We recently published a list of Was Jim Cramer Right About These 12 Stocks?. In this article, we are going to take a look at where Morgan Stanley (NYSE:MS) stands against other stocks that Jim Cramer discussed 6 months ago during his show on July 29, 2024, and examine whether he was right or wrong about those stocks.
Back then, Cramer was talking about the “great broadening” which he described as the event where every stock was rallying except for the large cap stocks. He said:
“This market is not experiencing a small cap rally, it’s experiencing a rally in everything else but the tech titans.”
He also pointed out that many small-cap stocks were being bought indiscriminately through index funds like the Russell 2000, the S&P Small Cap 600, and the S&P Mid Cap 400.
“The big institutions don’t have time to examine all these different small-cap stocks, they just buy the index itself as an entity because it’s still historically cheap, even after this rally.”
That’s the essence of the broadening—some real treasures and some real trash getting scooped up together. He then explained:
“The treasure being companies that do better when interest rates go down like when the Fed starts cutting.”
Unlike the cash-rich tech giants that don’t need lower interest rates, small caps benefit tremendously from falling rates. That’s why investors were selling their big-tech winners from earlier in the year and cycling into cheaper small-cap stocks.
Jim Cramer was particularly enthusiastic about this narrative back then and said that investors should “celebrate the market’s good breadth”.
Our Methodology
For this article, we compiled a list of 12 stocks that were discussed by Jim Cramer during the episode of Mad Money on July 29, 2024. We then calculated their performance from July 29th, 2024, market close to February 4th, 2025, market close. We have also included the hedge fund sentiment for the stocks, which we sourced from Insider Monkey’s Q3 2024 database of over 900 hedge funds. The stocks are listed in the order that Cramer mentioned them.
Note: This article covers Jim Cramer’s commentary from July 29, 2024, and does not account for any changes in his opinions regarding the stocks mentioned. Therefore, the commentary should not be mistaken for his latest opinions on any of the stocks that are mentioned.
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).
Morgan Stanley (NYSE:MS)
Number of Hedge Fund Investors: 56
A caller called in with a strong case for Morgan Stanley (NYSE:MS), highlighting strategic initiatives, strength in investment banking, and growth in wealth management.
Cramer wholeheartedly agreed. He pointed out that big IPOs and takeover deals drive Morgan Stanley higher, and he expects more of both in the near future, saying:
“When we do pieces about these big IPOs and we get a lot of takeovers, you’re going to see Morgan Stanley go higher and higher and higher.”
His view is that Morgan Stanley (NYSE:MS) remains a strong buy, especially if rate cuts fuel more market activity and he was spot on. The stock has soared by more than 33% since his comments.
Overall, MS ranks 3rd on our list of stocks that Jim Cramer discussed 6 months ago. While we acknowledge the potential of MS 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 time frame. If you are looking for an AI stock that is more promising than MS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
