In this article, we will take a look at the 10 inverse Cramer stocks to buy now according to analysts. If you want to explore similar stocks, you can also take a look at 5 Inverse Cramer Stocks To Buy According to Analysts.
“It’s Like They Don’t Care About The Debt Ceiling Negotiations At All”
In a recent episode of Mad Money, aired on May 23, Jim Cramer discussed the surprising market reaction to the ongoing debt ceiling talks and provided insights into the sectors that may be impacted if the government defaults on its debt. According to Cramer, despite the potential risks, the market showed resilience as investors focused on growth stocks and seemingly brushed off the concerns surrounding the debt ceiling negotiations.
Cramer highlighted the noteworthy performance of companies that reported poor earnings but showed strong potential for future growth. Tech stocks, particularly cybersecurity stocks, remained in demand despite debt ceiling concerns. The market’s response indicates that investors believe these companies will continue to thrive, even in the face of a potential crisis.
On the other hand, consumer packaged goods companies that have historically rallied during periods of economic uncertainty, experienced a downturn. This divergence in performance suggests that the market is not heavily influenced by concerns about a debt ceiling impasse and remains optimistic about the overall economy. Though the market is not optimistic about these stocks, Cramer thinks these stocks “are in the sweet spot, even if we crash through the debt ceiling deadline”.
Cramer also discussed industries that would likely be impacted if the government were to default on its debt obligations. First, he highlighted that the real estate sector could suffer due to the anticipated rise in long-term interest rates, potentially making mortgages unaffordable. Additionally, banks would face uncertainty and may struggle as well. Utilities and companies heavily reliant on credit, such as those in the heavy machinery, aircraft parts, and auto sectors, could also experience temporary setbacks.
Cramer is known for his outspoken opinions on stocks, and he often makes bold predictions about the market. However, not everyone agrees with Cramer’s picks. In fact, some investors believe that the best way to make money in the stock market is to do the opposite of what Cramer says. That’s where the Inverse Cramer ETF (SJIM) comes in.
The Inverse Cramer ETF (SJIM) is an actively managed exchange-traded fund designed to generate returns that are opposite to the investment outcomes of Jim Cramer’s recommended investments, prior to accounting for fees and expenses. In other words, if Cramer recommends a stock, SJIM will short that stock. If Cramer recommends selling a stock, SJIM will buy that stock. Some of the most notable inverse Cramer stocks that Wall Street analysts see material upside to include Western Alliance Bancorporation (NYSE:WAL), First Horizon National Corporation (NYSE:FHN), and PayPal Holdings, Inc. (NASDAQ:PYPL).
Our Methodology
To determine the best inverse Cramer stocks to buy now according to analysts, we went through the holdings of the Inverse Cramer ETF and sourced each stock’s average analyst price target and average upside potential from TipRanks. We narrowed down our selection to stocks that had the highest average upside potential, based on analyst price targets, as of May 29. We have included the average analyst price target, average upside potential, and the hedge fund sentiment along with each of our picks. These stocks are ranked in ascending order of their average upside potential.
10 Inverse Cramer Stocks To Buy According to Analysts
10. Ralph Lauren Corporation (NYSE:RL)
Average Upside Potential as of May 29: 21.11%
Average Analyst Price Target: $136.56
Number of Hedge Fund Holders: 31
Return since May 29th: 6.1%
On May 25, Ralph Lauren Corporation (NYSE:RL) announced market-beating earnings for the fourth quarter of fiscal 2023. The company reported an EPS of $0.90 and outperformed EPS estimates by $0.30. The company’s revenue for the quarter amounted to $1.54 billion, up 0.90% year over year and ahead of Wall Street consensus by $67.77 million.
This May, UBS analyst Jay Sole raised his price target on Ralph Lauren Corporation (NYSE:RL) to $168 from $154 and maintained a Buy rating on the shares. As of May 29, the stock has gained 11.54% over the past 12 months.
Wall Street is bullish on Ralph Lauren Corporation (NYSE:RL). Over the past 3 months the stock has received 7 Buy ratings and 1 Hold rating from Wall Street analysts. The stock has an average price target of $136.56, which implies an upside of 21.11% from current levels. Ralph Lauren Corporation (NYSE:RL) is placed tenth on our list of the best inverse Cramer stocks to buy now, according to analysts.
At the end of Q1 2023, 31 hedge funds were long Ralph Lauren Corporation (NYSE:RL) and held stakes worth $489.5 million in the company. Of those, Royce & Associates was the top investor in the company and held a stake worth $58.5 million.
9. Occidental Petroleum Corporation (NYSE:OXY)
Average Upside Potential as of May 29: 21.60%
Average Analyst Price Target: $71.67
Number of Hedge Fund Holders: 81
Return since May 29th: -4.6%
On May 11, Truist analyst Neal Dingmann updated his price target on Occidental Petroleum Corporation (NYSE:OXY) to $85 from $86 and maintained a Buy rating on the shares. Occidental Petroleum Corporation (NYSE:OXY) is one of the best inverse Cramer stocks to buy now according to analysts.
Occidental Petroleum Corporation (NYSE:OXY) has an average analyst price target of $71.67, which represents an upside of 21.60% from its closing price on May 29. The stock has received 8 Buy ratings and 7 Hold ratings from analysts over the past 3 months.
