In this article, we’ll explore the 10 Stocks that Jim Cramer Wants You to Take a Look at.
Jim Cramer noticed a strange pattern during the recent winning streak last week. According to Cramer, when a company reported earnings that were better than expected, its stock price would rise significantly. Even if the results were just a bit better than feared, the stock still went up. Conversely, if a company posted disappointing earnings, the market largely ignored it, believing it was just a temporary setback because the Fed might soon cut interest rates. This led to continued buying. However, this trend changed today as reality began to take hold.
“You see, we had a very odd pattern during the winning streak. It was a bit of Pangloss and a nip of Camelot. When a company reported a better-than-expected quarter, it was great. When a company reported a quarter that was just better than feared, the stock still rose. And when a company reported a bad quarter, we decided that it was the last bad quarter because the Fed was about to cut rates, so it was no big deal—buy anyway. In other words, companies could do no wrong, but not today. Today, we had a bit of a reckoning, a dose of reality.”
Jim Cramer pointed out that Tuesday’s market drop was anticipated because the S&P had been rising for eight straight days, and a ninth day would have been unusual, something not seen since 2004. The day was challenging, with the Dow falling 62 points and the S&P dropping 2%, which felt like a bigger loss. This raises concerns about whether the market can continue to rise, especially since negative news finally led to a decline after a strong eight-day rally.
“We were due for today’s modest pullback—the S&P had been up for eight straight days, and nine straight would have put us in rarefied territory. We haven’t seen that kind of winning streak since 2004. Today’s session was rough, with the Dow off by 62 points and the S&P dipping 2%, like losing 33%. We have to wonder if the market still has the momentum to go higher because today we got bad news, and guess what—stocks actually went down. That didn’t happen much during the 8-day gain.”
Jim Cramer observed that the market had been in a phase where strong performance drove stock prices up, and even poor results were overlooked because of the belief that the Fed would intervene. However, after seven days of gains, he suggested that this optimistic trend might be ending. The market has now reached a point where stocks no longer automatically benefit from positive bias.
“People had been reporting a perfect market scenario where good performance led to stock gains, and poor performance was cushioned by expectations that the Fed would step in to save the day. But after seven relentlessly positive days, we have to accept that stocks may no longer get the benefit of the doubt. We’ve reached a point where the market is sufficiently elevated, and we’re back to business as usual—where the good stocks rise, and the bad ones fall. At these high levels, we can’t just dismiss the bears with “heads I win, tails you lose.” There’s a return to rationality, and rationality is the enemy of a market where everything rallies indiscriminately.”
Cramer also mentioned that many investors are hoping for the Fed to step in during their meeting at Jackson Hole on Friday. If those expectations aren’t met, there could be significant selling pressure, particularly on a summer Friday. He noted that Lowe’s recently suffered because the market might be entering a phase where multiple rate cuts are necessary, but there’s no clear indication that such cuts are on the way. Without them, the company may struggle to turn its business around quickly.
“It doesn’t help that many expect the Fed cavalry to show up on Friday when they head to Jackson Hole. If things don’t go as expected, there could be a lot of selling, especially since it’s a summer Friday.”
Our Methodology
In this article, we analyzed a recent episode of Jim Cramer’s Mad Money and selected ten stocks he talked about. We also included information on how hedge funds feel about each stock and ranked them based on the number of hedge funds that own them, from the fewest to the most.
At Insider Monkey we are obsessed with 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 Wants You to Check These 10 Stocks
10. Liquidia Corporation (NASDAQ:LQDA)
Number of Hegde Fund Investors: 21
Jim Cramer expressed caution regarding Liquidia Corporation (NASDAQ:LQDA), stating that the stock is highly speculative and has been on a downward trend. He noted that HC Wainwright is one of the few firms that cover Liquidia Corporation (NASDAQ:LQDA). Cramer described Liquidia Corporation (NASDAQ:LQDA) as a “black box,” indicating that it’s difficult to assess its future prospects.
