In this article, we will take a look at the 10 Jim Cramer stocks this month.
Jim Cramer on January 31 announced that we are in a bull market so investors should buy the dip. Cramer’s comments were validated on the back of the huge optimism that prevailed after the Federal Reserve indicated that its rate hikes were working. Fed chair Jerome Powell at the start of February said that it could be said for the “first time” that the “disinflationary process” has started. These comments gave a huge boost to the market. Tech stocks and cryptocurrencies also rallied. However, a stronger-than-expected jobs report for January dashed this optimism as analysts agreed that the stubborn growth in the labor market will affect the Federal Reserve’s decision making process when it comes to rate hikes.
Jim Cramer’s stance is also showing signs of caution. Cramer recently said that people should not ignore investing fundamentals even during a bull market.
“I just want you to have a real earnings cushion with real buybacks or real dividends — ideally both — and I can’t feel comfortable recommending anything without them,” Cramer said, during his “Mad Money” program on CNBC.
“Back to Basics”
Moving beyond the debate of whether we are in a bull market or bear market, the fact remains that long-term investors almost always see market downturns as investing opportunities. A JPMorgan report on the outlook and assumptions for the stock market in 2023 says that lower valuations and higher yields mean that asset markets today offer the best long-term returns in more than a decade. The report said that the stock market turmoil of 2022 might have created “investment opportunities in the years ahead.”
JPMorgan’s report theme and title was “back to basics” which highlights the importance of age-old, time-tested investing principles which still “hold firm” according to the investment firm. The report said that the 60/40 portfolio can form the bedrock of portfolios, while alternatives can offer alpha, inflation protection and diversification.
JPMorgan said that despite the geopolitical headwinds and recession fears, its estimates for global growth over the next decade or so are unchanged at 2.20%. The firm said that the headwinds that battered the market are expected to spill over into 2023, providing opportunity for investors who are looking for attractive entry points.
“With policy rates likely to rise further over the next year, investors will also be penalized less for opportunistically holding some cash in the short term in order to take advantage of any further dislocations in asset markets.”
Our Methodology
For this article, we went through Jim Cramer’s Mad Money episodes aired in February through February 10 on CNBC and picked the most notable stocks the journalist and investor is bullish on. Most of these stocks have long-term fundamentals according to Cramer. That’s why these stocks are decent picks for not only this month but for the long-term as well.
Jim Cramer Stocks This Month
10. EMCOR Group, Inc. (NYSE:EME)
Number of Hedge Fund Holders: 27
EMCOR Group, Inc. (NYSE:EME) is a Connecticut-based engineering and construction company. EMCOR Group, Inc. (NYSE:EME) has weathered the market storm of 2022 as it has been up about 25% over the past twelve months as of February 10.
During a “lightning round” on his recent program, Jim Cramer said that EMCOR Group Inc (EME) was “my kind of stock.” He further said the following about the company:
“That’s exactly what I’m looking for.”
EMCOR Group, Inc. (NYSE:EME) is one of the safer plays in the market. EMCOR Group, Inc. (NYSE:EME) also pays dividends. In January, EMCOR Group, Inc. (NYSE:EME) declared a dividend of $0.15 per share. In October 2022, when companies were struggling amid the market turmoil, EMCOR Group, Inc. (NYSE:EME) announced a 15% dividend hike for its shareholders.
As of the end of the third quarter of 2022, 27 hedge funds tracked by Insider Monkey reported owning shares in EMCOR Group, Inc. (NYSE:EME).
TimesSquare Capital made the following comment about EMCOR Group, Inc. (NYSE:EME) in its Q3 2022 investor letter:
“Offsetting that somewhat was the 12% return posted by EMCOR Group, Inc. (NYSE:EME), which provides construction and operational services for mechanical and electrical systems to a broad range of commercial, industrial, utility, and institutional customers. As an industrial company well-positioned to pass along higher costs and maintaining its margins, EMCOR reported higher-than-anticipated revenues and earnings, increased guidance for the balance of the year, and authorized an additional $500 million share repurchase plan. There was a healthy backlog of orders for refinery services, building retrofits, construction, and advanced industrial areas.”
9. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 112
The Walt Disney Company (NYSE:DIS) has been all over the news lately amid the company’s restructuring plans and its fight with a hedge fund. Jim Cramer recently praised The Walt Disney Company (NYSE:DIS) CEO Bob Iger’s restructuring and cost-cutting plan. Cramer said during his recent program that it seems like The Walt Disney Company (NYSE:DIS) is “back on track.” So far in 2023, The Walt Disney Company (NYSE:DIS) is up over 24% through February 10. Cramer said that while The Walt Disney Company (NYSE:DIS) has gained a lot in 2023, he believes it has more upside potential now that the CEO is turning things around.
