In this article, we will take a detailed look Jim Cramer Says These 10 Stocks Will Go Higher in Trump Presidency.
In a recent program, Jim Cramer celebrated the market’s rally on Donald Trump’s election victory, saying the market likes Trump.
“The market likes Donald J. Trump, and it loves a peaceful transition to the next president. We got both, and we had a monster celebration. It was a full jailbreak, and the bears never knew what trampled them. Now, though, with the inclusion of this amazing session, we have to ask: have you missed the Trump rally?”
Cramer said the answer to the question of whether you missed the Trump rally lies in the stock you have in your mind. He said many were expecting a contested election and there was a lot of uncertainty around transition. However, that did not happen and that was in itself a win for the market.
“Trump wants to cut taxes—all taxes—including corporate taxes. Some numbers go higher, estimates go higher, earnings-per-share go higher. You do need to see interest rates go low for things to really work. Someday this is going to matter. It’s hard to keep doing this and piling on debt. But party on until we see damage; that’s what it felt like to me, seems to be the mantra.”
Cramer said the market is still “oversold” as many Trump stocks underwent a massive selloff after Kamala Harris reportedly started to gain ground. However, Cramer said the polls were again proved wrong.
Cramer then talked about the stocks that investors can buy to ride the Trump rally.
READ ALSO Jim Cramer’s Latest Lightning Round: 11 Stocks to Watch and Jim Cramer on AMD and Other Stocks
For this article we watched the latest programs of Cramer and picked stocks he believes can go higher under the Trump presidency. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10. Nucor Corp (NYSE:NUE)
Number of Hedge Fund Investors: 40
Talking about Nucor, Cramer said:
“The President-elect wants to protect the American industry he is here to protect Nucor from Chinese steel which is transhipped through Mexico right now. And the Biden administration did nothing about it. I’d buy that stock of Nucor even up here. Cleveland Cliffs and U.S. Steel should do well too—they’re not as good as Nucor, but they’re good.”
Earlier this year, Morgan Stanley upgraded Nucor Corp (NYSE:NUE) to “Overweight” from “Equal Weight” with a $176 price target. The bank highlighted that despite strong earnings growth and cash generation expected in 2025 and 2026, the stock has underperformed its peers.
Analyst Carlos de Alba noted that Nucor Corp (NYSE:NUE) currently trades at a discount to Steel Dynamics (STLD) on an EV/EBITDA basis for 2025, while its P/E premium is below its five-year average. De Alba believes this discount is unjustified given Nucor Corp (NYSE:NUE)’s higher expected earnings growth.
De Alba also favors Nucor Corp (NYSE:NUE) over Cleveland-Cliffs (CLF), citing expected subdued auto production in the second half of 2024, which he thinks will limit upside for flat steel prices and constrain Cliffs’ earnings recovery.
With over 50 years of consecutive dividend increases, steel company Nucor Corp (NYSE:NUE) is one of the best stocks that can benefit from a Trump presidency, according to Wolfe Research. Nucor Corp (NYSE:NUE) has been on an acquisition spree lately, expanding into new growth areas. In April, Nucor Corp (NYSE:NUE) bought data center infrastructure firm Southwest Data Products, Inc. (SWDP) for $115 million.
With the deal Nucor Corp (NYSE:NUE) entered the AI infrastructure market where specific solutions to maintain cool temperatures at data centers are in high demand. To address this market, Nucor Corp (NYSE:NUE) is creating a dedicated group.
9. Texas Roadhouse Inc (NASDAQ:TXRH)
Number of Hedge Fund Investors: 42
A caller recently asked Jim Cramer about MCD. Cramer instead recommended Texas Roadhouse Inc (NASDAQ:TXRH) as a better buy.
“Don’t know if you caught last night’s show. We had a Texas—Texas Roadhouse on yesterday. TXRH. And I don’t know about you, maybe you can pull it up online, but it was incredible. And it is making me rethink the restaurant group. I think Texas Roadhouse is a better stock, though, than McDonald’s.”
