We recently compiled a list of the Jim Cramer’s Best Performers List: Top 10 Stocks. In this article, we are going to take a look at where NuScale Power Corporation (NYSE:SMR) stands against the other stocks on Jim Cramer’s list of best performers list.
On Wednesday’s Mad Money episode, Jim Cramer took a deep dive into ten stocks, each worth over $1 billion, that have seen significant growth this year. While acknowledging that many of these stocks are speculative, he emphasized that they still hold potential as smart investments.
Cramer suggested that when looking back on this year, two trends will stand out: a steady rise in the S&P 500, and a series of moves that initially seemed almost magical, but were grounded in reality.
Cramer also reflected on the common investment approach of sticking with index funds, noting that it is a popular strategy because it requires minimal effort. But, according to him, simply parking your money in an index fund might not be the best way to maximize returns. Instead, he argued that investors should consider individual stocks with unique characteristics, many of which are speculative since they offer opportunities for much larger gains.
Cramer criticized the tendency among experts to dismiss individual stock investments beyond index funds, saying:
“Far too often we become snobs when we talk stocks. So many experts think that if you venture past the index, you could fall off some sort of intellectual cliff. It makes any gains null and void. It’s as if the huge swath of points you could have gained simply don’t count. But that, people, is nonsense.”
READ ALSO Jim Cramer on Microsoft and Other Stocks and 10 Stocks on Jim Cramer’s Radar
During Wednesday’s episode, Cramer highlighted several stocks that have surged by over 200% this year, choosing to focus only on those with a market cap of more than $1 billion. He did clarify, however, that he was not endorsing these stocks, especially given how much they have already appreciated. Instead, his point was that speculative stocks, despite their volatility, have a valid place in an investment portfolio.
While they come with risks, a small stake in one of these stocks could outperform a much larger investment in an index fund. For Cramer, it is not about avoiding speculative stocks altogether, but recognizing their potential when balanced alongside more stable investments like index funds.
Cramer wrapped up by stressing the importance of considering these high-flying, speculative stocks and said:
“The bottom line: Let’s remember this list of frothy stocks and think of them the next time you’re about to ignore a stock for being too speculative because these names are often the epitome of speculating wisely, which can be the key for terrific long-term performance, of course, only when melded with index funds.”
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the episode of Mad Money on November 13 and listed the stocks in the order that Cramer mentioned them.
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).
A Nuclear power plant with all its safety & security protocols in place.
NuScale Power Corporation (NYSE:SMR)
Cramer acknowledged that NuScale Power Corporation (NYSE:SMR) is spending a lot to develop nuclear reactors but went on to say that it has the possibility of raising money. Here’s what he had to say:
“Finally, the best performer: Viewers are crazy for nuclear power, you know that, you hear it all the time, but how about NuScale… This one’s on the come, so to speak because it’s losing a fortune, developing the nukes of the future, so-called small modular reactors. Yet it’s so beloved that I bet it can raise a ton of money once it lands a big hyperscaler contract. I’m clearly not alone here, the stock… is up 659% for the year.”
NuScale (NYSE:SMR) is a company specializing in the design and sale of modular light water reactor (LWMR) nuclear power plants. These reactors are intended for a variety of applications, including electricity generation, district heating, desalination, hydrogen production, and process heat. The company’s work aligns with broader national energy goals, as the White House recently outlined a roadmap aimed at significantly expanding nuclear energy production in the U.S.
By 2050, the administration plans to “at least” triple nuclear energy production, adding 200 gigawatts of new capacity. This ambitious expansion is seen as a means to create jobs, enhance energy reliability, and contribute to achieving a net-zero emissions economy by mid-century. In this context, SMRs, which the company specializes in, are expected to play a key role. The U.S. government has recognized the importance of advancing nuclear energy, with particular attention given to the development of small modular reactors.
The White House’s energy roadmap even specifically mentioned NuScale (NYSE:SMR) under the plan to expand nuclear energy. In particular, it noted how the U.S. Nuclear Regulatory Commission (NRC) is reforming its licensing and permitting processes to facilitate the deployment of new reactors. The company has been a significant part of this process, with its SMR design becoming the first to be certified by the NRC.
Overall SMR ranks 10th on Jim Cramer’s list of the best performing stocks. While we acknowledge the potential of SMR 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 SMR 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.