Cramer: 'Astounding numbers' at struggling GE, Raytheon may justify stock market's rally
The stock market's rally during spiking Covid cases may be justified by strong earnings from struggling American industrial companies like General Electric and Raytheon , CNBC's Jim Cramer said Tuesday.

Both companies released quarterly results Tuesday morning, giving positive signals for cash flow.

"These are astounding numbers," Cramer said on "Squawk on the Street." "It makes you feel like, wait a second, the market went up lot; maybe it should have."

"When I look at GE, I'm thinking 'Houdini,' miraculous, incredible," Cramer said after GE delivered better-than-expected industrial free cash flow for the fourth quarter and a rosy outlook for this year. Shares were jumping about 5.6%. Revenue for Q4 of nearly $22 billion exceeded estimates, but per-share earnings of 8 cents missed forecasts by a penny.

"When you look at Raytheon and when you look at General Electric, has it occurred to you that nobody is flying and yet they're crushing it when it comes to aviation?" the "Mad Money" host said, while noting that GE and Raytheon have undergone massive cost-cutting measures, including tens of thousands of job cuts.

While orders in GE's beleaguered aviation unit fell 41% compared with a year ago, Cramer said he was encouraged that it was not down even more. "If you adjust the baseline it's surprising that they didn't have a dramatic fall off versus last year, which was an amazing quarter," he said.

Shares of Raytheon were up 3.3% after the company beat its 2020 cash flow guidance, beat estimates with adjusted fourth-quarter earnings of 74 cents per share and revenue of $16.42 billion.

Raytheon's Pratt & Whitney unit, which makes and services aircraft engines, beat sales expectations. However, the aerospace manufacturer forecast a full-year revenue outlook that was below estimates.

"The free cash flow of both these companies, Raytheon and GE, is surprising," Cramer said, while adding that GE's health care, wind, and hydrogen turbine businesses are also growing.

While stronger Tuesday, GE shares are flat over the past 12 months. Raytheon shares are down more than 50% over the same period.

Both stocks were once among the 30 components that make up the Dow Jones Industrial Average . GE, which had been a continuous member since 1907, was replaced in the Dow by drugstore chain Walgreens Boots Alliance in 2018. Raytheon was replaced by conglomerate Honeywell International last year.