Cramer shares insights to help make sense of this earnings season
CNBC's Jim Cramer knows that executives rarely sound the alarm when something is wrong at their company. So on Tuesday, he drew back the curtain to try to explain what earnings reports can mean for stocks.

Cramer broke down the companies he's watching into categories: continually good quarter (or continued excellence), first good quarter, last bad quarter, first bad quarter and confusing quarter.

"I know it seems cumbersome, but that's truly the behind-the-scenes nomenclature that fund managers use," Cramer said. "You just have to figure out what you got your hands on before you do your buying or selling."

Cramer first listed companies that are experiencing "continually good quarters," including homebuilder PulteGroup and paint maker Sherwin-Williams . The former, he said, is experiencing success despite Federal Reserve tightening, while Sherwin-Williams is rallying because of a strong demand for paint and a continued decline in raw costs. He also put General Electric and Google parent Alphabet in this category.

Next, Cramer moved on to "first good quarter," highlighting NXP Semiconductors , which he said "had been having a tougher time of it," but reported a better-than-expected quarter on Monday. Despite its multibillion-dollar "forever chemicals" litigation, the company raised its full-year expectations, Cramer said.

He also mentioned health-care and pharmaceutical company Danaher , which is owned by the CNBC Investing Club Charitable Trust. Cramer said he thinks the company is having its "last bad quarter," which could present a buying opportunity.

"If you want the most bang for your buck — I mean, but there's also the most risk — you should try to anticipate the last bad quarter," that means you have to get in before management says business has bottomed, Cramer said.

Cramer pointed to aerospace giant RTX , formerly known as Raytheon Technologies, as a company likely experiencing a "first bad quarter," plagued by an engine recall. But Cramer pointed out that the company still has a "mammoth order book" and solid organic growth, so he said he thinks it's possible this might be an outlier poor quarter.

Finally, Cramer discussed companies with "confusing quarters" like GE HealthCare , which he suggested the market might be wrong about because of its contributions to Alzheimer's treatment.