We recently published a list of Jim Cramer is Talking About 10 Falling Stocks Amid Latest Market Rotation. Since SharkNinja, Inc. (NYSE:SN) ranks 10th on the list, it deserves a deeper look.
Jim Cramer in a program last week tried to make sense of the decline in tech stocks, saying companies with the “best fundamentals” got “hammered once again.”
“I did not expect that to happen.”
Cramer said that sometimes it’s difficult to own the “winners.” The CNBC host said it’s important to understand the bear cases around stocks otherwise you will never know what “you are up against.”
Jim Cramer tried to find out whether the latest decline in top tech stocks was just a “periodic selloff” that presented an “opportunity.”
“When we get this kind of rotation, you never know whether these stocks are selling off because there’s something wrong or because they are up huge.”
Jim Cramer pointed to a caveat when it comes to holding winning stocks. When you have the losers, there are no profits, but when you own winners in your portfolio, you can see losses because people want to take some profits off the table, Cramer said.
The CNBC host said when top stocks go down, people holding those in their portfolios often end up thinking about whether they should also sell these stocks and if something has “changed.”
“From what I can tell you, nothing has changed about the stocks we are going talk about tonight. But it is true that the stocks are a heck of a lot more expensive than they were one year ago.”
In this program, we took a look at some top tech stocks that fell last week and explained the reasons they lost value according to Jim Cramer. We also discussed these companies’ fundamentals and hedge fund sentiment. 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).
A close-up photo of a robotic vacuum cleaner, highlighting its advanced design and home innovation capabilities.
SharkNinja Inc (NYSE:SN)
Number of Hedge Fund Investors: 57
Talking about appliances company SharkNinja, Inc. (NYSE:SN), here is what Jim Cramer said in a latest program:
“SharkNinja is a very very good company that I think is still coming down a little bit more because it has got a high price-to-earnings multiple.”
Cramer said that he wants SharkNinja “back on” to see how the company is doing before recommending the stock.
SharkNinja makes vacuum cleaners, air fryers, multi-cookers, coffee makers, cookware, food preparation appliances, blenders, juicers, etc. The company’s margins have improved significantly over the past few years as it focuses on recurring revenue streams and high-margin items. SharkNinja’s growth strategy is built on three pillars. First, the company is expanding into new product categories, adding 18 subcategories since 2021, including the Ninja FrostVault coolers and Shark FlexBreeze fans, which offer innovative features at competitive prices. Second, SharkNinja is boosting its presence in existing categories by launching 25 new products annually, 20 of which enhance existing lines like the industry-leading Double Stack XL air fryer. Third, SharkNinja is aggressively expanding internationally, entering six new countries in 2023 and expecting international growth to outpace domestic growth, with strong prospects in regions like Latin America and Europe. With a $120 billion total addressable market, SharkNinja is well-positioned to grow its less than 4% market share through this strategy.
The stock has a PEG ratio of 1.1, significantly lower than the 3.1 average for the Furnishings, Fixtures, & Appliances industry, indicating potential upside as the company grows.
Artisan Small Cap Fund stated the following regarding SharkNinja, Inc. (NYSE:SN) in its first quarter 2024 investor letter:
“Along with Iovance Biotherapeutics, notable adds in the quarter included SharkNinja, Inc. (NYSE:SN). We already mentioned emerging signs of consumer weakness, especially among those with lower incomes. We think this environment sets up nicely for companies that provide high-quality products sold at a discount to capture market share from their name-brand competitors. SharkNinja and e.l.f. Beauty are two examples. SharkNinja is a leading household consumer products company with the Shark and Ninja brands. The Shark brand focuses on the cleaning category (vacuums, mops, carpet cleaners, etc.) and more recently, beauty (hair dryers, hair stylers, etc.). The Ninja brand focuses on food preparation (blenders, food processors, ice cream makers, juicers, etc.) and cooking (indoor grill, ovens, toasters, cookers, air fryer, etc.). We believe a healthy combination of market share gains within existing categories, new category entries and international expansion will drive growth.”
Overall, SharkNinja, Inc. (NYSE:SN) ranks 10th on Insider Monkey’s list titled Jim Cramer is Talking About 10 Falling Stocks Amid Latest Market Rotation. While we acknowledge the potential of SharkNinja, Inc. (NYSE:SN) 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 SN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.