Jim Cramer recently highlighted a promising start to earnings season, pondering whether the two-year-old bull market can continue its upward trajectory during an episode of Mad Money. To address this, Cramer emphasized the importance of keeping emotions in check, cautioning against complacency. He turned to analysis by Jessica Inskip, a prominent figure in the investment community who currently serves as the Director of Investor Research at StockBrokers.com. Inskip, who co-hosts the Market MakeHer podcast, has made important forecasts, including identifying the bottom in big tech growth stocks earlier this year.
“… She nailed the bottom in big tech growth stocks this spring, and she’s been generally bullish, constructive on the major averages all year. And those are terrific calls. Well, as Inskip sees it, things are looking pretty darn good. But even as the rally’s broadening out, moving away from just the Magnificent Seven to a whole host of smaller stocks, she says, we still need tech to participate if we’re going to get another leg higher. Tech doesn’t have to lead the way anymore, but it has to at least follow the leaders.”
Cramer then shifted the conversation to the broader market, querying the potential of stocks outside the tech giants. He pointed out the value of the S&P 500 Equal Weight index, where all 500 components carry equal importance, contrasting it with the traditional market capitalization-weighted index, which heavily favors a few large companies. Cramer noted that 2024 has been particularly favorable for the 493 other stocks within the S&P 500, as the Equal Weight index has shown impressive performance.
“First, you can see this thing’s been doing great because 2024 has been all about the other 493 stocks in the index. Second, Inksip sees a lot to like here. The trading cycle for the S&P 500 Equal Weight is bullish. “
Cramer mentioned that Inskip is keenly watching for higher highs in this sector. While some technicians may view a rising RSI as a warning sign, Inskip reassures that it is not a concern as long as prices continue to climb. Currently, the S&P Equal Weight index remains well above its key quarterly moving averages, according to Inskip. Cramer reiterated the importance of this Equal Weight perspective, emphasizing that the performance is not overly reliant on the Magnificent Seven, as the broader index is being supported by the remaining stocks.
Turning to the Nasdaq 100, which features the hundred largest non-financial stocks on the Nasdaq, Cramer acknowledged that while Inskip sees it in a bullish trading cycle, it hasn’t yet reached new highs like the S&P. Nevertheless, the quarterly moving averages are still trending upward, providing support. Inskip pointed out that the Nasdaq made a higher high back in July, but for it to gain real momentum, it must surpass that peak. Once that level is breached, she believes it could trigger a broader market rally.
Coming toward the conclusion, Cramer said:
“Bottom line, the charts interpreted by Jessica Inskip are looking pretty darn good for the S&P and the Nasdaq 100… We’ve got a much broader bull market than we had six months ago. But if it’s going to keep running, Inskip says we need to see some meaningful participation from tech.”
10 Best Jim Cramer Stocks To Buy According to Analysts
Our Methodology
For this article, we compiled a list of stocks that Cramer was bullish on during episodes of Mad Money aired in October. We narrowed the list to 10 stocks that were most favored by analysts. We listed the stocks in ascending order of their average analyst price target upside as of October 18. The average price target upside was calculated while the market was open. We also mentioned the hedge fund sentiment around each stock, which was taken from Insider Monkey’s Q2 database of more than 900 hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Jim Cramer Stocks To Buy According to Analysts
10. The Walt Disney Company (NYSE:DIS)
Average Price Target Upside: 15.87%
Number of Hedge Fund Holders: 92
During a previous episode of Mad Money in October, Cramer said that he is a buyer of The Walt Disney Company (NYSE:DIS) stock.
“It’s come down quite a bit. It sells at 18 times earnings. It’s down today because of I think the storms, but you know what? Disney is doing much better than people realize. And it’s about time, people started giving a little more respect. I’m a buyer of it. The analysts are dumping all over it. They’re dumping all over it now. I say buy more Disney.”
