In his latest appearance on CNBC’s Squawk on the Street, Jim Cramer analyzed the extraordinary market turnaround following President Trump’s unexpected 90-day tariff reprieve. Cramer explained just how abruptly the momentum changed:
“The word that I kept hearing about is failed, that it would be a failed auction. It wasn’t. And therefore, it was a save. Once that save was made, in part because what the president did, you overrun what was the easiest trade of the year, which was the short Mag 7, short technology, short semiconductors, and everything reversed. Now, see, today, if you’re short – and the shorts are more or less the motif – they’re feeling good because it’s down, but they’re going to cover. They’re going to cover because they got hurt so badly yesterday that their bosses are saying, we want your books more. That’s historically what happens in these situations. So you may see all these down, but they’re not going to go back to where they were because we’re building in estimate cuts for everybody. And once they’re all built in, then it’s like 87. They’re all built in, and then you got to start figuring out. He was building too low.”
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He also painted the market as a high-stakes showdown between short sellers and bulls, warning that the tide may have turned decisively:
“It’s a great day for the longs, bad day for the shorts. […] What I’m talking about is that it’s a battle between longs and shorts. And the shorts are trying to keep their jobs after being victorious for so long. And the longs are revelling in what happened here because the 10%, except for, of course, what you talked about, which is the embargo.”
Finally, Cramer credited a single Trump tweet with flipping the entire market narrative:
“Yes, we are, given the fact that we should be in a hot seat estate, which is, we’re on a recession territory, ground, so whatever you want to say, until the tweet. Is that not insane? That a tweet came out and we went from being a recession to being up. […] The guy gave you the best call I’ve seen in my career, and yet there are people who are critical of that. I mean, come on. He got the Nasdaq to have the greatest single day ever, and he let you in. How many strategies have that kind of power? […]
We have to acknowledge that it was one of the greatest rallies in history. I should have said that right up front. And you were allowed in it. You got the call.”
Our Methodology
To make our list of the stocks that Jim Cramer talked about, we listed down the stocks he mentioned during CNBC’s Squawk on the Street aired on April 10th.
For these stocks, we also 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
8. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund holders: 115
During a discussion on the impact of tariffs and the need for domestic manufacturing, Jim Cramer emphasized the importance of building supply chain resilience within the United States. He used Eli Lilly and Company (NYSE:LLY) as a prime example of how American companies can execute rapid and efficient factory construction in response to geopolitical and trade-related risks. Here’s what he said:
“Let’s talk about building a factory. Eli Lilly built the fastest factory I’ve ever seen. It’s a North Carolina factory in Concord. It was supposed to take about five years, typically. They did do it in two and a half years, but they’re a pretty well-run company. Two and a half years is record time, sir.”
7. Constellation Brands, Inc. (NYSE:STZ)
Number of Hedge Fund Holders: 51
While talking about earnings reports, Jim Cramer focused on the weakness in alcohol consumption and a surprising slowdown in beer demand. Cramer used Constellation Brands, Inc. (NYSE:STZ) as a case study in this changing consumer behavior. Here’s what he said:
“A rather shocking guide down. Beer will be flat no longer 7% to 9% two years. They got Modelo, which is the number one brand. What this says is, without a doubt, that alcohol continues to slow. Consumption continues to slow. We don’t know. Now, this company over-indexed for Hispanics. There’s always a chance that perhaps Hispanics are unfortunately laying low because of what’s ever happening in our country. That’s what’s happened before. But what’s more important is GLP-1. The craving for beer is no more than the craving for sparkling water. So I’d rather have a sparkling water. There’s big studies going on right now that show that. And no one in the industry is willing to admit it. […]
So for me to just say, you know what, people have decided, I don’t like the taste of that, no. There’s no craving. And I think that when you look at these beer numbers from Constellation and you see what’s happening to the deterioration in their numbers, you understand why this stock is down. […]
[Asked about whether they were hit by any tariffs on Mexico] No, they’re going to be OK. They’re going to be all right. But what matters is consumption, and consumption is not good. Now, once again, no one in the industry will admit what I just said, but I’m in the damn industry, so I don’t really care what they said. That’s what I do for, well, it’s what my wife does for a living. I see the numbers of these other kinds of alcohols, and they’re shocking.”
