We recently published a list of Jim Cramer’s Latest Portfolio: 10 Stocks to Buy and Sell. Since RPM International Inc. (NYSE:RPM) 10th on the list, it deserves a deeper look.
Jim Cramer in a latest program discussed last week’s market selloff again, saying the notion the broader meltdown was because of “hard landing” fears is “totally false.” Cramer said that it was all related to the Japanese stock market and Yen, and “nothing more.”
“A bunch of money managers took advantage of how you can borrow against Japanese bonds which had a very low interest rate and then have relatively free money which you can put to work in stocks all around the globe, including here (the US),” Cramer said.
Jim Cramer said that small-cap stocks are “trying to come” back. However, he pointed to an “issue” with the small-cap rally. He said that no one actually bought individual small-cap stocks and instead loaded up on ETFs. Investors, according to Cramer, “walked away” when the broader market wavered.
For this article we watched the latest programs on Cramer recently aired on CNBC and picked 10 stocks he’s talking about. With each company we have mentioned the number of hedge fund investors. 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).
RPM International Inc (NYSE:RPM)
Number of Hedge Fund Investors: 25
When asked about RPM in a latest program, Jim Cramer said it’s a “great company.”
“I want you to own it,” said Cramer.
RPM International Inc (NYSE:RPM) makes specialty chemicals, providing a wide range of products including waterproofing systems, coatings, sealants, and adhesives for industrial, specialty, and consumer markets. RPM International Inc (NYSE:RPM) offerings span roofing and building maintenance to concrete repair and fire protection solutions, catering to diverse construction and manufacturing needs worldwide.
Since 2002, RPM International Inc (NYSE:RPM) has expanded its portfolio to include specialty paints, protective coatings, sealants, and adhesives, serving both industrial and consumer markets. With brands like Carboline and Rust-Oleum, RPM operates in approximately 164 countries and runs 121 manufacturing facilities worldwide. In the 12 months leading to Q1 FY 2024, RPM International Inc (NYSE:RPM) generated $7.3 billion in net sales.
RPM International Inc (NYSE:RPM) recently posted fiscal Q4 results in which revenue fell about 1% year over year. The company saw tremendous growth in the near past but analysts believe with revenue growth slowing and forward P/E of about 21, the stock is fairly valued.
JPMorgan last month downgraded the stock amid valuation concerns.
J.P. Morgan analyst Jeffrey Zekauskas highlighted that volume trends for DIY home improvement products, sold through major retailers, have been negative in the first half of 2024. He expressed skepticism about a rebound in demand in the second half, based on insights from paint and coatings companies as well as big-box retailers.
JPMorgan at the time said the stock was trading 15 times earnings before interest, taxes, depreciation and amortization for calendar-year 2024 and 14 times for calendar-year 2025.
“We think these multiples represent fair value for the shares,” JPMorgan said.
TimesSquare Capital U.S. Mid Cap Growth Strategy stated the following regarding RPM International Inc. (NYSE:RPM) in its fourth quarter 2023 investor letter:
“Within Materials, we seek well positioned companies that are less susceptible to swings in commodity prices. RPM International Inc. (NYSE:RPM), a producer of coatings, sealants, and building materials, gained 18%. Fiscal first quarter revenues and earnings topped consensus projections. Growth was led by business lines touching building maintenance, infrastructure, and plant spending while sales to Original Equipment Manufacturers were weaker.”
Overall, RPM International Inc. (NYSE:RPM) ranks 10th on Insider Monkey’s list titled Jim Cramer’s Latest Portfolio: 10 Stocks to Buy and Sell. While we acknowledge the potential of RPM International Inc. (NYSE:RPM), 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 RPM 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.