We recently published a list of Jim Cramer is Discussing These 10 Stocks Ahead of Q1 Earnings Season. In this article, we are going to take a look at where Discover Financial Services (NYSE:DFS) stands against other stocks that Jim Cramer is discussing ahead of Q1 earnings season.
Jim Cramer in a latest program on CNBC talked about the winning sectors so far this year and said the trends show a “strange” pattern. Cramer specifically mentioned the oil and gas sector which he believed would underperform given President Donald Trump’s plan to keep energy prices lower.
“I thought this group would be down given that the president wants to expand drill and we have a slower economy, but the stocks aren’t expensive and demand for natural gas very strong,” Cramer said.
Cramer also talked about healthcare and other key sectors that performed well. He believes these patterns show that investors are turning to sectors that perform well during recessions. However, Cramer thinks the state of the economy is better than feared.
“The seven stocks that make up the S&P are too big to dismiss. You need at least some of them to put together a really positive tape. But the bottom line, it’s terrific to see such a broad mixture of stocks winning here, from ones that can run in a recession to ones that can rally hard in a robust economy. What it tells me is that the market may be far healthier than we think, and this backdrop simply isn’t as bad as many would have you believe.”
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In
For this article, we picked 10 stocks Jim Cramer recently talked about during his programs on CNBC. 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Discover Financial Services (NYSE:DFS)
Number of Hedge Fund Investors: 69
When recently asked about Discover Financial Services (NYSE:DFS) during a program on CNBC, here is what Jim Cramer said:
“I’m betting that the Capital One merger is going to work. I know that there are a lot of people who this week said bad things about the merger. I’m sticking with Capital One, which means I’m sticking with DFS. I think the deal is going to occur. I could be wrong, but I believe that the likelihood is that it does.”
Turtle Creek Asset Management stated the following regarding Discover Financial Services (NYSE:DFS) in its Q4 2024 investor letter:
“Two other companies that contributed positively to the flagship fund’s returns during 2024 happened to be the two most disappointing for us in terms of decisions taken by boards: Discover Financial Services (NYSE:DFS) and Berry Global. We wrote about Discover Financial last quarter so we won’t rehash things here, but we believe the board suboptimized long term value for shareholders through a variety of actions over the prior year and a half. If you are interest ed in more detail you can read about it here. Nevertheless, their actions resulted in a higher share price in the short term which we took advantage of to exit the position.”
Overall, DFS ranks 3rd on our list of stocks that Jim Cramer is discussing ahead of Q1 earnings season. While we acknowledge the potential of DFS, our conviction lies in the belief that under the radar 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 DFS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
