We recently published an article titled Jim Cramer Thinks These 13 Stocks Will Benefit From the New Administration. In this article, we are going to take a look at where Chart Industries, Inc. (NYSE:GTLS) stands against the stocks that will benefit from the new administration according to Jim Cramer.
Jim Cramer, the host of Mad Money, recently raised concerns about the current state of the market, particularly highlighting what he perceives as signs of “excess”. He also examined what he referred to as “Trump trades,” or stocks that Wall Street has been gravitating towards in anticipation of what President-elect Donald Trump’s administration might bring.
He pointed to private prison operators and oil service companies as examples of sectors benefiting from these expectations. Focusing on oil, Cramer noted that a number of smaller oil service stocks have surged this month. He pointed out:
“Now one of the few things that we know for certain about President-elect Trump’s economic agenda is that he wants our country to produce even more oil than it’s doing. His new pick for treasury secretary, that’s Scott Bessent, has advocated for the country to produce an incremental 3 million barrels of oil per day.”
READ ALSO Jim Cramer’s List of 7 Energy Stocks for the Trump Trade and Jim Cramer’s Game Plan: 13 Stocks in Focus
Cramer sees this as positive news for oil service companies involved in the extraction of resources. However, he also warned that this surge in production could exert downward pressure on oil and gas prices, much like what occurred in 2016. Despite this, Cramer highlighted that the major players in oil services have posted impressive gains in November, with some smaller operators making unexpected appearances on the list of the market’s hottest stocks. Shifting to the cryptocurrency market, Cramer addressed the significant rise in Bitcoin’s value. He noted:
“Now that rally is taking up practically the whole cryptocurrency ecosystem… Obviously, the gains in crypto, especially the Bitcoin ecosystem, seem excessive, but again, they aren’t without reason. We’re going from a Biden regime that was pretty antagonistic towards crypto to a second Trump administration that promised to be incredibly crypto-friendly.”
Cramer also pointed out that under the Biden administration, the government had been more paternalistic, aiming to regulate and control crypto, while Trump has promised a much more supportive stance towards Bitcoin. Cramer believes that a Trump administration that actively supports Bitcoin could lead to significant hoarding of the cryptocurrency, especially in the context of a strategic Bitcoin reserve.
This could benefit Bitcoin holders or “hodlers,” as they are often called in the crypto community. He also suggested that owning Bitcoin or an ETF that tracks its performance could serve as a hedge against potential inflation, particularly if the government continues to print money to address its deficit. Cramer voiced his own support for Bitcoin, saying, “call me in favor of owning Bitcoin,” and also recommended purchasing Ethereum, which he owns, despite it lagging behind Bitcoin in recent performance.
“I’m a believer, but these are hedges for me, and if you’re hoarding crypto, be ready for the breakdown no one thinks can come.”
Our Methodology
For this article, we compiled a list of 13 stocks that were discussed by Jim Cramer during a recent episode of Mad Money on November 25. We listed the stocks in ascending order of their hedge fund sentiment as of the third quarter, which was taken from Insider Monkey’s database of 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).
An extensive industrial gas facility with many storage tanks.
Chart Industries, Inc. (NYSE:GTLS)
Number of Hedge Fund Holders: 40
Cramer highlighted that he recommended Chart Industries, Inc. (NYSE:GTLS) frequently when Mad Money was first started.
“Chart Industries makes highly engineered equipment used in the engineering and in the energy production process and it’s run up 57%. That’s the stock we used to recommend all the time when we first started the show. Once again, big moves there. I can’t say they’re unreasonable. These are three very profitable businesses, reasonable valuations. They’re about to face a much more benign regulatory environment.”
Chart Industries (NYSE:GTLS) designs, engineers, and manufactures equipment and technologies for processing gas and liquid molecules, providing solutions for industrial gases, LNG delivery, natural gas processing, and heat exchangers across various industries. In its third-quarter results, the company reported a performance that did not meet expectations, largely due to the timing of large, high-margin projects. However, despite this, it saw strong growth in incoming orders and an expansion in margins.
During this period, the company achieved a record gross margin of 34.1%, which was driven by successful cost synergies from its acquisition of Howden and other operational efficiencies. The company’s adjusted EBITDA increased by 53.9%, reaching $260.7 million, a reflection of its operational effectiveness. In addition, the company generated $174.6 million in free cash flow, which was primarily used to reduce net debt. This helped lower the company’s net leverage ratio to 3.04 by September 30.
Chart Industries (NYSE:GTLS) also highlighted significant orders from nuclear sector customers during the earnings call, including EDF of France. CEO Jill Evanko mentioned that the company is now serving the “new leader in the space” with its industrial fans. In addition to this, he said that the company provides critical equipment like gas circulators, fans, turbines, and air coolers to support SMR technologies.
Overall GTLS ranks 3rd on Jim Cramer’s list of stocks that will benefit from the new administration. While we acknowledge the potential of GTLS 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 GTLS 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.