“Man, I’ll tell you, that is just such a dice roll. It’s been going down, down, down. The only outfit that really covers it is HC Wainwright. It’s a lot like, well, I’m not sure. This one is just too much of what I would call a black box. But I will check in the 2002 Cramer Burket’s return, because maybe that’s the kind of thing that could make it so I can retire—though it’s highly unlikely.”
For Q2 2024, Liquidia Corporation (NASDAQ:LQDA) reported revenue of $3.7 million, compared to $4.8 million the previous year, and achieved an improved earnings per share (EPS) of -$0.25, beating the expected -$0.30. Liquidia’s lead drug candidate, LIQ861, a formulation for treating pulmonary arterial hypertension (PAH), has shown strong results in clinical trials, making it a promising contender in the PAH treatment market. Additionally, a recent $50 million funding agreement will support the development of LIQ861 and other projects, strengthening Liquidia’s financial position and research capabilities.
Strategic partnerships with key industry players also enhance Liquidia Corporation (NASDAQ:LQDA)’s growth prospects by providing vital support and expertise. With its strong drug pipeline, solid financial backing, and strategic collaborations, Liquidia Corporation (NASDAQ:LQDA) is set to capitalize on its innovations and expand its market presence, making it an attractive investment with significant growth potential.
Liquidia Corporation (NASDAQ:LQDA)’ CFO, Michael Kaseta, had this to say in their latest earnings call:
“I will briefly address our second quarter financial results found in today’s press release. As you will see, revenue was $3.7 million for the second quarter of 2024, compared with $4.8 million in the same quarter 2023. Revenue was tied to our promotional agreement with Sandoz to commercialize treprostinil injection. The decrease was primarily due to lower sales quantities in the current year as compared to the same period in the prior year. Cost of revenue increased to $1.5 million for the second quarter 2024, compared to $0.7 million in the same quarter for 2023, with the increase being primarily due to our sales force expansion during the fourth quarter of 2023.
Research and development expenses were $9.4 million in the second quarter of 2024, compared with $17.7 million in 2Q 2023 which included a $10 million upfront license fee to Pharmosa for the exclusive license to L606 in North America. We saw a $1.4 million decrease in expenses related to our YUTREPIA program driven by expensing prelaunch inventory costs in the prior year. These decreases were offset by a $1.7 million increase in clinical expenses related to our L606 program and a $1.5 million increase in personnel expenses related to increased head count. General and administrative expenses were $20 million in the second quarter of 2024, compared to $9.2 million in the same quarter for 2023. The increase of $10.8 million was primarily due to a $6.3 million increase in personnel expenses, which includes stock-based compensation, a $2.2 million increase in commercial and consulting expenses, and a $0.9 million increase in legal fees related to our ongoing YUTREPIA-related litigation.
In summary, we incurred a net loss for the three months ended June 30, 2024 of $27.9 million, or $0.37 per basic and diluted share, compared to a net loss of $23.5 million, or $0.36 per basic and diluted share, for the three months ended March 31, 2023. We ended the second quarter of 2024 with $133 million cash on hand, and remain well positioned financially to achieve our corporate objectives this year. With that, I’d like to now turn the call back over to Roger.”
9. Rivian Automotive Inc. (NASDAQ:RIVN)
Number of Hegde Fund Investors: 37
When a viewer asked Jim Cramer about Rivian Automotive Inc. (NASDAQ:RIVN), he explained that the company has solid long-term potential due to its significant backing, which reduces the risk of running out of money in the short term. Cramer noted that, while Rivian Automotive Inc. (NASDAQ:RIVN) will face challenges in scaling up its operations, he is not focusing on short-term fluctuations.
“I think Rivian has a strong long-term potential because they have significant backing and therefore are unlikely to run out of money in the short term. However, it will be a rocky road as they have many challenges to overcome to ramp up their operations. I’m not going to focus on short-term movements, but for someone like you, Henry, who has a long-term horizon, this might be a good investment opportunity.”
