In this article, we discuss the 10 stocks that Jim Cramer recommends selling.
A lot of growth investors are reeling from the aftershocks of the incredible crash in crypto markets over the past few days. Jim Cramer, the former hedge fund manager and the host of Mad Money on CNBC, has dubbed the collapse, which started on June 13, as “Crypto Monday” and warned that it might be the beginning of a “reckoning” in the digital currency market. Cramer, who has been bullish on the rise of coins like Bitcoin, and has invested his own money into the market as well, recently sold his ether holding, breaking even on the investment.
On June 13, Bitcoin, the most popular coin, tanked by close to 17% in a single day of trading. This sent the price of the digital asset to a 66% low compared to an all-time high reached in November 2021. Since retail investors, who have become an important market force in recent years, readily come to the rescue of the coin as it loses value, Cramer has questioned whether the same will happen again in light of the present market situation. He also added that the recent plunge was a “necessary cleansing of speculation” in the cryptoverse.
Cramer, who previously held bullish calls on popular growth stocks like Amazon.com, Inc. (NASDAQ:AMZN), Tesla, Inc. (NASDAQ:TSLA), and Apple Inc. (NASDAQ:AAPL), has also turned bearish on some businesses as inflation climbs and interest rates rise. Some of the stocks that Jim Cramer is bearish on include Enphase Energy, Inc. (NASDAQ:ENPH), Farfetch Limited (NYSE:FTCH), and Joby Aviation, Inc. (NYSE:JOBY). The former hedge fund manager has also outlined the importance of cash in a slowing economy, pointing to plunges in the stock market and the crypto world as examples to show why investors are flocking to it.
Our Methodology
These were picked keeping in mind the latest calls that Cramer made on these equities on his Mad Money show aired by news platform CNBC. An extensive database of around 900 elite hedge funds tracked by Insider Monkey in the first quarter of 2022 was used to identify the popularity of each stock among hedge funds. All the stocks mentioned in the article have a Sell rating from Cramer according to the Mad Money stock screener.
Jim Cramer Recommends Selling These Stocks
10. Portillo’s Inc. (NASDAQ:PTLO)
Number of Hedge Fund Holders: 3
Portillo’s Inc. owns and runs fast casual and quick service restaurants in the United States. The firm manages around 70 different locations spread across nine states in the United States. In response to a viewer question about his views on the company, Cramer said that would like to save the stock for later when it had come even lower, indicating that the downward spiral in the shares may not be over just yet.
On May 6, Baird analyst David Tarantino maintained an Outperform rating on Portillo’s Inc. stock and lowered the price target to $26 from $31, noting that the first quarter results of the firm were “mixed” and forecast a “tricky” second quarter for the firm.
At the end of the first quarter of 2022, 3 hedge funds in the database of Insider Monkey held stakes worth $82 million in Portillo’s Inc., compared to 15 in the previous quarter worth $198 million.
Just like Amazon.com, Inc., Tesla, Inc., and Apple Inc., Portillo’s Inc. is one of the stocks feeling the heat of an economic slowdown.
9. Bridge Investment Group Holdings Inc. (NYSE:BRDG)
Number of Hedge Fund Holders: 13
Bridge Investment Group Holdings Inc. (NYSE:BRDG) is a Utah-based investment firm that manages capital for over a hundred institutions spread across the globe. The former hedge fund manager gave the stock a Sell recommendation during the Lighting Round of his show on June 7. While answering a query about his views on the company, Cramer noted that he was still unsure what the company did, and in the present market environment, there was lots of room for error with the stock.
On April 12, Citi analyst William Katz maintained a Buy rating on Bridge Investment Group Holdings Inc. stock and lowered the price target to $24 from $25. The analyst also lowered the earnings expectations of the firm through 2024.
At the end of the first quarter of 2022, 13 hedge funds in the database of Insider Monkey held stakes worth $25 million in Bridge Investment Group Holdings Inc., up from 12 in the previous quarter worth $34 million.
Among the hedge funds being tracked by Insider Monkey, California-based investment firm Phase 2 Partners is a leading shareholder in Bridge Investment Group Holdings Inc. with 375,178 shares worth more than $7.6 million.
8. Annaly Capital Management, Inc. (NYSE:NLY)
Number of Hedge Fund Holders: 14
Annaly Capital Management, Inc. (NYSE:NLY) operates as a diversified capital manager. The journalist investor gave the stock a Sell recommendation during the Lightning Round of his show on June 8. In response to a viewer question about his thoughts on the company, Cramer said that he was not going to recommend the stock, even though he thought that the dividend of the firm was safe from the present market volatility, because he did not think there would be any capital appreciation.
On April 27, Barclays analyst Mark DeVries maintained an Equal Weight rating on Annaly Capital Management, Inc. stock and lowered the price target to $7 from $8, noting that “book values are expected to be down meaningfully for real estate investment trusts”.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Marshall Wace LLP is a leading shareholder in Annaly Capital Management, Inc. with 4.9 million shares worth more than $34 million.
At the end of the first quarter of 2022, 14 hedge funds in the database of Insider Monkey held stakes worth $72 million in Annaly Capital Management, Inc., compared to 21 the preceding quarter worth $63 million.
