We recently published a list of Jim Cramer’s Latest Thoughts on the Magnificent Seven. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOGL) stands against other magnificent stocks in Jim Cramer’s list.
On Monday, Jim Cramer, host of Mad Money, took a closer look at the current status of the Magnificent Seven stocks, offering insight into both their market positioning and how the White House’s stance seems to be shifting.
“First, I can’t be sure that Trump has changed, but I do believe that he’s never lost sight of the markets and he watches the business channels.”
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Cramer emphasized that his analysis is not political, rather, it is a “clear-eyed” assessment of what the president aims to achieve. According to Cramer, Trump is pushing for more jobs and manufacturing within the U.S., even if it means sacrificing access to cheap goods from overseas. Turning his attention to the Magnificent Seven stocks, Cramer said:
“Everybody knows the Magnificent Seven is not so magnificent anymore… But as I said over and over again, you simply can’t count these stocks out.”
He explained that these stocks still hold significant value despite their significant drops from their peak highs. For Cramer, these companies are not to be dismissed lightly. He mentioned that six of them are part of his Charitable Trust, making them especially relevant to his analysis. He noted that some serious damage had been done to the group.
As Cramer continued his commentary, he pointed out that analyst sentiment toward the Magnificent Seven has become more positive after a year of skepticism. However, he highlighted that only Amazon and Nvidia have truly favorable setups at the moment. For the others, it remains to be seen what the future holds. Regardless of their uncertain outlooks, Cramer noted one important factor common to all these companies: as their stock prices fall, they actually become more affordable.
“Their stocks actually truly do get cheaper as they go lower, and that’s more than I can say for many others that have held up well during this exceedingly difficult period.”
Our Methodology
For this article, we compiled a list of stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 24. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 234
Alphabet Inc. (NASDAQ:GOOGL) was mentioned during the episode, and here’s what Mad Money’s host had to say:
“First, alphabetically speaking, is Alphabet, less than 19 times earnings with the stock down from $207 to $167. This one seems to have the most problematic situation because it’s got a lot to lose in Google Search revenue that may not be offset by Gemini, its chatbot. I don’t know so who uses it? But Alphabet does have YouTube and YouTube’s crushing it and Google Cloud Services is kicking butt. I’m inclined to use today’s strength actually to sell the stock though, because there’s real earnings risk from Google Search.”
Alphabet (NASDAQ:GOOGL) was formed as the parent company after Google underwent a restructuring, with Google remaining primarily associated with its search engine. On Friday, during an episode of Squawk on the Street, Cramer commented:
“I do think that, you take a stock like Alphabet, there’s no good news, coming from Alphabet, so I don’t want to own Alphabet.”
Overall, GOOGL ranks 1st on our list of magnificent stocks in Jim Cramer’s list. 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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Disclosure: None. This article is originally published at Insider Monkey.
