In this piece, we will look at the 13 stocks that Jim Cramer discussed recently.
As the Federal Reserve exits the year by having continued its interest rate cuts, Wall Street is wondering what 2025 will hold for markets. Inflation is a key concern among investors, and many believe that the Fed might have to update its models that determine the rate cuts. This update will account for any potential uptick in inflation and one which might be spurred by tariffs imposed by the incoming Trump Administration.
In a fresh episode of Squawk on the Street, Cramer commented on what might happen once the interest rate cuts intensify and how these effects might tie in with Trump’s strategies. Cramer doesn’t “understand that people want to be very concerned about the future after the cut, I really am not buying any of this.” According to him if the tariffs go through then the CPI can rise which will lead the Fed to not cut interest rates. But, if the tariffs don’t materialize or if “they’re targetted tariffs, and we get break in housing, I mean we just saw Tol Brothers, I know it’s only one million dollar house and not a hundred and fifty, but it starts somewhere. And we get some more apartments come in and we have big inventories from more than Ford.”
In the event the CPI rises, Cramer believes that “A year we’ll be sitting here and saying well, okay we had this blip up inflation but that’s over.” As a result, he believes that it is important to focus on “what the President-elect is gonna do. Why do we have to focus so much on what’s going to happen next year for the Fed when they actually have to react to what the President does?”
Cramer also believes that the US needs more workers. Commenting on Japanese billionaire Masayoshi Son announcing $100 billion in investments at Trump’s Mar-e-Lago resort, Cramer stated “I think the most important thing is we don’t have the workers for this stuff.” He added “The idea that we get the workers, and we do not have a good birth rate, robust birth rate, we do not have enough workers, we’re gonna have immigration reform. You know you wanna create jobs, what you need are people to fill them and we don’t have it.”
Another matter that’s caught Cramer’s attention when it comes to the President-elect is Trump’s remarks about taking on healthcare benefit managers once he assumes power. During a press conference at Mar-e-Lago, the President-elect shared that Americans were “paying far too much,. . . .much more than other countries” for healthcare. He added “We have a thing called the middle man, you know, the middle man right? The horrible middleman that makes more money frankly than the drug companies. And they don’t do anything except they’re a middleman.”
Trump says that his team will “knock out the middle man [AND HE’S] going to be very unpopular after that.” According to Cramer, “I think that what, if President-elect Trump follows up about knocking out the middleman, he will. He will because these companies will eventually lose their support in Congress,” as “when you have that kind of come together over them, you don’t wanna be in that business.”
Cramer commented on the impact the President-elect’s comments had and can have on the pharma benefits management industry. According to him “these companies are not, uh, without their friends. And by the way, they all resent the middlemen. Cardinal’s had a lot to be able to be a little bit more forward about what can be done. McKesson is considered to be a company that has done a lot to be able to make it so smaller drug stores get product.” Craner added that “the drug will all give you some great data which shows you that they are not the cause of the inflation. But they always are willing to finger, uh, United Health,” and as for the environment surrounding healthcare benefit managers, “right now, I’ve never seen it this bad for them.”
Our Methodology
To make our list of stocks that Jim Cramer is talking about, we listed down stocks he commented on during a fresh episode of CNBC’s Squawk on the Street.
For these stocks, we also mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds invest in? 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).