Despite tough competition in the industry, Texas Roadhouse Inc (NASDAQ:TXRH) is growing. In the third quarter, Texas Roadhouse Inc (NASDAQ:TXRH) achieved 8.5% growth in comparable sales, driven by a 3.8% increase in traffic and 4.7% growth in the average check per guest. Texas Roadhouse Inc (NASDAQ:TXRH) opened seven company-owned restaurants domestically and three internationally, with a target of 30 company-owned and 14 franchise-owned restaurants for the year. Texas Roadhouse Inc (NASDAQ:TXRH) acquired 13 franchised locations, set to operate under its control starting in FY 2025, which will significantly boost revenue growth and operating cash flow.
Texas Roadhouse Inc (NASDAQ:TXRH) is also on track to convert 250 restaurants to its Digital Kitchens by the end of FY 2024, with plans to convert an additional 300 units in FY 2025.
Over the past two years Texas Roadhouse Inc (NASDAQ:TXRH) has grown from 162 to nearly 775 units, a 350% increase, and expanding its workforce to over 100,000 employees.
Baird Mid Cap Growth Equity Strategy stated the following regarding Texas Roadhouse, Inc. (NASDAQ:TXRH) in its Q2 2024 investor letter:
“Adjustments made to our consumer discretionary exposure include the addition of two new positions, Texas Roadhouse, Inc. (NASDAQ:TXRH) and Dutch Bros—both restaurants. Texas Roadhouse is a full-service casual dining chain with a long history of consistent sales and profit growth and above-average returns. We believe recent inflationary pressures across the restaurant space have broadened Texas Roadhouse’s competitive positioning.”
8. Palantir Technologies Inc (NYSE:PLTR)
Number of Hedge Fund Investors: 44
Jim Cramer said in the latest program that Palantir Technologies Inc (NYSE:PLTR) can go much higher amid the Trump presidency.
“There’s a sense that a Trump presidency will bring more hacks …This one will do best ..Palantir, upending the Pentagon procurement process, making it possible for us to play offense in cybersecurity. President-elect Trump is going to have a lot of fun with Alex Karp, the co-founder and CEO. That stock could go much higher; I don’t care about the valuation. I know it’s a popular stock—it can go higher.
What makes Palantir Technologies Inc (NYSE:PLTR) one of the top AI stocks? Its technologies are actually solving the problems of businesses. Palantir’s data technology Ontology is solving the famous hallucination problem for AI systems, thanks to the company’s years of experience with military and defense systems. Earlier this year at an event with customers, Palantir Technologies Inc (NYSE:PLTR) shared some specifics on how its customers are being able to reduce costs and increase profits due to its artificial intelligence platform (AIP) that was launched about a year ago.
Airbus accelerated A350 production by 33%, BP reduced costs per barrel by 60%, and Jacobs Connect cut power usage by 30%. Panasonic decreased waste by 12%, ESI Group sped up ERP harmonization by 70%, and PG&E reduced transformer ignitions by 65%. Eaton boosted productivity by 25%, while Tyson Foods achieved $200 million in cost savings.
However, Palantir Technologies Inc (NYSE:PLTR) stock’s valuation has been a concern for many.
The stock is trading at about 21.2 times the next 12 months (NTM) revenue. For fiscal year 2024, Palantir expects revenue growth of 24% year-over-year (YoY) to $2.746 billion, with an adjusted operating income of $970 million, representing a 35.3% margin. However, revenue growth is expected to slow over the next two years, with estimates suggesting a 22% YoY growth rate, potentially bringing revenues to around $4 billion by fiscal 2026. If Palantir Technologies Inc (NYSE:PLTR) can improve margins by 100 basis points annually, it would be able to generate about $1.5 billion in adjusted operating income by FY26, with a present value of $1.3 billion when discounted at 8%. Applying an S&P 500-like growth multiple of 2.5 to 2.75 times earnings, Palantir Technologies Inc (NYSE:PLTR) would have a P/E of 46, translating to a price target of $27, significantly down from its current price of $42.