7. Indie Semiconductor, Inc. (NASDAQ:INDI)
Number of Hedge Fund Holders: 17
Indie Semiconductor, Inc. (NASDAQ:INDI) markets semiconductor products. The former Goldman Sachs employee gave the stock a Sell recommendation during the Lightning Round of his show on June 2. When asked what he thought about the consistent earnings beats of the company in the past few quarters in relation to the stock price, Cramer said that the firm should be “making a lot of money” and that he knew about a lot firms making a “ton of money” whose stock was “real cheap” as well.
On May 13, investment advisory Deutsche Bank maintained a Buy rating on Indie Semiconductor, Inc. stock and lowered the price target to $11 from $13. Analyst Ross Seymore issued the ratings update.
At the end of the first quarter of 2022, 17 hedge funds in the database of Insider Monkey held stakes worth $56 million in Indie Semiconductor, Inc., up from 15 the preceding quarter worth $78 million.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Soros Fund Management is a leading shareholder in Indie Semiconductor, Inc. with 4.3 million shares worth more than $34 million.
In its Q3 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Indie Semiconductor, Inc. was one of them. Here is what the fund said:
“Indie Semiconductor, Inc. is a fabless designer, developer, and marketer of automotive semiconductors for automated driver assistance systems, user experience, and electrification applications. Indie leverages its cross-domain semiconductor expertise in analog, processing and power chips to integrate multiple chips and capabilities into a single package and offer its customers lower cost products in a smaller form-factor. Indie Semiconductor, Inc. has strong market share in applications such as Apple CarPlay and ultrasonic parking assist with multiple contracts ramping in the coming quarters in applications such as advanced lighting controls, telematics, and electrification. The stock rose on increasing investor recognition of the longer-term opportunity for the company, especially in light of the current automotive semiconductor supply shortage. Semiconductor content in cars is expected to grow substantially over the coming decade as automated safety features and electrification penetrate an increasing percentage of vehicles.”
6. Rocket Lab USA, Inc. (NASDAQ:RKLB)
Number of Hedge Fund Holders: 19
Rocket Lab USA, Inc. (NASDAQ:RKLB) concentrates on developing rocket launch and control systems. It is headquartered in California. Cramer gave the stock a Sell recommendation during the Lightning Round of his show on June 2. Cramer outlined his opinion on the broader aerospace industry in general and noted that other companies like Raytheon Technologies were much better picks because they “make money and do good things”.
On May 17, Canaccord analyst Austin Moeller maintained a Buy rating on Rocket Lab USA, Inc. stock and lowered the price target to $16 from $28, noting that the firm had a “competitive edge relative to peers in the launch and smallsat manufacturing sectors”.
At the end of the first quarter of 2022, 19 hedge funds in the database of Insider Monkey held stakes worth $167 million in Rocket Lab USA, Inc., the same as in the preceding quarter worth $319 million.
In addition to Amazon.com, Inc., Tesla, Inc., and Apple Inc., Rocket Lab USA, Inc. is one of the stocks on the radar of hedge funds amid market volatility.
5. BlackLine, Inc. (NASDAQ:BL)
Number of Hedge Fund Holders: 23
BlackLine, Inc. (NASDAQ:BL) provides cloud-based solutions to automate finance operations. Jim Cramer gave the stock a Sell recommendation during the Lightning Round of his show on June 7. Answering a question about his views on the company, Cramer said that the firm was losing a lot of money and even though it might make some money next year, “we can just not go with it”. Cramer said he was toeing a hardline on this since the market was too hot for this kind of activity.
On May 6, JPMorgan analyst Pinjalim Bora maintained an Underweight rating on BlackLine, Inc. stock and lowered the price target to $70 from $75, noting that there was caution on the firm as it “switches gears and spends toward growth”.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Echo Street Capital Management is a leading shareholder in BlackLine, Inc. with 1.9 million shares worth more than $139 million.
In its Q4 2021 investor letter, Ensemble Capital, an asset management firm, highlighted a few stocks and BlackLine, Inc. was one of them. Here is what the fund said:
“Blackline’s stock was down, along with other high-growth Software as a Service stocks, during the quarter. While we believe that many of these types of businesses became very over valued earlier this year and their declines this quarter were justified, we think BlackLine, Inc. is worth materially more than the current market price. We will be discussing this company at length later in this letter. The stock finished the quarter down 12%.”
4. Allegiant Travel Company (NASDAQ:ALGT)
Number of Hedge Fund Holders: 24
Allegiant Travel Company (NASDAQ:ALGT) is a Nevada-based leisure travel company. The journalist investor gave the stock a Sell recommendation during the Lightning Round of his show on June 2. In response to a viewer question about his views on the stock, Cramer said that he would rather be invested in established travel stocks like Expedia or Airbnb than Allegiant.
In early April, Barclays analyst Brandon Oglenski maintained a Buy rating on Allegiant Travel Company stock and lowered the price target to $220 from $275, noting that fuel and labor expenses were climbing for travel firms.
