Jim Cramer’s December Portfolio: Top 10 Stocks to Watch

Page 5 of 5

1. Apple Inc (NASDAQ:AAPL)

Number of Hedge Fund Investors: 158

In a recent program on CNBC, Jim Cramer talked about a Morgan Stanley note on Apple Inc (NASDAQ:AAPL) that discussed how the Cupertino company’s stock could move higher than Nvidia’s. Cramer reiterated his old mantra of staying invested in Apple.

“I think the iPhone upgrade cycle is elongated. This has been my plan for why you’ve got to stay with Apple Inc (NASDAQ:AAPL). Don’t trade Apple; just own Apple, because it’s going to be elongated. And David, the big final thing is competition—a lessening headwind to iPhone demand in China, where Tim Cook is now. China has just been a gigantic headwind.”

Recently, Apple Inc (NASDAQ:AAPL) reclaimed a top-5 position in China’s smartphone market, with its 15.6% market share still down from last year, especially against Huawei, which surged with over 40% growth. Xiaomi also continues to challenge Apple Inc (NASDAQ:AAPL)’s competitive edge. Notably, the iPhone 16 had only about three weeks of Q3 sales, yet didn’t lift Apple Inc (NASDAQ:AAPL)’s market share for the quarter, despite expectations for initial sales to be strong.

Mar Vista Strategic Growth Strategy stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q3 2024 investor letter:

“Apple Inc. (NASDAQ:AAPL) stock was strong in the quarter as investors viewed the company’s generative AI roadmap and iPhone 16 product cycle positively. The market was reminded of the strength of the Apple ecosystem as management demonstrated how generative AI solutions would be integrated into its iOS 18 operating system, which was broadly released in the iPhone 16 late in calendar Q3. We believe Apple’s generative AI-enabled products should spur a meaningful iPhone upgrade cycle and create new avenues of monetization through its app store and advertising offerings. We believe this will support intrinsic value growth that will range between high single digits and low double-digits over our investment horizon.”

While we acknowledge the potential of Apple Inc (NASDAQ:AAPL), 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 AAPL 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. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also look at the 10 Stocks Dominating a Billionaire Quant’s Investment Strategy and the 10 AI News Taking Wall Street by Storm.

Page 5 of 5