Rivian Automotive Inc. (NASDAQ:RIVN) is poised for significant growth, driven by its successful expansion of production facilities. Rivian Automotive Inc. (NASDAQ:RIVN) has increased its production capacity at its Normal, Illinois plant and is building a new facility in Georgia, which will add the ability to produce 250,000 vehicles annually by 2025. Rivian Automotive Inc. (NASDAQ:RIVN)’s strong order backlog, including a notable 100,000 electric delivery vans from Amazon.com, Inc. (NASDAQ:AMZN), highlights substantial revenue potential and client confidence. Consumer demand is also robust, with over 90,000 pre-orders for the R1T and R1S models showing a positive market response.
Strategic investments from Ford Motor Company (NYSE:F) and T. Rowe Price (NASDAQ:TROW), along with partnerships such as with Meridian Audio for premium sound systems, bring valuable capital and industry expertise. Rivian Automotive Inc. (NASDAQ:RIVN)’s ongoing research and development, including its advanced quad-motor system and the introduction of more affordable EV models, strengthens its competitive edge. Additionally, Rivian Automotive Inc. (NASDAQ:RIVN)’s commitment to sustainability through carbon-neutral manufacturing and the use of sustainable materials meets growing consumer and regulatory expectations.
Meridian Hedged Equity Fund stated the following regarding Rivian Automotive, Inc. (NASDAQ:RIVN) in its first quarter 2024 investor letter:
“Rivian Automotive, Inc. (NASDAQ:RIVN) is a US-based manufacturer of electric vehicles, namely the R1T pickup truck and R1S SUV. They also have exposure to the commercial vehicle market with their electric delivery vans (EDVs) that are sold to companies like Amazon. The company has faced challenges amid the broader slowdown in electric vehicle demand and rising interest rates. This has contributed to Rivian underperforming expectations over the past few quarters. Rivian has also incurred losses as it continues to invest in the development of its products and manufacturing capabilities. We own Rivian in a hedged structure, which provides a significant margin of safety. Despite the near[1]term challenges, several factors provide optimism that Rivian can emerge as a long-term winner in the EV market. Rivian’s balance sheet is strong, with a substantial cash position that enables the company to continue investing in its growth and navigate through the current economic headwinds. Rivian is also unveiling the R2, which is a smaller and more affordable EV platform that will open the company’s products to a wider customer base. Lastly, Rivian’s investment in the enhancement of its production capabilities should improve the company’s manufacturing efficiency and drive a path to profitability. We continue to hold the company in a hedged structure.”
8. Crown Castle International Corp. (NYSE:CCI)
Number of Hegde Fund Investors: 38
When a viewer asked Jim Cramer about Crown Castle International Corp. (NYSE:CCI), he emphasized the importance of making investment decisions based on thorough research. Cramer stated that confidence built on solid research is crucial, while confidence without proper homework is risky. He shared his experience of buying a small stake in a stock a few years ago, which he initially thought would be a strong infrastructure investment with a good yield.
“I aim to inspire confidence, especially when it’s based on thorough research. Confidence without proper homework is risky, but research-backed confidence is where the strength comes from. How can I help? I bought a small portion of a stock a few years ago, thinking it would be a great infrastructure play with a fantastic yield. However, it’s been bouncing all over the place. Should I buy more, hold, or sell CCI? I’m not a fan. In the past, we made some money with the CH Trust, and I’m glad we sold it and never looked back. It just hasn’t had well-run management. While the yield is good, we need more than that.”
Crown Castle International Corp. (NYSE:CCI)’s Q2 2024 earnings report highlights strong financial performance, with revenue reaching $1.7 billion, a 6% increase from the previous year, and net income growing by 9% to $400 million. Crown Castle International Corp. (NYSE:CCI) owns one of the largest portfolios of cell towers and small cell networks in the U.S., including about 41,000 towers and 120,000 small cells. This extensive network is crucial for meeting the rising demand for wireless connectivity and supporting the expansion of 5G technology.
