Jim Cramer, the host of Mad Money, has been considering the uncertainty surrounding 2025 and the ongoing macroeconomic challenges that are sparking important questions. One of the main points Cramer has been grappling with is the direction Washington will take in the coming months. He highlighted that, despite two months of processing the election results, there’s still a lack of clarity about what the priorities will be and what Congress might actually pass. Cramer also brought up several important questions about President Donald Trump’s stance on various issues.
“Is president-elect Trump serious about large widespread tariffs or is the tough talk just a negotiating tactic? How serious is Trump about mass deportations? Which, if enacted, would likely have an impact on… the labor market.”
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Another major question Cramer raised was about deregulation, how much benefit will companies truly see from it, and how quickly? In terms of corporate taxes, Cramer also noted that the extension of the 2017 Tax Cuts and Jobs Act seems likely, but he questioned whether Trump might push even further, potentially altering the tax landscape in a more significant way. Perhaps one of the most pressing questions Cramer raised concerned the bond market and its tolerance for large U.S. government budget deficits.
“And considering that last question, here’s a doozy: Will the bond market continue to tolerate big budget deficits from the US government?”
He pointed out that some argue the bond market has already begun to take a more stringent stance on national debt, evident in the rising treasury yields over recent months. Still, Cramer left it at that, suggesting the situation remains uncertain.
“Difficult to answer because as we learned last time, I mean, Donald Trump is not a predictable president, great for cable news ratings, but sometimes frustrating when you’re in the business of making predictions. Hmm, maybe a higher cash position than normal could beckon.”
Jim Cramer Shed Light on These 9 Stocks
Our Methodology
For this article, we compiled a list of 9 stocks that were discussed by Jim Cramer during the episodes of Mad Money aired on January 7 and 8. We listed the stocks in ascending order of their hedge fund sentiment as of the third quarter, which was taken from Insider Monkey’s database of 900 hedge funds.
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).
Jim Cramer Shed Light on These 9 Stocks
9. Serve Robotics Inc. (NASDAQ:SERV)
Number of Hedge Fund Holders: 5
A caller asked Cramer about Serve Robotics Inc. (NASDAQ:SERV) but Cramer was quick to suggest Nvidia, calling the company “the king of robots”.
“Yeah. Okay, now this is one of these, look, we are going to revert to what, if you want robotics, here’s what you’re going to get from me. You’re gonna get Nvidia because they’re the king of robots. That’s it. Nobody else.”
Serve Robotics (NASDAQ:SERV) designs, creates, and operates low-emission robots that deliver food to people in public spaces across the United States, focusing on self-driving delivery robots. Over the past 12 months, the stock has seen a decline of over 35%. Meanwhile, NVDA stock is up more than 98% over the same period.
8. Lemonade, Inc. (NYSE:LMND)
Number of Hedge Fund Holders: 16
Cramer noted that Lemonade, Inc. (NYSE:LMND) stock is too high and mentioned that it is losing a lot of money.
“Okay, Lemonade’s stock is one of those stocks that I’ve been talking about on this show. It’s up too much. You gotta let it come down. It’s not a joke stock, but it’s losing a fortune. Companies that are losing fortunes go over your portfolio if you own them.”
Lemonade (NYSE:LMND) offers a variety of insurance products, including coverage for property, liability, and personal needs, while also acting as an agent for other insurance companies. Back in November 2024, a caller inquired about the company, and here’s what Mad Money’s host said, “I think this is a real short squeeze…Let’s wait ’til Friday and then maybe take some profits.”
7. QuantumScape Corporation (NYSE:QS)
Number of Hedge Fund Holders: 22
In response to a caller’s question about QuantumScape Corporation (NYSE:QS), Cramer said:
“I, you know, I, look, I don’t want to be too negative, but I’ve kind of had a Quantum escape. I don’t think they’ve got the, I don’t think they have the horses. I would be a seller of Quantumscape even right at this level. Have to say it.”
