We recently published an article titled, Jim Cramer’s Latest Lightning Rounds: 15 Stocks to Watch. In this article, we are going to take a look at where New Fortress Energy Inc. (NASDAQ:NFE) stands against other stocks discussed by Jim Cramer during the latest lightning rounds.
Recently on Mad Money, host Jim Cramer stressed the necessity of staying updated on economic indicators, government actions, and industry developments to make informed investment choices. He emphasized that speculation should be approached with the mindset of a “pro” rather than a novice. Cramer mentioned that while he does not oppose speculation, it must be done with an understanding of the risks involved. He remarked:
“Otherwise, if things go south, you’ll be caught playing a game of endless musical chairs, led by me getting a huge number of lightning round calls about some very sketchy outfits that all belong to what I call the hot money segment.”
Cramer provided insight into this hot money segment, describing it as a segment with limited capital that cannot satisfy all the demand. He specifically pointed to China, explaining that the current policies from the Chinese government have created an environment where, for the moment, it seems nearly impossible to incur losses. He elaborated that the government is actively subsidizing stock purchases and promoting buybacks and insider buying through liquidity support.
It has led to significant price movements in the market. When considering investments in Chinese stocks, Cramer advised caution, suggesting that investors should focus on companies capable of withstanding market fluctuations. He pointed out that many people are tempted to buy Chinese auto stocks, especially given their impressive advancements in electric vehicle technology. Nonetheless, he warned that the electric vehicle market is becoming increasingly saturated.
Cramer added that with the limited amount of hot money available, speculative stocks now face competition from cryptocurrencies. He expressed his belief that Bitcoin and Ethereum are the only cryptocurrencies with a good chance of recovery, dismissing most others as “junk”.
He shared that he only invests in these two digital currencies and avoids common stocks tied to the cryptocurrency market, deeming them too risky compared to Bitcoin and Ethereum, which benefit from exchange-traded products backing them. Cramer concluded by mentioning that speculation should be done wisely, saying, “With any speculative trade, there’s a beginning and an endpoint.”
Our Methodology
For this article, we compiled a list of 15 stocks that were mentioned by Jim Cramer during the lightning rounds of his episodes of Mad Money on October 4 and October 7. 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).
Cramer Says To Stick With New Fortress Energy Inc. (NASDAQ:NFE)
New Fortress Energy Inc. (NASDAQ:NFE)
Number of Hedge Fund Holders: 20
New Fortress Energy Inc. (NASDAQ:NFE) runs as an integrated gas-to-power energy infrastructure company, providing energy and development services on a global scale. The company engages in various activities, including natural gas procurement, liquefaction, shipping, logistics, and the establishment of natural gas-fired power generation. It also supplies floating storage and regasification units (FRSU) and liquefied natural gas (LNG) carriers for lease to customers, facilitating efficient energy distribution. Cramer expressed shock at how low the company’s stock was, mentioned the 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.”
Recently, New Fortress Energy Inc. (NASDAQ:NFE) faced challenges that disappointed investors during its second-quarter earnings release. The company missed its guidance significantly due to delays in bringing a new floating LNG facility into service. Although this facility was reportedly operational as of July 19, the preceding delays raised concerns regarding impending debt maturities.
At the close of the last quarter, it reported over $7.6 billion in debt against only $133 million in cash. Management has projected adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.3 billion for 2025, which shows cautious expectations for future performance.
Overall, NFE ranks 11th on our list of stocks discussed by Jim Cramer during the latest lightning rounds. While we acknowledge the potential of 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: $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.
