In this article, we discuss 11 Jim Cramer stock picks this week.
Love him or hate him, it’s a fact that Jim Cramer’s stock picks and commentary gain a wide attention. Cramer is always ready to provide hints on possible winners and losers His commentary is often bold and his bets often blunt, without any fear of being proven wrong. While many investors follow his stock picks, others opt to trade the inverse of what he recommends. The formation of an inverse Jim Cramer strategy whereby investors trade the opposite of what the CNBC commentator suggests is becoming increasingly popular.
Betting against Cramer’s recommendations would have yielded a year-to-date return of 15%, barely beating the market by half a percentage. Investors who have traded the inverse of the commentator’s recommendations have enjoyed a return of up to 22% over the past year. Some of the stocks that have generated significant returns in the inverse Cramer strategy include C3.ai, Inc. (NYSE:AI), Enphase Energy, Inc. (NASDAQ:ENPH), Advanced Micro Devices, Inc. (NASDAQ:AMD), Ford Motor Company (NYSE:F), and Oracle Corporation (NYSE:ORCL).
However, Cramer has been right in his calls on several occasions. Apple Inc. (NASDAQ:AAPL) has been one of his top picks for the year. The stock has gone on to gain more than 40% year to date on benefiting from the tech bull rally.
Cramer has also been bullish on NVIDIA Corporation (NASDAQ:NVDA), a stock that has taken the market by storm, tripling in value and becoming a trillion-dollar company. Other top performers in his portfolio include Meta Platforms, Inc. (NASDAQ:META), Tesla, Inc. (NASDAQ:TSLA), Alphabet Inc. (NASDAQ:GOOGL), and Amazon.com, Inc. (NASDAQ:AMZN), all of which have posted more than 40% yearly gains.
Cramer also has an edge in calling out big winners outside tech. Some of his little-known gems that have rallied to 52-weeks highs and generated significant returns include Darden Restaurants, Inc. (NYSE:DRI), Molson Coors Beverage Company (NYSE:TAP), Biogen Inc. (NASDAQ:BIIB), Cardinal Health, Inc. (NYSE:CAH), and Berkshire Hathaway Inc. (NYSE:BRK-A).
Cramer recently warned of the need to be extremely cautious on stocks that continue to rally on the back of no solid underlying fundamentals in what he deems a frothy situation.
The CNBC commentator is also staying clear of Merck & Co., Inc. (NYSE:MRK), insisting that the drug maker faces increased competition and regulatory pressure for its lead products such as Keytruda. Cramer’s Trust has also exited its position on Johnson & Johnson (NYSE:JNJ) on concerns about the legal issues that the company faces with its baby powder and talc products. The analyst is also downbeat about Verizon and sees little growth.
Our methodology
We have compiled a list of stocks Jim Cramer believes have a significant upside potential compared to their peers. The stocks were picked from the CNBC commentator’s recent shows on Mad Money, where he interacts with callers providing insights on how he believes different stocks will perform. We ranked the stocks based on the upside potential which was calculated on the basis of average analyst price estimates for these stocks.
11. PACCAR Inc (NASDAQ:PCAR)
Upside Potential: 8.89%
Price target: $92.44
According to Cramer, PACCAR Inc (NASDAQ:PCAR) is a great American company for anyone looking for some exposure in the auto industry. The stock has already rallied to its 52-week high after gaining more than 35% year to date.
The rally comes at the back of an impressive record of positive earnings surprises. PACCAR Inc has not missed earnings consensus over the past four quarters, having delivered earnings of $2.25 a share for Q1 against $1.82 a share expected.
At the start of the second quarter, PACCAR Inc inked a strategic partnership with Toyota to develop Kenworth and Peterbilt trucks powered by Toyota Hydrogen fuel cells. Wall Street is overly optimistic about Paccar with Ana’s verge price target of $92.44, which implies an 8.89% upside potential.
10. Micron Technology, Inc. (NASDAQ:MU)
Upside Potential: 8.88%
Price target: $75.22
According to Cramer, Micron Technology, Inc. (NASDAQ:MU) is a worthy stock to own for gaining some exposure in the burgeoning semiconductor sector. With the company looking to push the envelope in the AI memory market with its product development, it boasts tremendous potential
According to Cramer, Micron Technology, Inc. is well-positioned to benefit from the global chip shortage as it has a significant supply that meets demand from various sectors, including gaming, computing, and smartphones.
In addition, the CNBC commentator believes the chip giant is trading at a cheap valuation compared to its peers, thus, well poised to benefit amid the AI fueled rally.
According to the analyst, buying Micron Technology, Inc. on weakness would be an ideal play. The stock commands a $75.22 average price target implying an 8.88% upside potential.
9. U-Haul Holding Company (NYSE:UHAL)
Upside Potential: 8.94%
Price target: $64
U-Haul Holding Company (NYSE:UHAL) has outperformed the market in 2023 despite being a seasonal stock over the years. The stock is already up by more than 30% for the year, and Cramer believes it still has significant upside potential.
There were concerns that U-Haul Holding Company’s core business of renting trucks, trailers portable moving storage units would be hurt by more people opting to remodel houses instead of moving. However, that has yet to be the case.