13. Nucor Corporation (NYSE:NUE)
Number of Hedge Fund Holders In Q3 2024: 32
Nucor Corporation (NYSE:NUE) is a North Carolina-based industrial products firm that makes and sells steel and iron items. The firm’s shares have lost 29% year-to-date as a glut in the steel industry has led to minimal demand and a drop in prices. Nucor Corporation (NYSE:NUE)’s hypothesis is built on a recovery in building and industrial activity in America. Higher activity typically stems from lower interest rates as mega projects and industrial manufacturing chains need large amounts of capital to kickstart their operations. Cramer’s remarks for Nucor Corporation (NYSE:NUE) covered its mid-quarter guidance, and he wasn’t impressed by the data release:
“Nucor is the biggest and the best. I do wanna say that we always keep hearing that there’s nothing that indicates that there is weakness. And that’s cause we’re not looking hard enough. Nucor does an intra-quarter, uh, rundown of what they are and they took their numbers down rather dramatically today. They are, I am in shock to some degree how much. Nucor expects fourth-quarter earnings to be in the range of 55 to 65 cents. Nucor reported net earnings of $1.05 share in the third quarter 2024. So you can see how it is just declining so rapidly. Now you can say well that’s because of Mexican imports. I don’t care. The price of steel is coming down. And now here’s something that I didn’t like. They bought 13 million shares at an average price of $168, $122 [CURRENT SHARE PRICE], so they got that wrong.
“Well there’s weakness in steel. Now steel is only, it’s not only about a hundred thousand people employed anymore in steel. But steel does matter. It shows that there is some weakness, somewhere. You also say look, China is flooding the world with steel. Because they don’t know what to do with it.”
12. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders In Q3 2024: 58
PepsiCo, Inc. (NASDAQ:PEP) is one of the two major consumer beverage players in the world. Its hypothesis is dependent on high volumes, raw material prices, logistics, and pricing power. PepsiCo, Inc. (NASDAQ:PEP) has to deliver on all these fronts to generate value, especially in today’s era where cooling inflation limits the firm’s ability to raise prices and grow top-line sales. However, its brand strength and global strength make it a classic staples stock that investors rush for safety. Cramer’s comments surrounding PepsiCo, Inc. (NASDAQ:PEP) also included this facet as he linked the stock with the Fed’s interest rate policy:
“Watch things like PepsiCo. That’s where the money should be going today. So people are going to start thinking. Oh they’re not gonna cut, after? Well that means the economy going to slow, so we gotta buy things that are doing well on a slowdown. Because that’s how stupid this market is.”
11. Teva Pharmaceutical Industries Limited (NYSE:TEVA)
Number of Hedge Fund Holders In Q3 2024: 61
Teva Pharmaceutical Industries Limited (NYSE:TEVA) is a diversified pharmaceutical company with a presence in the generic, specialty, and other drug markets. Portfolio diversification enables the firm to fire on all fronts and simultaneously profit from high-volume generic medicines and higher prices specialty drugs. Consequently, during the first 11 months of the year, Teva Pharmaceutical Industries Limited (NYSE:TEVA)’s shares gained 57% as the firm’s schizophrenia, migraine, and generic drug sales all jumped by either double or triple-digit percentages. For Cramer, the firm’s under-development drug for ulcerative colitis and Crohn’s disease is all the hype as he commented:
“Intractable disease [ULCERATIVE COLITIS AND CROHN’S] people have had some struggles with it, there are drugs out there that right now, they are so expensive, this would be a major break in inflation in the system. And they’re going right to three, and I thought it was very encouraging.”
10. The TJX Companies, Inc. (NYSE:TJX)
Number of Hedge Fund Holders In Q3 2024: 63
The TJX Companies, Inc. (NYSE:TJX) is an off-price retailer that sells a variety of products such as apparel, furniture, and food. Its shares have performed well in 2024. They are up 32% year-to-date, primarily due to tighter consumer spending helping volumes at off-price retailers. However, as The TJX Companies, Inc. (NYSE:TJX) has continued to beat analyst quarterly estimates in 2024, the pressure is high on the firm to maintain its growth trajectory. This was clear after the firm’s third-quarter earnings that saw its midpoint fourth-quarter EPS guidance of $1.13 sit below analyst estimates of $1.18. EPS is important for retailers as it lets them post margins that are key drivers of profitability in a volume-heavy industry. Here’s what Cramer had to say about The TJX Companies, Inc. (NYSE:TJX):
“Okay, let’s talk about TJX. . . And I think it’s breaking out, I did a lot of work on TJX, last few days, it’s $125 going to $140. So there, okay. It was a Segway to a great stock.”