7. Valero Energy Corporation (NYSE:VLO)
Number of Hedge Fund Investors: 45
Valero Energy Corporation (NYSE:VLO) is one of the stocks Jim Cramer likes after Donald Trump’s victory in the elections.
“I like the refiners, think Valero, Phillips 66 and Marathon P. Because I thought we were gonna have a Democratic field day against these three, no, not going to happen, no.”
Valero Energy Corporation (NYSE:VLO) has posted YTD earnings of $6.6 per share, with prices slightly below the 10-year annual range. This suggests an average annualized EPS of $9-10, placing Valero Energy Corporation (NYSE:VLO) at the lower end of a teen P/E ratio, which is a more reasonable valuation, assuming a margin recovery.
Despite Trump’s victory, the stock could see volatility ahead due to high supply and weak demand. Plans to increase drilling could add to supply, pushing down prices and spreads, potentially impacting Valero Energy Corporation (NYSE:VLO)’s recovery.
California’s anti-refining stance could push the state to raise inventories, and Valero Energy Corporation (NYSE:VLO) has considered closing refineries there. Valero Energy Corporation (NYSE:VLO) has also faced over $80 million in fines for air quality violations. However, the risks are overstated, as new refinery construction is restricted in California, giving Valero Energy Corporation (NYSE:VLO) a dominant position. This is why its West Coast division earns 70% higher profits than other regions. While the company opposes policies threatening this advantage, it would likely avoid shutting profitable refineries, so concerns here seem exaggerated.
6. Tesla Inc (NASDAQ:TSLA)
Number of Hedge Fund Investors: 85
Talking about different stocks that have the “staying power” after Donald Trump’s victory in the elections, Cramer said Tesla Inc (NASDAQ:TSLA) rally “has legs.”
“I’m telling you, I can’t believe it was up much more. For Trump, politics is personal; he will reward Elon Musk as much as he can, given the constraints of the law. Tesla does need some things, and Elon Musk wants self-driving approval nationwide. Trump might push for interstate self-driving,” Cramer said.
The Tesla Robotaxi event disappointed investors. Notably absent was the discussion of a “more affordable” model that Musk had previously mentioned to boost confidence in Tesla’s vehicle sales growth outlook.
What about the $30,000 price tag claim?
Musk has indicated that the Cybercab will have a production cost of approximately $30,000. Operating within the Robotaxi fleet is projected to cost around $0.20 per mile. With a production cost of $30,000, the retail price of the Cybercab is likely to exceed this figure. For instance, if the Cybercab is priced at $30,000 per unit, that translates to $15,000 per seat. In contrast, the average price per passenger seat in Tesla Inc (NASDAQ:TSLA)’s most affordable long-range RWD Model 3—factoring in full self-driving (FSD) licensing—is under $10,000 ($29,990 post-incentive vehicle price plus $8,000 for the FSD license, divided by four passenger seats). Regarding operational costs, while the Cybercab is expected to cost $0.20 per mile, charging the Model 3 is estimated at under $0.10 per mile, leaving a significant margin to cover maintenance and downtime.
There is a lot of hype around Tesla Inc (NASDAQ:TSLA) robo taxis but many believe they will not be enough to fix the company’s long-term challenges.
What are these challenges?
Tesla Inc (NASDAQ:TSLA) product lineup is showing signs of stagnation, with over 95% of sales still coming from the Model 3 and Model Y. Meanwhile, competitors are rolling out more advanced models. Even Rivian’s CEO suggested Tesla Inc (NASDAQ:TSLA) could be nearing market saturation for these models. According to Reuters, Tesla’s market share in Europe is slipping as legacy automakers like BMW post stronger sales. Chinese competitor BYD is also gaining ground in Europe, despite talk of tariffs.