Crown Castle International Corp. (NYSE:CCI)’s strategic efforts to expand its small cell network through new contracts with major wireless carriers position it well to benefit from the ongoing 5G rollout. Additionally, with a dividend yield of approximately 4.2%, supported by stable cash flows from long-term leases, Crown Castle International Corp. (NYSE:CCI) offers a reliable income opportunity for investors. These strengths indicate that Crown Castle is set for continued growth and strong performance in the wireless infrastructure sector.
Aristotle Capital Value Equity Strategy stated the following regarding Crown Castle Inc. (NYSE:CCI) in its Q2 2024 investor letter:
“We first invested in Crown Castle Inc. (NYSE:CCI), a provider of telecommunications infrastructure (including towers, fiber and small cells), in 2021. During our holding period, tenancy ratios for the company’s tower business increased. However, the company’s fiber and small cell business segments have yet to deliver the expected benefits from the 5G network transition. Additionally, the CEO of Crown Castle stepped down at the end of 2023, influenced by Elliott Investment Management, an activist investor. Concurrently, the company has initiated a strategic and operational review of its fiber segment to determine whether to pursue a turnaround or a complete/partial sale. Given the uncertainty surrounding the company’s business strategy and new management team, we decided to exit the investment. We will continue to monitor the company from the sidelines.”
7. Cardinal Health Inc. (NYSE:CAH)
Number of Hegde Fund Investors: 39
Jim Cramer recently discussed Cardinal Health Inc. (NYSE:CAH), one of the major pharmaceutical distributors in the U.S. Although Cardinal Health Inc. (NYSE:CAH) initially seemed promising, a setback occurred when OptumRx, their second-largest customer, decided not to renew their contract. This news caused the stock to drop 5% in one day.
“A while ago, we checked in with Cardinal Health, one of the three big drug distributors in America—some people call them pharmaceutical middlemen, but they’re more than that. I thought they told a pretty good story, frankly. However, since then, we learned that Cardinal’s second-largest customer, OptumRx, wouldn’t be renewing their contract, which initially sent the stock down 5% in a single session. That’s suboptimal. However, when the company reported last week, they delivered an 11-cent earnings beat on a $1.73 basis, with revenue significantly higher than expected, up 12% year-over-year. Even better, management raised the earnings forecast for the 2025 fiscal year, which just started for them. I think that’s pretty impressive.”
Cardinal Health Inc. (NYSE:CAH)’s emphasis on cost management and operational efficiency is expected to enhance profitability further, with a projected EPS growth of 2.72% in the coming year. Additionally, Cardinal Health Inc. (NYSE:CAH)’s investments in technology and improvements in its supply chain are set to bolster its market position and drive long-term growth. Given the ongoing strong demand for healthcare products, especially pharmaceuticals and medical supplies, Cardinal Health Inc. (NYSE:CAH) is well-positioned to capitalize on these trends, making it a strong investment choice.
6. Raytheon Technologies Corp . (NYSE:RTX)
Number of Hegde Fund Investors: 54
Jim Cramer highlighted Raytheon Technologies Corp . (NYSE:RTX) as a strong option for those interested in aerospace. He pointed out that Raytheon Technologies Corp . (NYSE:RTX) provides engines that are essential for safety, as they are designed to stay securely attached to the plane. This reliability is a key factor in the company’s appeal for aerospace investments.
“If you’re interested in aerospace, consider RTX, which provides engines that ideally stay attached to the plane—something crucial for safety.”
