We recently published an article titled, Jim Cramer’s Best Performers List: Top 10 Picks. In this article, we are going to take a look at where CBRE Group, Inc. (NYSE:CBRE) stands against other stocks in Jim Cramer’s best performers list.
During Mad Money’s episode on October 1, host Jim Cramer urged investors to remember the market’s strong performance over the past quarter, making note of the rising tensions in the Middle East, which led to a decline in major stock indices on Tuesday.
He pointed out that the landscape has shifted beyond just the major technology companies, and shed light on the top performers of the S&P 500. Cramer observed that the last three months have witnessed what he described as “the revenge of the little guy companies.” He said:
“When you look at the 10 best performers of the third quarter, we discover that this formerly narrow market has totally changed its stripes.”
Cramer emphasized that the current market rally is driven by companies that are often overlooked. He said:
“It is a remarkable list that represents a real broadening out of the winners. Some would say it’s a sign of where we’re headed. I might not go that far, but clearly, we need to start digging a lot deeper to find winners going forward.”
In his recent commentary, Cramer highlighted that the major winners of the third quarter were unexpectedly obscure, primarily comprising a group of ten stocks focused on power generation and interest rate cuts.
He pointed out that these stocks diverged from the well-known Magnificent Seven and traditional FAANG names, with an absence of fast-growing medical or cybersecurity companies, many of which have faced challenges recently.
Cramer suggested that investors look to the bottom of the S&P 500 for insights into market trends. He noted that Super Micro finished last for the quarter, plummeting 49%. It serves as a reminder that backing the wrong AI investment can lead to significant losses. Despite this, Cramer emphasized the need for the market to focus on new stocks for long-term growth rather than relying on past leaders.
Our Methodology
For this article, we compiled a list of 10 stocks that Jim Cramer mentioned during his episode of Mad Money on October 1. We listed the stocks in ascending order of their hedge fund sentiment as of the second quarter, which was taken from Insider Monkey’s 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).
CBRE Group, Inc. (NYSE:CBRE): Cramer Says To ‘Think Twice Before Being So Negative On Commercial Real Estate’
CBRE Group, Inc. (NYSE:CBRE)
Number of Hedge Fund Holders: 54
CBRE Group, Inc. (NYSE:CBRE) functions as a commercial real estate services and investment company operating in the U.S., the U.K., and internationally. Its Advisory Services segment offers strategic advice for leasing office, industrial, and retail spaces, along with property sales, mortgage financing, management services, and valuation.
The Global Workplace Solutions segment provides facilities management and project management services under the Turner & Townsend brand. The Real Estate Investments segment delivers investment management services under the Trammell Crow Company and Telford Homes brands.
During Mad Money’s episode, in relation to the company, Cramer said:
“We’ve gotten used to people coming on air and warning us about the looming demise of commercial real estate. Well, someone better tell the people at CBRE, which does everything from commercial real estate advisory and transaction services to valuation property management. The fact that this stock could be up almost 40% for the quarter tells me, maybe we should think twice before being so negative on commercial real estate.”
In the second quarter, CBRE Group (NYSE:CBRE) made significant acquisitions totaling approximately $290.9 million, primarily focused on Direct Line Global, a leading provider of technical facilities management services catering to data center owners and operators.
The acquisition strengthens the company’s service offerings, especially for some of the world’s largest technology companies in hyperscale, co-location, and enterprise markets.
Additionally, the giant acquired a provider of local facilities management technical services based in Canada during Q2, further broadening its capabilities in that region. During the quarter, CBRE Group (NYSE:CBRE) also announced plans to merge its project management business with Turner & Townsend.
The new combined business is expected to be reported as a distinct business segment starting in 2025. The integration is expected to create a premier project, program, and cost management business, with over 20,000 employees serving clients across more than 60 countries.
Third Avenue Management stated the following regarding CBRE Group, Inc. (NYSE:CBRE) in its first quarter 2024 investor letter:
“Data Center Services: As data centers have evolved into a distinct sub-set of many real estate mandates, the services provided for “more traditional” property types have expanded into this niche sector. As a result, some of the leading real estate services companies (including Fund holdings CBRE Group, Inc. (NYSE:CBRE), JLL, and Savills plc) have dedicated teams with the capabilities to support facilities management, leasing, advisory, investment sales, and other solutions. Such activity requires limited capital investment but can generate meaningful recurring revenues and transactional fees. For example, CBRE manages approximately 700 data centers globally and has advised on more than $6.0 billion of data center transactions.”
Overall, CBRE ranks 4th on our list of Jim Cramer’s best performers. While we acknowledge the potential of CBRE 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 CBRE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure: None. This article is originally published at Insider Monkey.