At the end of the first quarter of 2022, 24 hedge funds in the database of Insider Monkey held stakes worth $230 million in Allegiant Travel Company, the same as in the previous quarter worth $293 million.
In its Q2 2021 investor letter, Wasatch Global Investors, an asset management firm, highlighted a few stocks and Allegiant Travel Company was one of them. Here is what the fund said:
“Allegiant Travel Company was also a large detractor. Allegiant offers airline flights, hotel bookings, car rentals, travel management and other related services. When the stock price declined in 2020, we performed more research on the company. Although other travel-related competitors were facing dire circumstances, Allegiant wasn’t forced to raise dilutive equity or take government money. Since then, Allegiant has strengthened its relationships with pilots and crews and has positioned itself to benefit from leisure travel—which should accelerate sooner than business travel. Although we didn’t purchase the company as a way to take advantage of the economic reopening, the stock did get a boost from economy-related optimism in the first quarter. During the second quarter, the stock simply gave back some of its gains but we still like the company’s fundamentals from a risk/reward perspective.”
3. Joby Aviation, Inc. (NYSE:JOBY)
Number of Hedge Fund Holders: 30
Joby Aviation, Inc. is an air mobility firm. Cramer gave the stock a Sell recommendation during the Lighting Round of his show on June 2. Cramer was sarcastic in his reply to a question about his views on the firm. He remarked, “You think it is time for flying cars?” and suggested that viewers should sell the stock.
On April 28, JPMorgan analyst Bill Peterson initiated coverage of Joby Aviation, Inc. stock with a Neutral rating and a price target of $7, noting that the early leadership of the firm in the EV space was generally reflected in the stock.
At the end of the first quarter of 2022, 30 hedge funds in the database of Insider Monkey held stakes worth $79 million in Joby Aviation, Inc., compared to 23 in the preceding quarter worth $134 million.
2. Farfetch Limited (NYSE:FTCH)
Number of Hedge Fund Holders: 45
Farfetch Limited is a UK-based firm that owns and runs an online marketplace for luxury fashion goods. Cramer gave the stock a Sell recommendation during the Lighting Round of his show on June 7. Cramer identified Target as a much better buy in the sector compared to Farfetch when asked for his opinion on the stock.
On May 27, Wedbush analyst Tom Nikic maintained a Neutral rating on Farfetch Limited stock and lowered the price target to $8 from $16, noting that the macro headwinds for the firm could have duration.
At the end of the first quarter of 2022, 45 hedge funds in the database of Insider Monkey held stakes worth $899 million in Farfetch Limited, compared to 47 in the previous quarter worth $2 billion.
In its Q1 2022 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Farfetch Limited was one of them. Here is what the fund said:
“We also initiated a position in global luxury fashion e-commerce marketplace Farfetch Limited in the first quarter and took advantage of meaningful weakness in the company’s share price during the period. Farfetch previously had too large a market cap for the Portfolio, but it has since moved to a level where it’s appropriate to own it – both in this Portfolio and in our smid-cap strategy. The company’s fundamentals remain attractive as indicated by the compelling results Farfetch reported in February.
The company remains an early mover with “the world’s only truly global marketplace for luxury at scale”. Farfetch Limited has broader reach around the world with a diversity of brands that is much larger than its competitors. Many of the items it sells are exclusive. Our research shows that its brand assortment, brand image, geographic breadth, an inventory-light business model, a more compelling offering for luxury partners, and artificial intelligence are all competitive edges for the company. We believe Farfetch is well-positioned for the continued market share shift from offline to online in this category. The personal luxury goods market has trailed other categories in online penetration, but consumer behaviors and preferences shifted as a result of the pandemic creating more comfort with purchasing goods like this online. Changed behavior and the general shift to a higher portion of Millennial and Gen Z luxury shoppers supports this continued shift as does the growth in emerging market demand.”
1. Enphase Energy, Inc. (NASDAQ:ENPH)
Number of Hedge Fund Holders: 57
Enphase Energy, Inc. markets home energy solutions and has operations across the world. Cramer gave the stock a Sell recommendation during the Lighting Round of his show on June 8. He claimed that the stock was too expensive and there were many “better stocks” in the sector to choose from.
On April 27, Craig-Hallum analyst Eric Stine maintained a Buy rating on Enphase Energy, Inc. stock and lowered the price target to $213 from $241, noting the broader multiple compression in the sector as one of the reasons behind the revised target.
At the end of the first quarter of 2022, 57 hedge funds in the database of Insider Monkey held stakes worth $749 million in Enphase Energy, Inc., compared to 50 the preceding quarter worth $763 million.
In its Q1 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Enphase Energy, Inc. was one of them. Here is what the fund said:
“Enphase Energy, Inc. is a key solar holding that should be able to take advantage of greater incentives for solar installations in many geographies. The company was also a strong contributor for the quarter, overcoming pressures of a higher discount rate on their strong projected future earnings, raw material inflation and supply chain challenges as their long-term value was reaffirmed.”
You can also take a peek at 10 Best Medical Stocks Under $10 and 15 Best Warren Buffett Stocks to Buy Now.
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This article is originally published at Insider Monkey.