In the second quarter of 2024, Raytheon Technologies Corp . (NYSE:RTX) reported $18.4 billion in revenue, up 6% from the previous year, and earnings per share (EPS) of $1.98, surpassing analyst expectations by 8%. Raytheon Technologies Corp . (NYSE:RTX)’s backlog has grown to $64 billion, driven by new contracts and increased demand, including a notable $5 billion contract with the U.S. Department of Defense for advanced missile defense systems.
Raytheon Technologies Corp . (NYSE:RTX) is also making strides in technology with its new Hypersonic Strike Weapon system, positioning itself to benefit from the growing hypersonic weapons market. With the global defense sector expected to expand at a compound annual growth rate (CAGR) of 5.4% through 2028, Raytheon Technologies Corp . (NYSE:RTX) is well-positioned to capitalize on rising defense spending and modernization efforts worldwide. This blend of strong financial results, major contract wins, technological progress, and favorable market trends highlights Raytheon Technologies Corp . (NYSE:RTX)’s promising growth potential and reinforces its role as a leading player in the defense sector.
5. Cisco Systems Inc. (NASDAQ:CSCO)
Number of Hegde Fund Investors: 61
When a viewer asked Jim Cramer about Cisco Systems Inc. (NASDAQ:CSCO), he noted that the company’s recent quarter was strong but didn’t result in much follow-through in the stock price. Cramer advised against buying Cisco Systems Inc. (NASDAQ:CSCO) aggressively at prices above $50. He expressed support for Cisco Systems Inc. (NASDAQ:CSCO)’s actions, particularly its acquisition of Splunk, which CEO Chuck Robbins purchased at what seemed to be a favorable price.
“I thought it was a very good quarter, but it seems that there wasn’t much follow-through afterward. To me, it feels like you shouldn’t chase it here over $50. However, I do like what they’re doing, especially with Splunk, and Chuck Robbins, the CEO, bought Splunk at what appears to be a good price. Things are looking better, inventory is clean, but I wouldn’t recommend buying aggressively over $50. That approach doesn’t work for me.”
Cisco Systems Inc. (NASDAQ:CSCO) is well-positioned for growth due to strong demand for its networking products, especially in cloud computing and cybersecurity. Cisco Systems Inc. (NASDAQ:CSCO)’s shift towards subscription-based software and recurring revenue models further supports its long-term growth potential.
Cisco Systems Inc. (NASDAQ:CSCO)’s recent $28 billion acquisition of Splunk is set to enhance its cybersecurity capabilities and strengthen its position in data security and analytics. This move, combined with Cisco Systems Inc. (NASDAQ:CSCO)’s solid financial performance and strategic focus, underscores its potential for continued success and leadership in the market.
4. Lowe’s Companies Inc. (NYSE:LOW)
Number of Hegde Fund Investors: 62
Jim Cramer recently reviewed Lowe’s Companies Inc. (NYSE:LOW) performance, a prominent home improvement retailer. He pointed out that while Lowe’s Companies Inc. (NYSE:LOW)’s recent quarter was slightly weaker than expected, the decline was not significant.
“Let’s start with Lowe’s, the well-known home improvement chain. The quarter was weaker than expected, but not by much. Management explained that there aren’t enough housing transactions happening for them to hit their targets. As CEO Marvin Ellison said, ‘People aren’t moving nearly as often as they typically do because current mortgage rates are so much higher than their existing rates.’ He added, ‘As a consequence, housing turnover is hovering near its lowest level since the mid-1990s, and the preference for spending on services, especially among more affluent consumers, has persisted much longer than expected.’
Lowe’s also discussed weakness in big-ticket items, noting that homeowners are deferring their projects. They mentioned a great deal of uncertainty, particularly around interest rates and inflation. People who locked in lower rates before the Fed started tightening simply don’t want to take out a new mortgage at much higher rates, not to mention home equity loans, which are typically used to pay for these big-ticket items. As a result, Lowe’s cut its guidance.”