5. ServiceNow Inc (NYSE:NOW)
Number of Hedge Fund Investors: 97
A caller recently told Jim Cramer how he bought ServiceNow Inc (NYSE:NOW) after Cramer’s recommendation and bagged some profits. Cramer commented:
“New price target. I’m going to say the stock goes to 1200. It is at 994, it is going to 1200. It is probably one of the best stocks in this entire market to buy. You have my blessing to keep it until $1200.”
ServiceNow Inc (NYSE:NOW) impressed the market with strong Q3 results. But can the stock keep going higher? ServiceNow Inc (NYSE:NOW) recently launched its Now Platform Xanadu, adding more than 350 out-of-the-box generative AI capabilities to Now Assist. These features include data visualization automation, chat- and email-reply generation, change summaries, and LLM-based proactive prompts in Virtual Agent.
ServiceNow Inc (NYSE:NOW) also released RaptorDB Pro, a high-performance database enabling customers to centralize operational data and analytics onto ServiceNow platforms. These platforms are expanding the company’s abilities in the IT market.
ServiceNow Inc (NYSE:NOW) bulls believe the company’s organic revenue growth after fiscal 2025 could clock in between 20% to 22%. ServiceNow Inc (NYSE:NOW) can also expand its margins by 250bps annually, driven by 100bps from gross profits, 100bps from R&D reductions, and 50bps from SG&A leverage.
NOW will also benefit from organic growth catalysts. Grand View Research predicts that the global information technology service management (ITSM) market will grow at a CAGR of 9.3% from 2023 to 2030.
4. JPMorgan Chase & Co (NYSE:JPM)
Number of Hedge Fund Investors: 111
Jim Cramer said in the latest program on CNBC that major bank stocks are “still cheap” despite having a bull run after the Trump victory. He thinks Trump’s presidency would bode well for these stocks.
“The banks have been pushed down for ages because the Democrats, who love to go after the industry. That in turn really debilitated them. Now, the banks can be unfettered. They might be able to merge again. More importantly, the investment banks can focus on many more mergers, and regulators will look the other way. We’ll likely see more IPOs, too. It’s hard to convey how much tension there was between bankers and the Biden administration. They were like oil and water, that’s it.”
Cramer said he sold some bank stocks after the latest run but recommended investors buy them on the dip because he thinks they are still cheap.
JPMorgan Chase & Co (NYSE:JPM) remains among the biggest banks in the US despite fears of recession and rising loss provisions. The bank’s Q3 results showed a notable boost in profitability, driven by a combination of increased net interest income and lower non-interest expenses. Pre-tax income, before accounting for loan loss provisions, surged to $20.1 billion. Even though loan loss provisions jumped sharply from less than $1.4 billion in Q3 2023 to over $3.1 billion in Q3 2024, pre-tax income still grew by several hundred million.
Despite the rise in loan loss provisions, the bank remains well-positioned. Loan provisions fluctuate with the economic cycle, being lower in prosperous years and higher during downturns. Although 2024 may be a more challenging year, JPMorgan Chase & Co (NYSE:JPM)’s financial performance demonstrates it can easily absorb these higher provisions. In fact, JPMorgan Chase & Co (NYSE:JPM) is capable of managing up to $20 billion in loan loss provisions annually before it faces a loss. While concerns about bank safety and rising provisions are valid, larger U.S. banks like JPMorgan Chase & Co (NYSE:JPM) are in a strong position to weather such fluctuations. JPMorgan Chase & Co (NYSE:JPM)’s CET1 ratio of 15.3% stands out as an enviable metric among its peers.
3. UnitedHealth Group Inc (NYSE:UNH)
Number of Hedge Fund Investors: 114
Jim Cramer is bullish on the health insurance sector after the Trump victory in the election and said he likes UnitedHealth Group Inc (NYSE:UNH).
“Health insurers deserve to run, every one of them. I think the Republicans now have enough votes to get rid of whatever the health insurance deemed to be onerous about Obamacare. Huge win. I like United Health because it always does well anyway.”
