U.S. stock indexes were mixed Wednesday, as the Dow Jones Industrial Average tries to extend its five-day winning streak. Jim Cramer said the blue-chip Dow may be able to hold up in the face of a weaker U.S. economy because some of its components, such as drugmaker Merck , are defensive stocks that investors covet during slowdowns. “There are cracks” in the economy, Jim said. “But there are enough stocks that do well in a cracks environment that you’re not going to see it in the Dow.” Meanwhile, U.S. oil prices hit their lowest level since mid-March early Wednesday as rising inventories weigh on the market. Wynn Resorts shares tumbled more than 2% after the opening bell despite a stronger-than-expected quarterly release on Tuesday evening. Shares were initially higher in extended trading Tuesday. The casino operator delivered an earnings beat, highlighted by continued recovery in China’s Macao region, where its margins are now higher than pre-pandemic levels. Investor concerns around consumer spending in the U.S. and the Chinese economy have weighed on shares. “I’m not going to say that this thing isn’t going to go to $93,” Jim said. But, he contended, the analysts who raised their price targets after earnings will “ultimately be right. That doesn’t mean they’re going to be right today.” Walt Disney stock edged higher Wednesday, trying to recoup losses from the entertainment giant’s overdone earnings sell-off Tuesday. Considering we sold stock twice last month at higher prices, we’re interested in buying some of it back. Jim said Disney falling below the $100-per-share level — a little more than a 5% dip from its Wednesday intraday price — would prompt us to act. “I’m willing to battle Disney because I think the fourth quarter will be good.” Jim said. However, he argued a “new name” could be a better place to deploy capital at current prices. (Jim Cramer’s Charitable Trust is long WYNN, DIS. 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.
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