9. CVS Health Corporation (NYSE:CVS)
Number of Hedge Fund Holders In Q3 2024: 63
CVS Health Corporation (NYSE:CVS) is a mega American healthcare plan provider. If you’d read the introduction to our piece, you’d understand how and why it’s operating in a vastly different environment now than earlier this year. Benefits managers like CVS Health Corporation (NYSE:CVS) are under a lot of public and government pressure to meet customer demands for adequate coverage. They also depend heavily on Medicare and Medicaid coverage. Speaking of which, CVS Health Corporation (NYSE:CVS) is also undergoing a strategic shift in its Medicare Advantage business. The firm has faced a tumultuous 2024 after replacing its CEO and halting profit guidance after three consecutive quarterly cuts. Media reports have suggested that CVS Health Corporation (NYSE:CVS) is looking to split its operations to help battle high costs. Cramer pointed out some of the problems that plague the firm:
“CVS stock has just cratered, and then cratered, and cratered again.
“And CVS by the way is a great company. But CVS is part of the, viewed as being part of the problem of the cost of healthcare. And they have no friends. Whatsoever. And by the way when you go to CVS we all know what happens. Its just, you know, customer service, candy aisle, customer service. Yeah, I want to be able to say, to one of them down there, [inaudible] at CVS. I’ll try to get it open. I just didn’t want to hear customer service, candy aisle one more time!
“If you got to Amazon and they do what I think is going to be a huge number of same day, do want to go and wait for your?
“People at home do not watch us everyday and they need to know that these are things [inaudible] it’s existential. It’s the front of the store, in the back of the store. It’s existential, alright?!”
8. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Hedge Fund Holders In Q3 2024: 70
Bristol-Myers Squibb Company (NYSE:BMY) is a drug company that sells treatments for liver, nervous system, heart, and other ailments. The firm has performed well on multiple fronts in 2024. Not only has its existing drug pipeline continued to deliver results, but Bristol-Myers Squibb Company (NYSE:BMY)’s hypothesis is also driven by its schizophrenia medicine Cobenfy. Some analysts estimate that the drug can generate more than $10 billion in sales, and Bristol-Myers Squibb Company (NYSE:BMY)’s shares gained 8% over the next couple of days in September after the FDA approved the drug. Cramer is also optimistic about Cobenfy as he shared:
“We pulled the trigger for the charitable trust, can we talk about Thursday meeting, Bristol-Myers. Because this Karuna Therapeutics I think is the single best property out there and they bought it. They didn’t pay much, they’ll be able to make the $14 billion, they’ll be able to make it back. This is the first drug for schizophrenia and bipolar, not, no proof for bipolar but proof for schizophrenia. 30 years and it works. According to everybody.”
7. Marvell Technology, Inc. (NASDAQ:MRVL)
Number of Hedge Fund Holders In Q3 2024: 70
Marvell Technology, Inc. (NASDAQ:MRVL) is a semiconductor firm. It designs and sells products such as SoCs and ethernet controllers to the data center industry. The firm’s shares are up by a cool 85% year-to-date as they have been propelled by the market’s enthusiasm surrounding custom AI chips. While NVIDIA’s GPUs are the AI industry’s mainstay, they are costly and in short supply. These constraints have forced big tech to diversify its AI chip supply base, and along with Broadcom, Marvell Technology, Inc. (NASDAQ:MRVL) is one of the winners from this strategy. For Cramer, Marvell CEO Matt Murphy is another key part of its hypothesis. According to him:
“Matt Murphy is a very calm, very exciting triathlon, you know I’ll beat you no matter what, guy. And he kept trying to say it’s happening, the inflection is happening. I don’t think he got the word. So then he just went and bought a million dollars of the stock. In the market. . . and said listen, you don’t believe me? Here’s a million bucks. And that was his money put in okay. I’m canceling 10B, I’m putting in the Form 4. And that was the bottom! And that was a very important thing.”
6. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders In Q3 2024: 80
Pfizer Inc. (NYSE:PFE) is one of the most well-known drug companies in the world. Its shares haven’t performed well at all in 2024 and are down 8% year-to-date. Pfizer Inc. (NYSE:PFE)’s heft has also led to it accumulating significant debt. As of 2023 end, the firm’s long-term debt was $61.5 billion. Debt impacts the bottom line, and for firms like Pfizer Inc. (NYSE:PFE) this means that dividends suffer. As a result, the firm has spent 2024 spinning off its business to raise cash and retire its debt. It has also faced pressure from activist investor Starboard over costly acquisitions that haven’t yielded profitable drugs. Cramer’s comments surrounded Pfizer Inc. (NYSE:PFE) CEO’s strategy for a turnaround and its 2025 earnings projection as he outlined:
“That’s very impressive.
“And I, you know what I think that Dr. Bourla, he’s done a lot of good worldwide. He’s done many things that I think are very positive for healthcare. I think that the issue has been, what about the numbers? Can he make the numbers?
“You hope that Seagen pays off. They bought Seagen off, the old Seattle Genetics, a lot of people felt they paid way too much. I have felt that if Dr. Bourla is correct about his roadmap of what’s going to come out of Seagen, we will all say that you know what, he got the last laugh.”
5. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders In Q3 2024: 81
Johnson & Johnson (NYSE:JNJ) is a mega drug manufacturer that is one of the largest of its kind in the world. The firm is currently facing quite a bit of long-term headwinds from its talcum powder lawsuit which is estimated to cost it more than a billion dollars. Johnson & Johnson (NYSE:JNJ)’s diversified business allows it to run a steady ship despite a billion-dollar lawsuit. This was evident in the firm’s third-quarter earnings which saw it beat analyst revenue estimates of $22.2 billion by posting $22.5 billion. Johnson & Johnson (NYSE:JNJ)’s Medical Technology business is powering the firm these days. Its recent fight with Cigna, as highlighted in a WSJ report, also falls in tune with Cramer’s comments we mentioned in the introduction. That wasn’t all he had to say about Johnson & Johnson (NYSE:JNJ) though:
“Look, all the drug companies. Look at Johnson & Johnson. Triple A balance sheet, obviously has the talc litigation, that’s a problem. Has a problem with IRA. But this is a great, great company, and if you get that chart up, I think you’re going to say, wait a second, holy cow, I mean that’s a very very good company.”
4. PayPal Holdings, Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders In Q3 2024: 90
PayPal Holdings, Inc. (NASDAQ:PYPL) is a financial technology company that enables users to access alternative banking systems to make transactions. Its exposure to consumer payments means that the firm relies on economic health and spending to boost transaction volume for higher commissions. PayPal Holdings, Inc. (NASDAQ:PYPL)’s 400 million users worldwide not only provide the firm with a wide moat but also a sizable user base to monetize. The firm is currently leveraging user data to generate advertising revenue. Cramer believes that PayPal Holdings, Inc. (NASDAQ:PYPL) is one of the best plays in the financial technology sector:
“Well, I was going to give you one that, that David introduced me to, that is, I’m crowning the new king of fintech, Paypal. Breaking out here. No, no, Barclays just joined this and pattern says basically this is better than all the others. And I think, PayPal spewing cash, this guy Alex Chriss is doing a terrific job of, February meeting, everybody will know it then. Kind of like when Marvell, everyone should have known, when Matt Murphy goes and buys a million dollars worth it’s not idle.
“I just pointed out PayPal because I think it has much higher to go.”
3. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders In Q3 2024: 99
Tesla, Inc. (NASDAQ:TSLA), as always, is one of the hottest stocks on Wall Street. This is mostly due to the firm’s CEO Elon Musk, whose proximity with the incoming Trump administration has injected fresh life into the stock. While they had gained just 1.22% prior to the November election, since then, Tesla, Inc. (NASDAQ:TSLA)’s stock has added 90.8% to make the year-to-date gain sit at a comfortable 93%. The firm’s narrative is driven by relaxed rules around self-driving technologies as well as potential policies that impact its EV rivals harder than they affect Tesla, Inc. (NASDAQ:TSLA). Cramer is particularly impressed by the firm’s FSD platform:
“. . . .but I also believe that Tesla’s got the best data on Full Self Driving. And Tesla seems very close to President-elect Trump.”