UnitedHealth Group Inc (NYSE:UNH) is one of the biggest managed healthcare players globally, with segments like UnitedHealthcare, OptumRx, OptumInsight, and OptumHealth. Analysts believe UNH has strong growth catalysts for 2025 because it may be able to raise prices. BofA expects the company’s EPS to approach $28 this year, with steady growth in the low double digits through 2026. Revenue growth is expected by Wall Street in the range of 7% to 8% annually. While dividends are forecasted to rise by more than 10% each year through 2026, the yield may remain under 2%, and its trailing 12-month free cash flow yield is modest at around 1%. Based on these factors, UnitedHealth Group Inc (NYSE:UNH) forward P/E of 20 looks attractive.
Baron Health Care Fund stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its Q3 2024 investor letter:
“UnitedHealth Group Incorporated (NYSE:UNH) is a leading health and well-being company that operates across four segments: UnitedHealthcare, Optum Health, OptumInsight, and OptumRX. Despite complex Q2 results that involved multiple adjustments and an elevated medical loss ratio that management attributed to a cyberattack on its Change Healthcare platform, shares increased on positive management comments and reaffirmation of adjusted EPS guidance for 2024. We believe UnitedHealth should continue to see strong growth and profitability, driven by positive demographic trends and its ability to manage costs by leveraging its size and scale, continuing its industry-leading technology investments, expanding its expertise in population health, and growing its portfolio of providers.”
2. Nvidia Corp (NASDAQ:NVDA)
Number of Hedge Fund Investors: 179
Talking about stocks that can go higher in the Trump era, Cramer said that the President-elect will like Nvidia Corp (NASDAQ:NVDA).
“Trump likes winners; he likes success stories, which means he’ll like NVIDIA. Trump is all in with Elon Musk, and you know Elon Musk respects NVIDIA.”
Investors will be keenly watching Nvidia Corp (NASDAQ:NVDA) when the company reports its latest quarterly results next month.
Nvidia’s declines after the Q2 results were more or less expected amid Blackwell delay reports confirmed by management. However, the delays were mainly due to a change in Blackwell GPU mask. That does not affect the main functional logic or design of the chip, according to analysts. While Blackwell has been delayed for a few months, it does not change the core growth thesis for Nvidia Corp (NASDAQ:NVDA).
Nvidia Corp (NASDAQ:NVDA) is set to see huge growth on the back of the data center boom amid the AI wave.
At Nvidia Corp (NASDAQ:NVDA)’s GPU Technology Conference in March 2024, CEO Jensen Huang estimated annual spending on data center infrastructure at about $250 billion. Over the next decade, this could total between $1 trillion and $2 trillion, depending on how long this level of investment continues. During the same Q&A session, Bank of America’s Vivek Arya echoed this estimate, suggesting the total addressable market would fall in the $1-2 trillion range, particularly as countries invest in their own AI infrastructure. By the end of the decade, spending could be at the high end of that range.
Vltava Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2024 investor letter:
“Over the summer, we devoted a lot of time to studying the AI-related investment wave. This spans a wide range of sectors and our view could be very briefly summarised as follows: The first-tier beneficiaries are primarily companies in the semiconductor sector, NVIDIA Corporation (NASDAQ:NVDA) perhaps the most. That company is benefiting from the huge increase in investment by large technology companies to build enormous data centres. We know who NVIDIA’s customers are. They are companies like Meta, Alphabet, Amazon, and Microsoft. They are investing hundreds of billions of dollars into their AI capabilities. What is not entirely clear, however, is who are and will be the customers of NVIDIA’s customers, and, more importantly, when, and if, they will be able to come up with such huge demand for AI services that the profits from AI will justify and pay for the enormous investments all these companies have been making. The further we move away from the starting point that NVIDIA represents in our more broadly-reaching estimates, the lessreliable those estimates are.So far, we know just one thing for sure, and that is that investments in AI capabilities are ongoing and they are huge. They are not only bringing large demand to chipmakers and the semiconductor sector but to some other sectors as well. Indeed, building AI clusters also requires the construction of new semiconductor factories, new energy sources, and all the associated infrastructure. The numbers under consideration are incredibly high. It is possible that over the next decade the construction of AI centres will necessitate a 20% increase in US energy consumption. The investment required will be measured not in the hundreds of billions of dollars, but in an order of magnitude higher. Maybe two orders of magnitude.”
