Jim Cramer’s Lightning Round: 9 Stocks in Spotlight

6. CNH Industrial N.V. (NYSE:CNH)

Number of Hedge Fund Holders: 24

When a caller asked about CNH Industrial N.V. (NYSE:CNH), Cramer said:

“… Second rater, frankly… This company did not move even with Deere doing that well today. I wanna go with best of breed, best of breed is John Deere.”

CNH Industrial (NYSE:CNH) designs, manufactures, markets, and finances a wide range of agricultural and construction equipment, offering financing solutions for customers purchasing new and used machinery. Recently, Greenlight Capital’s David Einhorn shared his views on the company, highlighting his investment in the company. Speaking at CNBC’s Delivering Alpha conference, Einhorn described the agricultural machinery company as an undervalued asset that is currently flying under the radar.

According to Einhorn, the agricultural sector, particularly the equipment market, is nearing the end of a downturn. He pointed out that, while the agricultural equipment industry is currently experiencing low prices and a cyclical downturn, these conditions present an opportunity for potential growth once the cycle turns. As per his remarks, “It’s exactly the kind of situation that absolutely nobody cares about right now because it’s cheap, and the news over the next period of time isn’t going to be very good.”

Einhorn also noted the cyclical nature of the industry, referring to a period in which there was a boom in agricultural equipment purchases, which has since transitioned into a downturn. He stated that agricultural equipment sales are currently 20% below their historical average, a scenario that typically signals the end of a bearish cycle.

He further explained that, in the long term, the industry is likely to experience a rebound, with sales potentially exceeding average levels by 20% within a few years. According to Einhorn, this is a typical pattern for industries that operate on such cycles.