Walt Disney Company (NYSE:DIS) is one of the biggest names in the global entertainment industry, engaging in various sectors such as film and television production, streaming services, and theme park operations. On October 15, UBS maintained its Buy rating on the stock with a price target of $120. UBS expects results for the fourth quarter to show challenges in the Parks division while highlighting profitability in direct-to-consumer segments, improved box office performance, and consistent trends in linear television.
The firm projects a year-over-year revenue increase of 7.2%, estimating an EBIT rise to $3.7 billion from $3 billion in the previous year, which could lead to a 33% growth in earnings per share for the quarter. For fiscal year 2024, the firm expects EPS growth exceeding 30%, aligning with management’s guidance of $4.92. Furthermore, mid-single-digit EPS growth is expected for fiscal year 2025, with the potential benefits from the deconsolidation of India assets and cost efficiencies from Hulu expected to create additional opportunities as the year unfolds.
Walt Disney Company (NYSE:DIS) is set to introduce a new attraction entry pass called the Lightning Lane Premier Pass. It allows guests willing to pay between $129 and $449 to enjoy exclusive access to some of the park’s most popular attractions. A limited number of these passes will be available starting October 23 at Disneyland in California, followed by a launch at Disney World a week later.
9. DuPont de Nemours, Inc. (NYSE:DD)
Average Price Target Upside: 17.07%
Number of Hedge Fund Holders: 58
Cramer previously discussed Barclays downgrading DuPont de Nemours, Inc. (NYSE:DD) and the company’s CEO.
“Why does Barclays do this? Why did they downgrade it? Well, it took it to sell after a really nice run that you wouldn’t have caught a penny of if you listened to the analysts. You’d be selling it right now, before the three-way breakup masterminded by Chairman Ed Breen, one of the greatest breakup artists to ever play the game. Seems crazy to me. But I guess Barclays feels that Breen doesn’t know what he’s doing. I wouldn’t take that bet. I say buy DuPont.”
DuPont de Nemours (NYSE:DD) provides technology-driven materials and solutions across a wide range of global markets. The company is engaged in delivering advanced materials that cater to diverse sectors, including electronics, safety, water purification, and various specialty applications. On October 16, it declared a quarterly dividend of $0.38 per share on its common stock, which is set to be distributed on December 16 to shareholders on record by November 29.
During the second quarter, DuPont de Nemours (NYSE:DD) completed the acquisition of Donatelle Plastics, a distinguished company specializing in medical components and devices. The acquisition added over 400 employees to the company’s workforce and integrated Donatelle into the Industrial Solutions sector of the Electronics & Industrial segment.
Donatelle’s advanced technologies advance the company’s capabilities in areas such as medical device injection molding, liquid silicone rubber processing, precision machining, and device assembly. The company has a promising growth trajectory, focusing on therapeutic fields that include electrophysiology, drug delivery, diagnostics, cardiac rhythm management, neurostimulation, and orthopedic extremities.
8. Pure Storage, Inc. (NYSE:PSTG)
Average Price Target Upside: 18.21%
Number of Hedge Fund Holders: 38
Talking about Pure Storage, Inc. (NYSE:PSTG) during a lightning round, Cramer said, “It does its job very well. It’s actually had a good run here. I think I would hold on to it.”
Pure Storage (NYSE:PSTG) provides advanced data storage and management solutions, with its Purity software notable for delivering data reduction and protection across various storage protocols. The company’s stock went up after Guggenheim’s analyst Howard Ma identified it as a key investment opportunity, labeling it the “best idea.” Following this assessment, Ma raised the price target for the stock from $72 to $93 as reported by TipRanks on October 17.
According to Ma, the company is on the verge of announcing a significant deal with one of the top four hyperscalers in the near future. This anticipated partnership is expected to generate substantial value, with projections estimating an aggregate worth of $3 billion over the next five years. The collaboration is expected to involve both integrated software and hardware solutions.