Occidental Petroleum Corporation (NYSE:OXY) was spotted on 81 investors’ portfolios at the end of Q1 2023. These funds disclosed collective stakes worth $16.2 billion in the company.
As of March 31, Berkshire Hathaway is the most prominent shareholder in the company and has disclosed a position worth $13.2 billion.
In addition to Occidental Petroleum Corporation (NYSE:OXY), other stocks that Wall Street analysts see meaningful upside to include Western Alliance Bancorporation (NYSE:WAL), First Horizon National Corporation (NYSE:FHN), and PayPal Holdings, Inc. (NASDAQ:PYPL).
8. VICI Properties Inc. (NYSE:VICI)
Average Upside Potential as of May 29: 21.75%
Average Analyst Price Target: $37.17
Number of Hedge Fund Holders: 39
Return since May 29th: 1.6%
39 hedge funds disclosed having stakes in VICI Properties Inc. (NYSE:VICI) at the end of Q1 2023. The total value of these stakes amounted to $901.15 million.
On May 1, Ladenburg raised its price target on VICI Properties Inc. (NYSE:VICI) to $37 from $34.50 and reiterated a Buy rating on the shares.
Over the past 3 months, VICI Properties Inc. (NYSE:VICI) has received 11 Buy ratings and 1 Hold rating from Wall Street analysts. The stock has an average price target of $37.17. The stock’s average price target implies an upside of 21.75% from current levels.
As of March 31, Citadel Investment Group is the largest stockholder in the company and has a stake worth 319.7 million.
Baron Funds made the following comment about VICI Properties Inc. (NYSE:VICI) in its Q4 2022 investor letter:
“We remain optimistic about the Fund’s triple net gaming REIT investments in VICI Properties Inc.(NYSE:VICI) and Gaming and Leisure Properties, Inc. The companies primarily own quality casino and gaming real estate properties. They have attractive dividend yields in the 5% to 6% range that are well covered, accretive acquisition growth opportunities, and are, in our opinion, attractively valued.
We remain mindful of the rising interest rate environment and the possibility that higher debt costs and lower equity prices could negatively impact the ability for net lease REITs to invest in an accretive fashion.”
7. Five Below, Inc. (NASDAQ:FIVE)
Average Upside Potential as of May 29: 27.14%
Average Analyst Price Target: $225.38
Number of Hedge Fund Holders: 32
Return since May 29th: 11.9%
Five Below, Inc. (NASDAQ:FIVE) is placed seventh on our list of the best inverse Cramer stocks to buy now according to Wall Street analysts. The stock has an average price target of $225.38, which represents an upside of 27.14% from its closing price on May 29. Over the past 3 months, the stock has received 13 Buy ratings and 1 Hold rating from analysts.
This May, Citi revised its price target on Five Below, Inc. (NASDAQ:FIVE) to $220 from $225 and reiterated a Buy rating on the shares. As of May 29, the stock has returned 10.20% to investors over the past 6 months.
At the end of the first quarter of 2023, 32 hedge funds were bullish on Five Below, Inc. (NASDAQ:FIVE) and disclosed positions worth $712.4 million in the company. Of those, Rivulet Capital was the top investor in the company and disclosed a stake worth $132.7 million.
Wasatch Global Investors made the following comment about Five Below, Inc. (NASDAQ:FIVE) in its Q4 2022 investor letter:
“Another strong stock in the strategy was Five Below, Inc. (NASDAQ:FIVE). A specialty value retailer, the company offers a variety of merchandise at discounted prices. Five Below’s stock price rose sharply in early December after the company reported better-than-expected financial results and guided higher on revenues and earnings. The upbeat news cheered investors who had been concerned about Five Below’s ability to attract shoppers during the upcoming inflation-marred holiday season. We think the company’s debt-free balance sheet, substantial free cash flows, expanding store count and new Five Beyond format—in which prices can go as high as $25 in a designated section of the store—leave Five Below well-positioned for growth even in a potentially difficult retail environment.”
6. Boston Properties, Inc. (NYSE:BXP)
Average Upside Potential as of May 29: 27.96%
Average Analyst Price Target: $61.09
Number of Hedge Fund Holders: 22
Return since May 29th: 7.9%
At the close of the Q1 2023, 22 hedge funds were eager on Boston Properties, Inc. (NYSE:BXP) and held stakes worth $359.6 million in the company. Of those, First Eagle Investment Management was the leading investor in the company and held a position worth $202.8 million.
On April 25, Boston Properties, Inc. (NYSE:BXP) released earnings for the fiscal first quarter of 2023. The company generated a revenue of $803.20 million, up 6.48% year over year, and beat Wall Street estimates by $24.40 million. The company reported an FFO of $1.73 and beat expectations by $0.05.
On May 1, Argus updated its price target on Boston Properties, Inc. (NYSE:BXP) to $70 from $82 and maintained a Buy rating on the shares.
Over the past 3 months, Boston Properties, Inc. (NYSE:BXP) has received 5 Buy ratings and 7 Hold ratings from analysts. The stock has an average price target of $61.09, which represents an upside of 27.96% from current levels.
Some of the most popular inverse Cramer stocks among Wall Street analysts right now include Western Alliance Bancorporation (NYSE:WAL), First Horizon National Corporation (NYSE:FHN), and PayPal Holdings, Inc. (NASDAQ:PYPL).
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Disclosure: None. 10 Inverse Cramer Stocks To Buy According to Analysts is originally published on Insider Monkey.