Jim Cramer explains why investors should wait out ‘sloppy' post-earnings trading

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CNBC’s Jim Cramer pointed to ASML, a semiconductor company that saw shares plunge after it posted discouraging earnings a day earlier than expected.

CNBC's Jim Cramer advised investors not to trade when stocks react immediately to earnings reports, as some of these moves are not necessarily warranted.

"This is just the sloppy way that Wall Street reconsiders the price of a stock when compared to its peers and some parsed headlines during earnings season," he said."If you're not a professional, you should not be involved in this process."critiqued the market action Tuesday and advised investors not to trade when stocks react immediately to earnings reports, as some of these moves are not necessarily warranted.

"This is just the sloppy way that Wall Street reconsiders the price of a stock when compared to its peers and some parsed headlines during earnings season," he said."If you're not a professional, you should not be involved in this process."Cramer said it's unwise to extrapolate too much information from one company's earnings and apply that information to the rest of the industry and customers in general.

While he's against painting with broad strokes when it comes to earnings season, Cramer said he's not suggesting that there aren't important benchmarks and details worth paying attention to. Instead, he said, during the first stretch of trading after earnings, there's"action based on who knows what.

 

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