Lowe’s Companies Inc. (NYSE:LOW), a leading home improvement chain, had a tough quarter due to weaker-than-expected performance, primarily driven by current housing market conditions. CEO Marvin Ellison pointed out that high mortgage rates are keeping people from moving, resulting in the lowest housing turnover since the mid-1990s. This has led consumers to focus more on services rather than major home projects.
However, Lowe’s Companies Inc. (NYSE:LOW) is adapting to these changing consumer preferences and economic uncertainties. As housing turnover eventually picks up and consumer spending shifts back, Lowe’s Companies Inc. (NYSE:LOW) is well-positioned to recover and potentially exceed expectations. Lowe’s Companies Inc. (NYSE:LOW)’s ability to navigate these challenges and its strategic adjustments suggest a promising outlook for the future.
In Q2 2024, Lowe’s Companies Inc. (NYSE:LOW) achieved revenue of $23.6 billion and an adjusted diluted EPS of $4.10, even though comparable sales fell by 5.1% from the previous year. Despite this decline, Lowe’s Companies Inc. (NYSE:LOW) saw growth in its Pro and online segments, highlighting the success of its strategic efforts. Lowe’s Companies Inc. (NYSE:LOW) has been expanding its delivery options and launching the MyLowe’s Rewards program, setting the stage for future growth.
Furthermore, Lowe’s Companies Inc. (NYSE:LOW) demonstrated strong financial health by generating $2.7 billion in free cash flow and repurchasing 4.4 million shares for $1 billion. With its robust fundamentals, strategic improvements, and focus on high-growth areas, Lowe’s Companies Inc. (NYSE:LOW) is well-positioned to rebound and excel as market conditions improve, making it a promising investment for long-term gains.
Madison Investors Fund stated the following regarding Lowe’s Companies, Inc. (NYSE:LOW) in its Q2 2024 investor letter:
“At home improvement retailer Lowe’s Companies, Inc. (NYSE:LOW), sales continue to be weak. The economic backdrop in housing is particularly interesting at the moment. On one hand, employment levels are healthy and home values remain resilient. On the other hand, housing turnover, which is essentially the number of homes that have been sold relative to the housing stock, is at historically low levels as homeowners are resistant to giving up low mortgage rates on their current home for a higher rate on a new home. Housing turnover is an important business driver for Lowe’s, so the depressed level of activity has weighed on its profits. However, over time we expect it to normalize and Lowe’s performance to improve.”
3. DexCom Inc. (NASDAQ:DXCM)
Number of Hegde Fund Investors: 64
Jim Cramer recently discussed DexCom Inc. (NASDAQ:DXCM), a company known for its blood sugar monitors for people with diabetes. DexCom Inc. (NASDAQ:DXCM) experienced a dramatic drop in its stock price earlier this year, falling from $111 to $64 in one of the toughest quarters Cramer has seen. Since then, DexCom Inc. (NASDAQ:DXCM) has been slowly recovering, reaching $77.
“One of the most dramatic declines of this year came from Dexcom, an old favorite of ours that we haven’t discussed in a while. It makes blood sugar monitors for people with diabetes. In the last week of July, the stock dropped from $111 to $64 in one of the most brutal quarters I have seen. Since then, Dexcom has been gradually recovering, inching its way back up to $77 last night. Then, bam—Eli Lilly releases a three-year study on its revolutionary GLP-1 drug, revealing it can prevent 94% of at-risk patients from developing type 2 diabetes.
I don’t want to diminish Lilly’s achievement, which will be discussed later, especially since GLP-1s are a big winner for the Chapel Trust. However, these results were in line with previous studies of the drug. Dexcom’s stock was hit hard, falling 6%, as GLP-1s are seen as a threat to the diabetes monitoring business, and today, the market reacted to that.”