For the third quarter of fiscal 2025, Pure Storage (NYSE:PSTG) management has forecasted revenue to reach $815 million, which is a year-over-year growth of 6.8%. Additionally, the non-GAAP operating income is forecasted to be $140 million, representing a margin of 17.2%.
7. McKesson Corporation (NYSE:MCK)
Average Price Target Upside: 19.29%
Number of Hedge Fund Holders: 70
During a lightning round, Cramer commented on McKesson Corporation (NYSE:MCK) and said:
“It’s time to buy it. You know they’re not just a middleman. They do a lot of good things and I think the stock has had way too big a hit. It’s now selling at a below-market multiple. I’m ready to start buying. Don’t buy all at once. Buy in a pyramid style.”
McKesson (NYSE:MCK) offers various healthcare services, focusing on the distribution of pharmaceutical products and providing support to oncology practices and pharmacies. The company adjusted its fiscal 2025 guidance for adjusted earnings per diluted share, raising the range to $31.75 to $32.55 from an earlier estimate of $31.25 to $32.05. The updated guidance reflects approximately $0.62 in year-to-date gains from its Ventures’ equity investments.
McKesson (NYSE:MCK) forecasts revenue growth in its U.S. Pharmaceutical segment, expecting an increase of 13% to 16%. In Prescription Technology Solutions, revenue is projected to rise by 14% to 18%, although operating profit is expected to increase by 11% to 15%, indicating a modest decline from previous forecasts. For Medical-Surgical Solutions, revenue growth is forecasted between 3% and 7%, with operating profit likely falling at the lower end of the initial guidance range of 6% to 8%. Meanwhile, the International segment is forecasted to see revenue growth of 4% to 8%, coupled with an 8% to 12% increase in operating profit.
Management expressed satisfaction with the performance of the Canadian business during the first quarter and expects this growth trend to continue throughout fiscal 2025. The guidance also includes plans to repurchase around $2.8 billion in shares over the fiscal year.
6. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Average Price Target Upside: 20.70%
Number of Hedge Fund Holders: 108
Cramer has commended Advanced Micro Devices, Inc.’s (NASDAQ:AMD) CEO and expressed interest in the company’s analyst day and its result. Here’s what he had to say:
“Not to be outdone, Lisa Su, the CEO of AMD, will hold an analyst day and it’s entitled Advancing AI 2024. It starts at noon. Today, when the stock was plummeting, I told investing club members at my 10:20 morning meeting that Su’s presentation could show this charitable trust holding in a whole new light, even as they’ve been raising their AI sales forecast quarter after quarter after quarter. I think it’s a buy ahead of the meeting, although the stock did run eight points after we talked about it at the morning meeting.”
Advanced Micro Devices (NASDAQ:AMD) is a prominent semiconductor company known for its diverse product offerings, which include x86 microprocessors, graphics processing units (GPUs), chipsets, and various solutions tailored for data centers. The company recently hosted an event titled “Advancing AI” on October 10, where CEO Lisa Su provided insights into the upcoming generation of chips, which showed that the company is making significant progress in its technology development.
During the event, Su highlighted the new MI325X chip, which is designed to deliver 80% more high-bandwidth memory compared to the H200 and improve inference performance by 30%. Although the MI325X is not expected to ship until the first quarter of 2025, it represents an important step in Advanced Micro Devices’ (NASDAQ:AMD) ongoing innovation efforts.
Su also announced plans to introduce another new GPU, the MI350X, next year. This chip, based on the next-generation CDNA (compute DNA) 4 architecture, is expected to achieve a remarkable 35-fold increase in performance over its predecessor, the MI300X. The MI350X is positioned to compete directly with Nvidia’s Blackwell chips, with shipments scheduled to begin in the second half of 2025.