1. Meta Platforms Inc (NASDAQ:META)
Number of Hedge Fund Investors: 219
Talking about Meta, Cramer said:
“I would also buy Meta here. There’s all sorts of bogus scuttlebutt about how the President elect and Mark Zuckerberg don’t get along. I think that’s the old days people. I believe things have gotten better between the two, and you should think more about the fundamentals now, which are fabulous. Look, there is some common ground between the two. People were worried about the two of them being angry at each other. No.”
Despite posting strong quarterly results, Meta Platforms (NASDAQ:META) shares fell as rising AI-related expenses yet again spooked investors about ROI. However, Meta platforms (NASDAQ:META) bulls believe Zuckerberg’s plan to keep spending on AI is totally justified.
Meta Platforms (NASDAQ:META) is driving usage and ads revenue by improving its algorithms and user experience thanks to AI. Meta also reported strong adoption of its Llama AI model, attracting over 500 million monthly active users across its platforms. This progress positions Meta well for robust profitability in the next two years as it scales its AI infrastructure.
Meta Platforms (NASDAQ:META)’s advancements in Reels and WhatsApp are helping manage CapEx growth as the company strives to stay competitive in AI.
Meta Platforms (NASDAQ:META)’s clear monetization strategy for its generative AI, especially with Llama3, makes it a strong contender against rivals like OpenAI’s ChatGPT. Meta Platforms (NASDAQ:META)’s substantial user base of 3.3 billion provides a data and distribution edge that could capture a significant share of the GenAI market. Although short-term investors may be concerned about Meta Platforms (NASDAQ:META)’s increased AI spending, its forward P/E ratio of 24x, based on FY 2025 EPS estimates of $24.62, makes it the second-most affordable big tech stock, after Google, within its peer group (Apple, Amazon, Microsoft, and Google).
According to some estimates, Meta Platforms (NASDAQ:META) is on track to potentially achieve $25-26 per share in EPS next year, slightly above the consensus estimate. Factors such as a strong U.S. economy, lower inflation, favorable online ad pricing, and AI investments could fuel earnings growth. If Meta’s valuation aligns with the industry average P/E of 26.6x, shares could reach over $600.
Baron Opportunity Fund stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q3 2024 investor letter:
“Shares of Meta Platforms, Inc. (NASDAQ:META), the world’s largest social network, were up this quarter, due to impressive top-line growth of 22% year-over-year and solid forward guidance. Despite its large scale, Meta continues to outgrow the broader digital advertising industry, with better AI-driven content recommendations increasing engagement in products like Instagram Reels, and AI improving ad targeting and conversion rates. Our industry checks have continued to validate advertiser adoption and satisfaction, with improvements in Reels monetization, as well as strong adoption of Advantage+, Meta’s AI-driven service to allocate advertiser budgets across its content surfaces.
Meta continues to innovate in Gen AI, with a leading AI research lab and the best open-source models to date. We believe CEO Mark Zuckerberg’s open-source approach will encourage a broader developer ecosystem and standardization based on Meta, which will be beneficial for the company even if Meta doesn’t directly monetize model usage over the near term. In a blog this summer, titled “Open Source AI Is the Path Forward,” Zuckerberg laid out his case:…” (Click here to read the full text)
While we acknowledge the potential of Meta Platforms (NASDAQ:META), 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 timeframe. If you are looking for an AI stock that is more promising than META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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