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders In Q3 2024: 193
NVIDIA Corporation (NASDAQ:NVDA) has catapulted itself to becoming one of the most valuable chip companies in 2024. All of its gains are driven by GPUs catered specifically to compute artificial intelligence workloads. However, the high demand for these products has led to supply constraints. These constraints have created murmurs that perhaps NVIDIA Corporation (NASDAQ:NVDA) is vulnerable to alternate AI processors designed by Marvell and Broadcom or even by big technology players such as Amazon. Cramer covered these worries in detail, and he only partially subscribes to them. According to him:
“However, I think there are people who say you know what, I gotta get off this horse, it’s going down. There is not much more to it, David.
“I think you wait until, okay no, no one’s gonna want to hear this and I, you know I love the stock, but the next big data point is gonna be in the third week of March, when Jen-hsun Huang the CEO has a GTC conference. He talks about new reasons, new things that are going on in NVIDIA, what it means to have video going on, because I think video is big. Now do I think it’s going to go through to one hundred, I don’t think so but look, this is one of the great wins of all time. And I think the people just say you know what, I’m on the wrong horse Carl, I gotta be in Broadcom. And they don’t think that maybe it’s field bet, that Broadcom, Marvel Tech, and NVIDIA are all good because of the demand. We’re forgetting the demand.
“Now he [Marvel CEO] made this announcement about Amazon, I don’t think people realize what the Amazon announcement was basically saying was we’re going to use our own chips, we’re going to have custom silicon designed by Marvell, and we’re going to use NVIDIA too. And there is no, there is still no distance between NVIDIA from both sides. When I speak to Amazon, I speak to NVIDIA, no one is saying that NVIDIA is being displaced. Everyone is saying we can’t get enough of NVIDIA so we have to take action.
“NVIDIA is a stock that, as we used to say in the hedge fund world, a down stock. And we said why. Well, you know why, there are more sellers than buyers. But the fact is that the people who are selling NVIDIA right now David they don’t know the difference between Nivea cream and NVIDIA chips.
“Look, I’m comfortable with NVIDIA. This is what it does. This is what it does. And people don’t know that. They don’t understand NVIDIA.”
1. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders In Q3 2024: 202
Alphabet Inc. (NASDAQ:GOOGL) is one of the weakest big tech performers on the stock market in 2024. Its shares have gained a mere 41% year-to-date, and if we remove December’s share price performance, then the shares have gained 22%. Alphabet Inc. (NASDAQ:GOOGL)’s shares have added 15.7% so far in December, and these gains are driven by its Willow quantum computing chip. Willow took investors by surprise. According to Alphabet Inc. (NASDAQ:GOOGL), the chip can compute 10 septillion worth of computation of a traditional supercomputer in less than five minutes. To add to the hype, the firm has manufactured Willow itself to demonstrate an edge in quantum computing chip fabrication. However, Cramer pointed out other factors that will drive Alphabet Inc. (NASDAQ:GOOGL)’s hypothesis at least until it can make and sell quantum chips at scale:
“I know, we’re selling some into it because, because we don’t believe the hype.
“People are telling, they’re emailing me and they’re saying, look, this is going to be the big breakthrough in healthcare. People have obviously pivoted away from the last company to have the big breakthrough in healthcare which was NVIDIA.
“If you’re buying Google, if you’re buying it . . . it’s about YouTube and about Search and about the Justice Department.
“I’m a believer in Waymo, right, love it, but I also believe that Tesla’s got the best data on Full Self Driving. And Tesla seems very close to President-elect Trump.”
GOOGL is a stock Jim Cramer recently mentioned. While we acknowledge the potential of GOOGL 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 GOOGL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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