We recently published a list of Jim Cramer Recently Talked About These 5 Subscription Stocks. In this article, we are going to take a look at where Spotify Technology S.A. (NYSE:SPOT) stands against other subscription stocks that Jim Cramer recently talked about.
On Monday, Jim Cramer discussed the insights of chartist Bob Lang, who expressed an optimistic view about a number of subscription-based stocks. Mad Money’s host said:
“Of course, the one thing we don’t have in this environment is any sense of certainty and when the fundamentals are uncertain, I like to fall back on the technicals and that’s why tonight, we’re going off the chart with the help of Bob Lang.”
Cramer pointed out that in today’s unpredictable market, where the fundamentals often lack clarity, he tends to rely on technical analysis and this is where Lang’s expertise comes in. Cramer explained that Lang, who founded ExplosiveOptions.net and authored Know Your Options, is known for his ability to read charts and identify promising stocks.
READ ALSO: Jim Cramer Focused On These 9 Stocks Recently and Jim Cramer Talked About 7 Stocks & Stagflation Fears
The focus of Lang’s analysis was on consumer-oriented companies that can still perform well, even when economic conditions slow down. According to Lang, businesses with strong subscription models are particularly appealing in such an environment. Cramer echoed the sentiment, saying he has always been a fan of subscription-based models and fully agreed with Lang’s perspective.
Cramer also turned his attention to several technical indicators that can help predict potential changes in a stock’s direction, specifically the Moving Average Convergence/Divergence (MACD). He explained that it is a tool that technicians, like Lang, often rely on. Cramer explained that the MACD is a powerful momentum indicator, capable of identifying shifts in a stock’s trajectory before they occur. By acting on these early signals, investors can position themselves ahead of potential price movements. Another important tool Cramer mentioned was the Chaikin Money Flow, which tracks the buying and selling pressure of a stock, providing further insight into a company’s potential performance.
Our Methodology
For this article, we compiled a list of 5 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 24. 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).
A person wearing headphones listening to an audio streaming service.
Spotify Technology S.A. (NYSE:SPOT)
Number of Hedge Fund Holders: 101
Cramer shared that Lang observed Spotify Technology S.A. (NYSE:SPOT) recently tested its 50-day moving average, only to bounce back with a solid increase in volume. He went on to say:
“Then the stock’s MACD line has already made that crossover that we like so much. See that right there? They’re all about to do this. That’s one of the most reliable signs of the business. Lang says Spotify is now building a base at a higher level.
It started trading sideways, but in this view that often means the next move will be in the same direction as the previous move, which means it’s going higher. Spotify’s Chaikin Money Flow, not bad, right? Still positive. In fact, it’s been positive since November. Even the big sell didn’t scare the big money away from Spotify. With the stock’s recent rebound, it broke a key downtrend line and rose above its ceiling resistance on healthy volume… Lang sees it, the big institutions are still buying this thing and he wouldn’t be surprised if this $600 stock makes a run at $700. Good story. I remember it was like in the $300. That’s amazing.”
Spotify (NYSE:SPOT) provides audio streaming services through subscriptions, allowing users to enjoy a broad range of music and podcasts.
Overall, SPOT ranks 5th on our list of subscription stocks that Jim Cramer recently talked about. While we acknowledge the potential of SPOT 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 SPOT 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.