5. Banco Santander, S.A. (NYSE:SAN)
Average Price Target Upside: 22.90%
Number of Hedge Fund Holders: 9
Cramer likes Banco Santander, S.A. (NYSE:SAN) and has previously recommended it if one wishes to invest in a foreign bank. He remarked, “If you want a foreign bank, please go for Banco Santander, that’s a real good one.”
Banco Santander (NYSE:SAN) offers various financial services on a global scale, including deposits, loans, asset management, and various insurance products. It also plays a significant role in corporate finance, investment banking, and digital payment solutions. In the first half of the year, the company reported a revenue increase of 10%, driven by strong performance across all five of its global business segments.
Costs have remained largely stable over the past four quarters, contributing to an impressive 19% growth in earnings per share. Executive Chair Ana Botín highlighted that this performance shows the effectiveness of the company’s scale, diversification, and the successful execution of its transformation efforts, which together support sustainable and profitable growth.
During the second quarter, Banco Santander (NYSE:SAN) reported record revenue of €31.050 billion, representing a 10% increase year-over-year, while earnings per share rose by 19%. The strong momentum experienced in the business led to an upgrade in the company’s targets for 2024, now forecasting high-single-digit revenue growth, an improved efficiency ratio of approximately 42%, and a return on tangible equity (RoTE) exceeding 16%. Despite these adjustments, the company has maintained its targets for a cost of risk of around 1.2% and a fully loaded Common Equity Tier 1 (CET1) ratio above 12% following the implementation of Basel III regulations.
4. Cadence Design Systems, Inc. (NASDAQ:CDNS)
Average Price Target Upside: 23.05%
Number of Hedge Fund Holders: 64
On October 9’s episode of Mad Money, Cramer said to buy more of Cadence Design Systems, Inc. (NASDAQ:CDNS) shares.
“Stay long [on] it. I just checked in with them again. I think they’re doing incredibly well. Cadence is a winner. Stay long [on] it. Buy some more.”
Cadence Design (NASDAQ:CDNS) offers software, hardware, services, and reusable integrated circuit (IC) design blocks on a global scale. In the previous year, the company achieved sales of $4.09 billion through a diverse network operating across 26 countries. On October 15, TipRanks reported recent insights from Berenberg analyst Nay Soe Naing that highlight the company’s strong position within the semiconductor design solutions sector. Naing emphasizes that the company plays a vital role in fostering innovation in the industry, benefiting from structural trends driven by ongoing technological advancements.
The analyst points out that its business model, heavily reliant on research and development spending, insulates the company from the cyclical nature often seen in the semiconductor market. This unique positioning allows Cadence Design (NASDAQ:CDNS) to maintain stability while capitalizing on growth opportunities.
The report indicates that the company is outpacing its competitors, thanks in part to its high-quality product portfolio and operational efficiency. Furthermore, the potential for capturing market opportunities in AI-driven semiconductor design is expected to accelerate this growth. Supporting this positive outlook, Naing has assigned a Buy rating to the company’s stock, with a price target of $320.
3. NIO Inc. (NYSE:NIO)
Average Price Target Upside: 23.34%
Number of Hedge Fund Holders: 20
Jim Cramer was asked about NIO Inc. (NYSE:NIO) during a lightning round of Mad Money and he said, “I want you to hold on”.
NIO (NYSE:NIO) is involved in the design, development, manufacturing, and sale of intelligent electric vehicles in China, offering a diverse lineup that includes both five- and six-seater electric SUVs, as well as smart sedans. The company has experienced significant momentum in 2024, with a solid rise in deliveries and a stabilization of vehicle margins. Recent stimulus measures in China have the potential to further boost consumer interest, while the company is also making strides in expanding its presence in the European market.
In the third quarter, NIO (NYSE:NIO) achieved record-breaking deliveries, reaching a total of 61,855 vehicles, which marks an increase of 11.6% compared to the same period last year. As of September 30, 2024, cumulative deliveries reached 598,875 vehicles. Additionally, September alone saw 21,181 vehicles delivered, a remarkable 35.4% year-over-year increase. This total included 20,349 vehicles from its premium smart electric vehicle brand, alongside 832 vehicles from its family-oriented brand, ONVO.