QuantumScape (NYSE:QS) is a research and development company focused on developing and bringing to market solid-state lithium-metal batteries for electric vehicles and various other uses. In October 2024, when talking about the company, Cramer quipped:
“No… The guys who told me to buy QuantumScape, they were Quantum wrong. So I don’t want to be Quantum wrong. I want to be Quantum right. I would avoid QuantumScape. Quantum escape, so to speak.”
6. Powell Industries, Inc. (NASDAQ:POWL)
Number of Hedge Fund Holders: 26
When a caller mentioned that Powell Industries, Inc. (NASDAQ:POWL) stock dropped off, Cramer said:
“It is unbelievable how badly that, I mean, I’m talking about, I did not see that coming. I think that I’ve gotta do more work on Powell because it has been a big, big disappointment.”
Powell (NASDAQ:POWL) specializes in designing, manufacturing, and servicing tailored electrical equipment and systems, such as substations, motor control centers, switchgear, and other related components. In November 2024, Cramer highlighted the company and remarked:
“We highlighted Powell Industries back in August. Here’s an old-line industrial that makes custom-engineered equipment to control electricity. Their machinery was primarily used by oil and gas companies, but lately, Powell’s become the supplier of choice for those who need critical electrical infrastructure… up almost 259% for the year.”
Cramer made the above comment on November 13, 2024, and since then, the stock is down over 24%.
5. Cencora, Inc. (NYSE:COR)
Number of Hedge Fund Holders: 45
Cramer praised Cencora, Inc. (NYSE:COR) but noted that there is a possibility that the stock might go lower.
“Cencora, Conshohocken… Used to be the old ABC, AmerisourceBergen. I have to tell you, I think that Steve Collis is really, really smart. I met him last year at the JPMorgan Healthcare… their conference. I gotta tell you, I think the stock can go lower because a lot of people don’t like… They don’t like McKesson. I prefer Cardinal to this one, but I did like the acquisition.”
Cencora (NYSE:COR) distributes pharmaceutical products and healthcare services globally, serving various healthcare providers with services such as pharmacy management, clinical trial support, and specialty logistics. Cramer’s preferred stock of Cardinal Health gained over 148% over the past 5 years while COR stock went up more than 200% during the same period.
TimesSquare Capital Management stated the following regarding Cencora, Inc. (NYSE:COR) in its Q3 2024 investor letter:
“Our preferences among Health Care stocks are those companies providing novel therapies for unmet needs that deserve premium pricing, or specialized service providers. Cencora, Inc. (NYSE:COR), a pharmaceutical products distributor, had a flat return due to uneven fiscal third quarter results. US health care revenues grew for the quarter, however, international fell short. Gross margins deteriorated due to a higher mix of GLP-1s.”
4. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)
Number of Hedge Fund Holders: 55
A caller mentioned disappointing news regarding Vertex Pharmaceuticals Incorporated’s (NASDAQ:VRTX) drug suzetrigine and asked Cramer if the outlook was positive for the company or not.
“I’ll tell you, you know, I’ve gotta tell you… I was sorely disappointed on that. I was praying that they would have something that wouldn’t be addictive and it looks like it’s not working. I would not, you know, now it reflects the other great drugs they have and nothing good on that drug. But I don’t see a lot of upside because that was the drug of the future for Vertex.”
Vertex (NASDAQ:VRTX) focuses on developing and marketing therapies for cystic fibrosis (CF) and has a pipeline of treatments in clinical trials for multiple conditions. ClearBridge Investments stated the following regarding Vertex (NASDAQ:VRTX) in its Q4 2024 investor letter:
“For the quarter, health care was the largest drag on relative results as larger holdings Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) and UnitedHealth Group suffered losses. Vertex, a biotechnology company known for its cystic fibrosis treatments, was hurt by a setback in clinical trials for its new therapeutic, suzetrigine, in the chronic pain setting. The company is continuing forward for this indication in the hopes that altering the future design of its trial will yield more promising results. Additionally, Vertex hopes to commercially launch the drug for acute pain in the first quarter and is still seeing growth and patent life extension in its cystic fibrosis franchise. The company also has additional pipeline assets, most notably to treat mediated kidney disease and Type 1 diabetes, which gives us confidence in the company’s ability to sustain profitable growth over the long term.”
3. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders: 58
Discussing PepsiCo, Inc. (NASDAQ:PEP), Cramer said:
“Yeah, Pepsi’s got, I mean, I read, I talked about that Cornell Business School study last week. It’s right in the wheelhouse. I mean it’s talking about salty potato chips. I don’t know what to say. Yield’s 3.73%, maybe when it gets to 4%, but right now it’s in the crosshairs of the GLP-1 situation.”
PepsiCo (NASDAQ:PEP) is a major player in the production, marketing, and distribution of various beverages and snack foods, with well-known brands such as Lay’s, Gatorade, Pepsi, Doritos, Tropicana, and Aquafina. In November 2024, Cramer talked about the company as he said:
“You know, I think Ramon Laguarta is doing such a good job but the odds are… If you have the Fed cutting rates, you shouldn’t own the stock. If you have the GLP-1s, you shouldn’t own the stock. If you have people saying that junk food is not good for you, you can’t own the stock and it’s just become just too darn hard. So even though it’s got a 3.5% yield, I do think it goes, unfortunately, I have to say it, I think it goes lower.”
2. Novo Nordisk A/S (NYSE:NVO)
Number of Hedge Fund Holders: 61
A caller asked Cramer about Novo Nordisk A/S (NYSE:NVO) and how it compares to Eli Lilly and Cramer replied:
“Okay, Novo Nordisk I think is inferior. They don’t have the production capability. They don’t have what I think is the best pipeline. And I gotta tell you, Denmark, geez, maybe president-elect Trump’s gonna pick a fight with them. I’d be careful.”
Novo Nordisk A/S (NYSE:NVO) is involved in researching, developing, producing, and distributing pharmaceutical products. Over the past year, NVO stock is down more than 20% while LLY stock has gained over 24%.
ClearBridge Investments stated the following regarding Novo Nordisk A/S (NYSE:NVO) in its Q4 2024 investor letter:
“Similarly, we used a temporary price dislocation caused by disappointing clinical trial results to purchase shares of Novo Nordisk A/S (NYSE:NVO), a Danish-based leader in diabetes and obesity treatments. Novo’s Wegovy semaglutide drug was first to market among the new generation of obesity drugs; however, the company has lost market share to portfolio holding Eli Lilly due to delays in scaling up production volumes and superior weight loss results demonstrated by Lilly’s trizepatide drugs. While the initial market reaction to Novo’s more enhanced CagriSema weight loss treatment was negative, we believe this is a more potent formulation that can better compete with Lilly’s suite. With Novo poised to have a better product portfolio and improved supply position, we find the company’s valuation very attractive given the large secular growth trends behind the diabesity market.”
1. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 80
When a caller asked Cramer about Pfizer Inc. (NYSE:PFE), he said:
“It’s too low to sell. That’s all I can say. I can’t recommend it. I just don’t want you to sell it if you have it. Let the dividend do its job and then maybe we get some good news on the Seagen acquisition.”
Pfizer (NYSE:PFE) focuses on the discovery, development, production, and distribution of biopharmaceuticals, covering diverse therapeutic areas such as cardiovascular health, infectious diseases, oncology, immunology, and vaccines, including treatments for chronic conditions, cancer, and COVID-19. In November 2024, while discussing drug stocks, Cramer talked about Pfizer and said:
“Pfizer, which picked up some potentially revolutionary cancer therapies from Seagen, is now trading at nine times earnings, 6.5% yield, for heaven’s sake. Although, it has a vaccine business and it calls vaccines, and I quote, ‘one of the greatest public health advancements of all time’… Still, anything good there, it could fly.”
While we acknowledge the potential of Pfizer Inc. (NYSE:PFE) 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 PFE 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 Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure: None. This article was originally published at Insider Monkey.
