We recently published a list of Jim Cramer Says We’re Entering a Bear Market and Breaks Down These 10 Stocks. In this article, we are going to take a look at where AT&T Inc. (NYSE:T) stands against other stocks that Jim Cramer discusses.
On Friday, the host of Mad Money opened the show highlighting a new AI company’s IPO. During the discussion, Cramer shared his thoughts on what seemed like an underwhelming IPO and what this indicates about data center demand, as well as additional macro factors that are pushing the stock market lower in recent weeks:
“[Talking about decreased data center demand] When you couple that with the tariffs orchestrated by the president of the United States, you got a stock market that feels like a nuclear winter. In this kind of environment, you don’t need a weatherman to know which way the wind blows. Today the wind blew the radio activity from the Coreweave deal and the auto tariffs and sent it right in your face. Can the fall be wiped off before your portfolio is totally irradiated? You know what? I think we’ll find out next week once the radiation clears. But don’t get too excited. I’m not going to give you a real upbeat thing going here even though it’s supposed to be a nice day tomorrow in the east. You’re not going to feel pretty good after I read this, I’m just trying to tell you straight stuff.”
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Cramer then pointed to the sudden turn in sentiment against AI and tech, the once market darlings, as another troubling sign:
“For weeks I’ve been telling members of the CNBC investing club that tech’s suspect. We haven’t bought anything until today and nothing at all in tech because we see that the market’s turned against artificial intelligence, robots, autonomous driving, we have eyes. It’s even turned against the chat bots and it’s like nothing’s going to come back.”
The host of Mad Money did not sugarcoat the current environment, and he believes that investors should brace for more pain ahead. Here’s his analysis:
“If you’re a bull you want people to be prepared for everything the president can throw at the worldwide system of free trade, you have to believe that there will be no one left who thinks the tariffs won’t be worse than smooth hauling. That was a horrendous set of tariffs that helped usher in the Great Depression. […] The market’s beginning to believe that the president will stop at nothing to make his points on trade, and he won’t change his mind until all our trading partners are brought to heel. I believe that. And then maybe we bounce. I think some people might say that’s too dire though. As I see it we’re getting closer to the moment where President Trump recognizes the beating that people are actually taking in the stock market, but it’ll take time to get there because stocks have run so much in the last decade. If the decline gets bad enough, he’ll do something. I bet he’ll ease up on the tariff rhetoric. We aren’t there yet though. This is a bad place to be but it is not horrendous that’s the best I can say about it.”
Looking ahead, Cramer highlighted two major catalysts that could shake-up the market. Those are President Trump’s expected announcement of a new tariff regime on Wednesday (what he self-proclaimed as “Liberation Day”) and next Friday’s important March jobs report:
“Now we don’t have a lot of earnings next week, but we do have some two gigantic events and first Wednesday. That’s what the president’s calling ‘Liberation Day’, the day when he tells us that what the new tariff regime will look like to liberate ourselves from our trading enemies or whatever, and then second Friday labor department’s non-farm payroll figures for March. These are both really, really big days. Everything else is a little tiny but we’re going to deal with it anyway. Both of those have the potential to turn this market around. One because it will be great when we are past it, and the other because people think that inflation is about to rage. Finally on Friday we get the labor department non-farm payroll. Let’s speak about this now in light of the very inflationary tariffs and tariffs are immediately inflationary. The bulls have to hope this number shows slow job growth and no wage growth.”
Lastly, Jim Cramer closed off the opening segment of the show by calling the current market a bear market and answered the burning question whether investors should get out now:
“Given this market’s mood I think that anything that deviates from that panglossian scenario will trigger not just talks of stagflation but definitive chatter about a bear market. That’s where we are, okay? People are going to start talking next week that we are in a bear market, and it’s not going to be anymore about a correction; it’s going to be the absolute bear. Which brings me to the fatal question: is it too late to get out, or should we start thinking buying amid weakness? Now I can tell you that a couple real bad days does not make a bear market. It’s a nasty run. Doesn’t seem like it’s over. So why not do this: take the other side of the trade if you have some cash on the sidelines – I’d actually put a small amount of money to work – into the abyss of Tuesday, betting that things are going to be too negative for what we see on Wednesday. Then you can put more money to work on Friday if we get knocked down by an overheated labor report. The bottom line it’s not the end of the world; it just feels that way.”
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 28. 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).
AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 80
Jim Cramer highlighted AT&T Inc. (NYSE:T), the U.S. telecom provider, as one of the best performers of the S&P 500 this year. He noted its impressive year-to-date performance and the reasons behind its recent rise in popularity and impressive performance:
“Suddenly AT&T has been making a name for itself as a safe haven in a tough market and we don’t have many of those. When investors feel like the environment’s gotten really treacherous, they like to throw their money into something deemed safe. Telecom fits the safety criteria because it’s more insulated from the cyclical nature of the economy. Things have to get pretty darn bad before you stop paying your cell phone bill, don’t they? And also, because these companies tend to pay pretty good dividends.
So, what’s changed then to allow AT&T to become a winner this year? Well for starters this is no longer the old AT&T that we think about after spending years trying to diversify away from the phone business, which was ill-fated by the way, they finally decided to stick with what they knew best: phone business. Back in September AT&T told us they’re selling the rest of their stake in Direct TV – what a disaster that was – and that comes on top of the Warner Brothers spin-off a few years ago doesn’t hurt that the whole wireless business has gotten less competitive, and that’s allowing all three of the major carriers to steadily raise prices.
But the main reason AT&T stock got its mojo back is that management held an investor day in in December and they laid out a very clear road map with healthy growth expectations. It was a breath of fresh air for investors who might have bought this stock for years for the dividend but have seen those quarterly payouts cut.
At the end of January, they put an excellent quarter, good subscription numbers, strong free cash flow growth, and management raised their previous guidance that might seem like a low bar but in a negative market like this one, I think a little consistency goes a long way. But the most recent results indicate that AT&T has really turned the corner here.
So, here’s the bottom line here AT&T’s mainly roared this year as a higher yielding flight to safety trade, but there are also some company specific positives as the company’s gone a long way to turn itself around. At the very least, the stock’s no longer a value trap, which is why it’s been working this year and why I expect it to keep working as long as people are worried about the state of the economy.”
TCW Relative Value Large Cap Fund is positive on AT&T Inc. (NYSE:T) due to its strong management, successful restructuring, improved financial outlook, and commitment to sustainability. The fund stated the following in its Q3 2024 investor letter:
“AT&T Inc. (NYSE:T), based in Dallas, TX, is a nationwide provider of voice, video, and data communications services to businesses and consumers in the wired, wireless, and broadband. At initiation, the stock had a $141 billion market capitalization and met all five valuation factors with an above market dividend yield of 5.6%. From a sustainability prism, the company completed its commitment to invest $2 billion by the end of 2023 to help bridge the digital divide. AT&T is working on enabling low-income households to access to low-cost broadband services through its Access service plan as well as reaching out to more rural communities and Tribal lands where internet access remains a challenge. It is nearly 85% the way to providing one million people in need with digital resources through AT&T Connected Learning® with the goal to be reached by the end of 2025. In 2020, the company announced that it is committed to be carbon neutral by 2035 with zero carbon emission across all operations. It is deploying Smart Climate Solutions – through efforts like its Connected Climate Initiative – that will help enable its business customers to reduce their emissions as well. The company’s goal is to help collectively reduce its emissions by one billion metric tons – a gigaton – by 2035, compared to 2018 levels. The primary catalysts are new/strong management and restructuring. John Stankey was appointed CEO in July 2020 and he is committed to refocusing the company and improving its financial performance. The company combined its WarnerMedia operation with Discovery during 1Q:22 which eliminated AT&T’s exposure to the rapidly evolving media industry and refocused its core telecommunication business thus eliminating a major drag on profitability and the company’s balance sheet by reducing long-term debt from a peak $176 billion during 2020 to $142 billion at the end of June 2024 quarter. AT&T is moving aggressively to reduce cost and sell non-core assets such as its advertising platform Xander to Microsoft† which was accomplished during 2022. The company has redesigned its network to be software driven structure reducing the capital investment cycle in its national network – resulting in a network that is flexible with unrivaled speed and reliability – thus enhancing its nationwide position. By the end of 2023, it expanded its 5G network to reach more than 302 million people in nearly 24,500 cities and towns in the U.S. The company’s mid-band 5G+ network alone grew to cover more than 210 million people. AT&T is one of the largest investors in digital infrastructure in the U.S. Over the five years ending 2023, the company invested nearly $150 billion primarily in its wireless, fiber optics, and wireline networks. The extensive restructuring and refocusing of AT&T on its core business should result in improved earnings and cash flow while at the same time reducing uncertainty for shareholders.”
Overall, T ranks 6th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of T as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than T but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
