What we need to hear from Coterra's CEO after the energy company's stumbles
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Market update: Stocks are rising on Thursday, with the S & P 500 heading toward its fourth consecutive gain and the Nasdaq Composite aiming for a seventh straight positive session. The gains come despite a sluggish start to the session. Better-than-expected earnings from major companies like Cisco Systems , Walmart , and Deere boosted sentiment. Additionally, a sharp drop in the 10-year Treasury yield may be providing some relief to stocks, easing concerns that had started to grow during its recent climb toward 4.5%. (Higher bond yields generally lead to higher interest rates on mortgages, car loans and credit cards, which can lower consumer spending and business investment — and lead to slower economic growth). Still, we trimmed our Eaton position this morning to raise a little extra cash, reflecting our hesitance to put new money to work at current levels due to the market's comeback over the past few weeks and ongoing overbought conditions. Investors need answers: Coterra Energy CEO Tom Jorden will join Jim on "Mad Money" later for an interview. This comes about a week after the company reported first-quarter earnings that had a lot of hair on it, causing the stock to drop 9% the next day. While it was encouraging to see Coterra adjust its capital allocation budget to favor natural gas production over oil — reflecting current commodity price dynamics — the market reacted sharply to operational issues. Specifically, the company reported higher-than-expected water volumes at some wells in the Harkey area of the Permian Basin. Coterra has become such a consistent operator, so it was very surprising to see a stumble like this. In addition, investors were disappointed by the lack of planned share buybacks for the remainder of the year, as management is prioritizing debt reduction. The company needs to clear the air on this Harkey incident and deliver a quick resolution, as the market tends to punish exploration and production firms like Coterra when there are doubts about the quality of their inventory. Up next: Coming up after the closing bell Thursday are earnings from Take-Two Interactive , Applied Materials , and Cava . There are no major earning releases on Friday . On the data side, we'll see April housing starts and building permits, import price data, and May University of Michigan consumer sentiment and inflation expectations. (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. A pump jack operates near a gas turbine power plant in the Permian Basin oil field outside of Odessa, Texas, U.S. February 18, 2025.
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street.
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