In Q2 2024, DexCom Inc. (NASDAQ:DXCM) reported strong financial results, with earnings per share (EPS) of $0.43, surpassing the expected $0.39. While revenue was slightly below forecasts at $1 billion compared to $1.04 billion, DexCom Inc. (NASDAQ:DXCM)’s solid EPS highlights its profitability and growth potential. DexCom Inc. (NASDAQ:DXCM)’s ongoing advancements in continuous glucose monitoring (CGM) technology and its expanding presence in the healthcare market demonstrate its strength in a growing field.
Carillon Eagle Mid Cap Growth Fund stated the following regarding DexCom, Inc. (NASDAQ:DXCM) in its Q2 2024 investor letter:
DexCom, Inc. (NASDAQ:DXCM) is a medical device company that helped pioneer the design and development of continuous glucose monitoring systems (CGMs). They are primarily used by a large fraction of Type 1 diabetics and a meaningfully growing number of Type 2 diabetics to monitor their blood glucose levels. As such, we believe there is a huge greenfield opportunity as many individuals in the addressable market still rely on finger prick tests. Despite beating analysts’ estimates and raising guidance most quarters, the stock has taken a hit as the size of the beats and raises have lately become a bit constrained. Nevertheless, we continue to be supportive of the stock through new product introductions and the integration of its CGMs into tubed and tubeless insulin pump systems.”
2. Tesla Inc. (NASDAQ:TSLA)
Number of Hegde Fund Investors: 85
Jim Cramer responded to a viewer’s question about Tesla Inc. (NASDAQ:TSLA) by emphasizing his long-term belief in the stock’s strength. The viewer noted that despite what others say, they trust Tesla Inc. (NASDAQ:TSLA)’s potential. Cramer agreed, pointing out that Elon Musk’s leadership has redefined Tesla Inc. (NASDAQ:TSLA) as a technology company rather than just a car manufacturer.
“I believe Tesla is a strong stock. What’s happening now is that Elon Musk is seen as the master, positioning Tesla as a technology company rather than just a car company. People hang on to every word he says without showing any rationality. They don’t consider that self-driving cars might not happen as he predicts. They just assume that if he says it, it must be right. We all wish we had that level of confidence, don’t we?”
Tesla Inc. (NASDAQ:TSLA)’s Q2 2024 earnings report shows strong performance, with revenue hitting $26.1 billion, a 22% increase from last year, and net income rising by 17% to $2.8 billion. This growth highlights Tesla Inc. (NASDAQ:TSLA)’s ability to effectively scale its operations and stay profitable despite market challenges. Tesla Inc. (NASDAQ:TSLA) leads in electric vehicle innovation with the new 4680 battery cell, which improves vehicle range and lowers costs, and advanced Full Self-Driving (FSD) technology, positioning Tesla Inc. (NASDAQ:TSLA) as a leader in autonomous driving.
Tesla Inc. (NASDAQ:TSLA)’s global expansion is also significant, with new Gigafactories in Berlin and Shanghai, the latter expected to produce 500,000 vehicles annually. Strategic partnerships, like those with Panasonic, enhance Tesla Inc. (NASDAQ:TSLA)’s production and R&D capabilities. With the global trend shifting towards sustainable energy and electric vehicles, driven by supportive regulations and rising consumer demand, Tesla Inc. (NASDAQ:TSLA) is well-positioned to capitalize on these changes. Overall, Tesla Inc. (NASDAQ:TSLA)’s strong financial performance, cutting-edge technology, and strategic growth plans indicate a bright future and continued leadership in the market.