The storied do-it-yourself specialist benefits from moving activity bouncing back to historic trends.
According to Cramer, U-Haul Holding Company is an inexpensive stock that should continue increasing. The stock commands a $64 average price target implying 8.94% upside potential.
8. Western Alliance Bancorporation (NYSE:WAL)
Upside Potential: 10.42%
Price target: $57.55
Western Alliance Bancorporation (NYSE:WAL) is another regional bank under immense pressure amid the banking crisis early in the year. The stock imploded from $71 a share to $26 per share in three days in March after the Silicon Valley bank blew up. The sell-off came amid concerns that the bank’s depositors were fleeing.
Fast forward, the bank’s genuine deposits grew significantly in the second quarter, shrugging any concerns of a bank run. According to Cramer, the 50% run from 2023 lows is justified, and Western Alliance Bancorporation is well poised to continue edging higher, considering it is still down from its highs. Wall Street expects the stock to rally by 10%, going by the $57.55 average price target.
7. Marvell Technology, Inc. (NASDAQ:MRVL)
Upside Potential: 12.94%
Price target: $70.42
Marvell Technology, Inc. (NASDAQ:MRVL) is one stock Cramer believes could rally to $75 a share after an impressive second quarter. The chip company is benefiting from the AI boom and looks set to follow in the footsteps of Nvidia.
The company has acquired a portfolio of Ethernet and application-specific integrated chip technology, positioning it to benefit from the AI boom. Marvell Technology, Inc. also boasts a robust ASIC business that designs custom chips for specific purposes.
While the stock is up by about 80% year to date, Cramer believes it is best to wait for a pullback before pulling the trigger. Marvell Technology, Inc. commands an average price target of $70.42 on Wall Street, implying a 12.94% upside potential.
6. Zions Bancorporation, National Association (NASDAQ:ZION)
Upside Potential: 13%
Price target: $42
Zions Bancorporation, National Association (NASDAQ:ZION) is another regional bank that Cramer remains confident about as it continues to pick its pieces after the banking crisis.
Like Western Alliance, Zions Bancorporation, National Association has had net inflows of deposits. While the stock has rallied by more than 40% from its 2023 lows, Cramer believes there is still some room for the stock to edge higher.
5. Nucor Corporation (NYSE:NUE)
Upside Potential: 14%
Price target: $195
According to Cramer, Nucor Corporation (NYSE:NUE) is a buy for anyone looking to gain exposure to manufacturing and steel. The company produces sheet steel products and has been in a fine form amid accelerated industrial activities. The stock is up by more than 30%, outperforming the S&P 500, that’s up by about 18%
While Cramer is also bullish on Cleveland-Cliffs Inc. (NYSE:CLF), he believes Nucor Corporation is a better option. The stock has a high price target of $195, implying a 14% upside potential.
4. PacWest Bancorp (NASDAQ:PACW)
Upside Potential: 26.42%
Price target: $11.39
PacWest Bancorp (NASDAQ:PACW) is one of the stocks that was hit hard at the height of the banking crisis at the start of the year. However, the bank holding company appears to have found its foot, and Cramer believes it is a worthy play for the long term.
The bank is currently discussing merging with the Bank of California in an all-stock merger. The combined bank will have the strength and market position to support the banking needs of small and medium-sized businesses. PacWest Bancorp has the potential to rally 26% vroom current levels given its $11.39 average price target on Wall Street.
3. Endava plc (NYSE:DAVA)
Upside Potential: 44.40%
Price target: $70.57
Endava plc (NYSE:DAVA) is another high-profile stock that Cramer recommends as it is poised to benefit from the AI boom. The consulting company, which helps businesses modernize their technology, has been growing at an impressive rate over the last several years and is already making money.
Over the past few years, Endava plc (NYSE:DAVA)’s revenue has grown at a compound annual growth rate of 32%. The company is also growing its customer base at a rapid pace, with 155 clients bringing in over 1 million pounds in revenues. With an average price target of $70.57, the stock could rally 44% from current levels.
2. Biohaven Ltd. (NYSE:BHVN)
Upside Potential: 46%
Price target: $28
Biohaven Ltd. (NYSE:BHVN) is one stock Cramer believes has significant upside potential despite the company suffering major setbacks. The US Food and Drug Administration did not approve the company’s Troriluzole candidate drug for treating an Ultra rare neurodegenerative disorder on failing to meet its primary endpoint.
While Biohaven Ltd. has pulled back nearly 20% from its 2023 highs, Cramer remains confident about its long-term prospects. He is especially confident about its Nurtec drug, a medication for migraine. The average consensus price target on the stock is $28, implying a 46% upside potential.
1. SoFi Technologies, Inc. (NASDAQ:SOFI)
Upside Potential: 57%
Price target: $16
SoFi Technologies, Inc. (NASDAQ:SOFI)’s fortunes and sentiments have improved significantly amid news that federal student loan repayments will resume in the fall as a moratorium that started during the COVID-19 pandemic ends.
According to Cramer, given the improving underlying fundamentals, the stock has what it takes to continue climbing.
Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out our articles on 20 Best-Funded AI Startups in 2023 and Jim Rogers’s Latest Predictions and Investments.
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This article is originally published at Insider Monkey.