The company has forecasted a significant improvement in vehicle margins, projecting them to reach 15% by the end of 2024. The introduction of ONVO as the company’s first mass-market brand is a pivotal step, with expectations that the L60 SUV will be particularly popular among consumers. It plans to continue this trajectory by launching a new model under the ONVO brand each year.
2. Schlumberger Limited (NYSE:SLB)
Average Price Target Upside: 43.06%
Number of Hedge Fund Holders: 67
Cramer previously mentioned Schlumberger Limited (NYSE:SLB), saying that the stock did not climb as per his expectations.
“SLB has not gone up nearly as much as I would’ve expected. Given the fact that oil’s up, I would buy the stock right here. It is the best of breed.”
Schlumberger (NYSE:SLB) is a provider of technology and services to the global energy sector, specializing in various aspects of field development, hydrocarbon extraction, and carbon management.
On October 18, the company reported its third-quarter results, with revenue of $9.16 billion, which remained stable compared to the previous quarter and marked a 10% increase year-over-year. The company’s GAAP earnings per share reached $0.83, showing an 8% rise sequentially and a 6% increase from the same period last year. A significant development for the company was the acquisition of Aker’s subsea business, which occurred in the fourth quarter of 2023 as part of the establishment of the OneSubsea joint venture. It contributed revenue of $532 million during the third quarter of 2024.
Additionally, Schlumberger (NYSE:SLB) reported cash flow from operations of $2.45 billion for the third quarter and a free cash flow of $1.81 billion. For the entirety of 2024, capital investments, which include capital expenditures, exploration data costs, and APS investments, are projected to remain around $2.60 billion, consistent with the level seen in 2023.
1. New Fortress Energy Inc. (NASDAQ:NFE)
Average Price Target Upside: 76.41%
Number of Hedge Fund Holders: 20
Cramer has previously praised New Fortress Energy Inc.’s (NASDAQ:NFE) CEO and said:
“… This Wes Edens, he is so good. It’s down like three quarters, like down like 75%. I think that you have to stick with it. I’ve been wrong. I’ve been wrong in New Fortress because I believe in Wes so closely. I’d love Wes to come back on the show.”
New Fortress Energy (NASDAQ:NFE) operates as an integrated company focused on transforming gas into power and providing energy infrastructure services worldwide. It has been navigating a challenging landscape recently, prompting significant adjustments to its financial strategy. On October 5, Morgan Stanley downgraded the company stock to Equal Weight from Overweight with a price target of $15, down from $35.
The company has recently taken several measures to tackle issues related to liquidity and refinancing, which helps alleviate a significant concern. The firm notes that although the company’s shares are currently valued below the fair market price for its existing assets, it faces increased execution risks due to high leverage and an elevated interest burden. The analyst pointed out that project delays, cost overruns, and the premature termination of the FEMA contract in Puerto Rico have exerted additional pressure on the company’s financial health.
To address these challenges, New Fortress Energy (NASDAQ:NFE) has recently negotiated with creditors to exchange several outstanding notes—6.75% notes due in 2025, 6.50% notes due in 2026, and 8.75% notes due in 2029—for new notes with a higher interest rate of 12%, due in 2029. The arrangement also involves securing the new notes with a 49% stake in the company’s operations in Brazil, providing creditors with enhanced collateral.
Additionally, the company moved to improve its capital position through a public offering, successfully selling 46.3 million shares at a price of $8.63, which resulted in a capital raise of approximately $400 million. It is important to note that chairman and CEO Wesley R. Edens demonstrated confidence in the company by purchasing 5.8 million shares in this offering.
While we acknowledge the potential of New Fortress Energy Inc. (NASDAQ:NFE) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NFE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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