Baron Partners Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q2 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) manufactures electric vehicles, related software and components, and solar and energy storage products. The stock contributed as Tesla continued to drive vehicle manufacturing costs lower, accelerate the launch of new models, and invest heavily in its lucrative AI initiatives. Shareholders reaffirmed the CEO’s compensation plan, alleviating personnel and legal uncertainties. Despite material operational complexities resulting in significant shutdowns of key manufacturing facilities and lower sales volume, Tesla presented better-than-expected margins in the quarter. It expects to launch a lower cost model as soon as late 2024, which should result in accelerated revenue growth, reduced manufacturing costs, and increased factory utilization. The company continued to advance its autonomous driving capabilities, expanding its already significant data centers and developing its humanoid robot Optimus. These investments increased confidence in the attractive growth opportunities that remain ahead.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hegde Fund Investors: 179
Jim Cramer discussed NVIDIA Corporation (NASDAQ:NVDA)’s dominant position in the market, comparing it to a king with the rest of the market’s stocks as its pawns. He expressed concerns about the pressure on NVIDIA Corporation (NASDAQ:NVDA), questioning whether it can maintain its leading role without experiencing significant setbacks. Cramer noted that, based on Larry Williams’ analysis, NVIDIA Corporation (NASDAQ:NVDA) might face a peak and subsequent decline in the near term.
Cramer highlighted that NVIDIA Corporation (NASDAQ:NVDA)’s current chart suggests a peak might occur next week, potentially leading to a sell-off that could extend through mid to late October. He acknowledged that while he hopes Larry’s prediction is wrong, the analysis provides a valid basis for considering a possible downturn, especially if NVIDIA Corporation (NASDAQ:NVDA)’s future outlook does not meet expectations.
“I almost feel like you can guess it—it’s Nvidia. It’s the king, and the rest of the market is made up of its pawns, marching to Nvidia’s drum. Remember this morning when I was on the call and said, “Look, Nvidia is almost too important. There’s too much pressure on Nvidia—can it sustain it? I don’t want Nvidia to be Samson.”
Take a look at this daily chart of Nvidia, going back to February. By the way, Larry, who advised selling Nvidia just before it peaked in the spring, predicted the stock would rise again in late May. Larry and his video calls have closely tracked the stock’s short-term cycle in red, which has followed the share price surprisingly well.
Unfortunately, the short-term cycle now projects that Nvidia should peak sometime next week, leading to a sell-off that may extend through mid to late October. Nvidia reports next week, and the long-term cycle indicates a bottom around the same time. Given that Larry sees Nvidia as the lynchpin of the market, it makes sense that the cycle forecast predicts a downturn for Nvidia, aligning with expectations for the S&P 500.
Yes, Nvidia is that influential. The chart interpreted by Larry Williams suggests that we might experience some pain as August ends, which could continue through mid to late October. I hope he’s wrong this time, but it’s wise to consider his analysis seriously. For my money, there’s a good chance he could be right, especially if Nvidia’s outlook isn’t strong.”
In the second quarter of 2024, NVIDIA Corporation (NASDAQ:NVDA) achieved revenue of $13.5 billion, a 20% increase from the previous year, and earnings per share (EPS) of $3.08, surpassing analysts’ expectations by 10%. This solid performance highlights the company’s effective growth strategy. A key driver of NVIDIA Corporation (NASDAQ:NVDA)’s positive outlook is its leading role in the artificial intelligence (AI) sector.
NVIDIA Corporation (NASDAQ:NVDA)’s GPUs, including the A100 and H100 series, are critical for AI training and inference, positioning NVIDIA as a major player in the AI industry. Additionally, NVIDIA Corporation (NASDAQ:NVDA)’s data center business, which generated $8.5 billion in Q2 2024, has grown significantly due to the rising demand for AI and machine learning technologies.
NVIDIA Corporation (NASDAQ:NVDA)’s market position is further strengthened by strategic partnerships with top tech companies such as Microsoft Corporation (NASDAQ:MSFT) and Alphabet Inc. (NASDAQ:GOOG), boosting its market reach and growth opportunities. The acquisition of Mellanox Technologies also enhances its data center capabilities, setting up the company for continued expansion. With the global semiconductor market expected to grow at a compound annual growth rate (CAGR) of 6.6% through 2028, driven by AI and data center needs, NVIDIA Corporation (NASDAQ:NVDA) is well-positioned to benefit from these trends.
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA), 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 NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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