We recently compiled a list of the Jim Cramer Latest Stocks: 23 Stocks He Just Talked About. In this article, we are going to take a look at where Best Buy Co., Inc. (NYSE:BBY) stands against the other stocks Jim Cramer recently talked about.
With the Federal Reserve’s December meeting over, Wall Street has now shifted into a new paradigm. While the central bank did cut interest rates by 25 basis points in a widely anticipated move, the bank also signaled that 2025 might be accompanied by fewer interest rate cuts than many might have anticipated. In fact, not only are markets convinced that the Fed will cut less in 2025, but some even believe that the interest rates might be hiked especially since the central bank’s median 2025 inflation outlook is 2.5% which is higher compared to the earlier 2.1%.
While the Fed’s announcements and the press conference sent the flagship S&P index by 3.2%, Jim Cramer explained how the stock market as a whole isn’t doing that well. On the episode of Squawk On The Street the day of the interest cut, he stated “Look at the material stocks, look at anything related to industrial export. Look at the housing stocks. David, there are cohorts that are indeed rolling over. It isn’t like everything is just super strong and everything is quantum computing and Rocket Lab!”
Cramer added that while some believe that sections of the economy such as retail are strong, there might be a need to look deeper. “Look there’s this growing consensus not represented necessarily in these Fed fund futures but that just says why are they doing this? And I come back and say why are they doing this,” said Cramer, adding “So I think that the talking heads, and boy are there ever a lot of talking heads, have decided that look that if you look at what we’re seeing in some retailers, things are strong. By the way in retail, it’s not strong either if you count colds.”
Going against the trend, he stressed the need to look into the data to find the right stocks. According to him, “I don’t know where these people get that things are strong, they look at the aggregate numbers, I look at the individual companies, I am trying to find companies that are strong.” Cramer was also perplexed by the Atlanta Fed’s Q4 3.2% GDP growth estimates. He shared that he’s “trying to find why. I’m trying to find where that is. You know David that travel’s very strong yeah. Leisure’s very strong. Dining out’s very strong. These are strong and by the way, they’re very obvious, they look obvious to the Atlanta Fed. I don’t know what kind of weighting they have but wow.”
The American economy wasn’t the only economy on Cramer’s mind. While he might be having a hard time believing the GDP estimates, there isn’t a doubt in his mind that the US is the best place to invest. Cramer shared that he’s “trying to find countries, maybe Argentina making a comeback, but it’s very difficult to find a country that I would invest in,” but it’s very difficult to “find a country that isn’t upset in turmoil or something.”
Speaking of other countries, Cramer believes that China “is behind so much of what’s going wrong. But they are never, other than [BY] Peter Navarro, called out.” On how the “media and other coverage says that China is in a depression,” Cramer has “to believe it because I don’t believe a single number they send. We used to be able to look at their electric power. . . . .how about when they used to do employment of youth.”
One economic sector that he’s worried about is the automobile industry. Cramer doesn’t “understand why the problems with autos are not so visible among the cognoscenti,” something he believes is very important since autos “is a huge industry. Employs a lot of people. And the layoffs and the ramifications of what could happen here and other mergers.” China is “getting away with murder, they really are, they’re getting away with wiping out industries all over the world,” Cramer said, adding that “there’s only one guy who actually stands up them, and even he was saying that he has a good relationship with Xi. And that is President-elect Trump.”
However, on an optimistic note, Cramer believes that the “Mag 7 seems almost immune even to China. Which they never really got into.”
Our Methodology
To make our list of the latest stocks on Jim Cramer’s mind, we made a list of the stocks he talked about during a fresh episode of CNBC’s Squawk In The Morning.
For these stocks, we also mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds invest in? 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 busy retail store showcasing a wide range of consumer electronics.
Best Buy Co., Inc. (NYSE:BBY)
Number of Hedge Fund Holders In Q3 2024: 37
Best Buy Co., Inc. (NYSE:BBY) is a technology and appliance retailer that sells smartphones, computers, kitchen appliances, and other associated products. The retailer is dependent quite a bit on consumer spending strength as its product catalog is pricier than other retailers. Lower consumer spending has driven Best Buy Co., Inc. (NYSE:BBY)’s narrative throughout 2024 as the firm has turned to margin-unfriendly promotional pricing and cost efficiencies to drive bottom-line profit. This strategy yielded results in August when the stock soared by 15% when it upgraded its fiscal year EPS guidance ranging between $6.10 and $6.35 from an earlier $5.75 to $6.20. However, these are simply stop-gap measures as Best Buy Co., Inc. (NYSE:BBY) fell by 9% in November after its US comparable sales shrank by 2.8% for a hefty miss of analyst estimates of 0.28%. Here’s what Cramer said about the retailer:
“Street’s turning positive on Best Buy which has been a decent stock for me but uh people are talking about Evercore’s got a good rationale, holiday survey is looking good, shopping indicators are positive. Now this is a company that, uh, when they reported their quarter, did not give you the kind of guidance that I would have wanted, and the stock came all the way back down. It went up back to a hundred. But if the really optimistic move says the prices are similar to Amazon, maybe there’s a chance. I’m going to talk about it tomorrow in my investing club meeting, and Carl I’m basically saying listen the AI PC did not work out. It does need [inaudible] slower, appliances are not selling as well. But this is another example where you would read they’re and how they’re doing, and [LOOKING] forward . . the headwinds you would say look, they need to cut to get to, there’s homes to be built and there’s stuff to be, um homes to be remodeled and that’s really how they make the money. So this is two positive pieces on BestBuy, surprised that we can get two.
“I like Cory Barrett very much but we did get let down by the AI PC which is proving so far to be just a plain out disappointment.”
Overall BBY ranks 20th on our list of the stocks Jim Cramer recently talked about. While we acknowledge the potential of BBY 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 BBY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article is originally published at Insider Monkey.