Several factors are helping The Walt Disney Company (NYSE:DIS) stock. The Walt Disney Company (NYSE:DIS) recently posted strong quarterly results and announced to cut about 7,000 jobs. The Walt Disney Company (NYSE:DIS) also aims to restore its dividend this year. In another news, Nelson Peltz of Trian Partners has indicated that his proxy fight with The Walt Disney Company (NYSE:DIS) is over following the company’s announcement of a restructuring plan.
Madison Funds made the following comment about The Walt Disney Company (NYSE:DIS) in its fourth-quarter 2022 investor letter:
“The Walt Disney Company (NYSE:DIS) reported a disappointing fourth quarter with revenue and earnings below consensus which was followed by the board replacing then-CEO Bob Chapek and the return of Bob Iger as CEO. Parks remained a bright spot while losses at direct-to-consumer increased and linear networks continued to be challenged by cord cutting.”
8. Parker-Hannifin Corporation (NYSE:PH)
Number of Hedge Fund Holders: 45
Parker-Hannifin Corporation (NYSE:PH) ranks 8th in our list of the Jim Cramer stocks to watch this month. Earlier this month, Jim Cramer said that Parker-Hannifin Corporation (NYSE:PH) is “just the kind of industrial” he’s been recommending.
“I would buy it here,” announced Cramer.
Parker-Hannifin Corporation (NYSE:PH) is another defensive play Jim Cramer has been picking during the current environment.
As of the end of the third quarter of 2022, 45 hedge funds reported owning stakes in Parker-Hannifin Corporation (NYSE:PH), according to Insider Monkey’s database of 920 hedge funds’ holdings. This was up from 35 hedge funds that had stakes in Parker-Hannifin Corporation (NYSE:PH) in the previous quarter. This shows that the hedge fund sentiment around Parker-Hannifin Corporation (NYSE:PH) is positive.
Here is what Stewart Asset Management has to say about Parker-Hannifin Corporation (NYSE:PH) in its Q3 2022 investor letter:
“”We also need to point out one global consequence of the rapid rise in interest rates: an irrepressibly strong dollar. This hurts the reported earnings of U.S. companies who sell their goods and services overseas. Foreign currency earnings translate into fewer dollars and thus lower earnings. Most of the companies in your portfolios gain a notable amount of earnings from their international operations. While the strength or weakness of a currency doesn’t change the quality of a business or its longer-term earnings power, it can change the reported earnings of a company over short periods of time. It is difficult to forecast this effect accurately because many of our companies manufacture where they sell, which to some extent dulls the sharp negative effect of a surging dollar. Others sell goods that are priced in dollars such as Parker-Hannifin’s (NYSE:PH) aerospace products.
7. ConocoPhillips (NYSE:COP)
Number of Hedge Fund Holders: 64
Another defensive safe play Jim Cramer is recommending to his fans is ConocoPhillips (NYSE:COP). Jim Cramer recently said the following about the oil company during one of his recent programs:
“That thing is like a fine Merlot, my friend. I would buy all you can right here.”
ConocoPhillips (NYSE:COP) is another oil stock that pays strong dividends. ConocoPhillips (NYSE:COP) is also popular among smart money. Insider Monkey’s database of 920 hedge funds shows that 64 hedge funds had stakes in ConocoPhillips (NYSE:COP) at the end of the third quarter of 2022. The total value of these stakes was about $2.7 billion.
ClearBridge Investments made the following comment about ConocoPhillips (NYSE:COP) in its Q3 2022 investor letter:
“ConocoPhillips (NYSE:COP) handily outperformed the energy sector, which led the value benchmark. Its exposure to natural gas helped the stock perform more in line with natural gas E&Ps, which led the sector due to the European energy crisis and U.S. shale gas being considered a secure long-term source of liquid natural gas. In addition to COP’s low-cost resource base, conservative balance sheet and experienced management team, we appreciate its strong focus on ESG measures, which we believe is a good indicator of the quality of a company’s business model and management team.
Specifically, we appreciate solid governance practices with compensation metrics emphasizing ROCE and relative total shareholder return, the board’s effective oversight of management as well as the company’s methane flaring leadership. COP is investing in field electrification and carbon capture across its portfolio, with ambitions to deliver oil production with a CO2 intensity of sub-5 kg/BOE, which would be one of the lowest emission sources of supply in the world.”
6. Snowflake Inc. (NYSE:SNOW)
Number of Hedge Fund Holders: 73
Snowflake Inc. (NYSE:SNOW) investors have been cheering the stock’s rally in 2023. The Cloud company’s stock has gained about 20% so far in 2023 through February 10. Jim Cramer also likes Snowflake Inc. (NYSE:SNOW). Cramer expressed confidence in Snowflake Inc. (NYSE:SNOW)’s CEO Frank Slootman and said:
“I like Snowflake. I will go with Slootman. He is a money maker.”
In January, Snowflake Inc. (NYSE:SNOW) shares jumped after Canaccord Genuity said the company is well-positioned to benefit from the consolidation in the database and data warehousing markets. The firm set a price target of $195 for Snowflake stock.
As of the end of the third quarter of last year, 73 hedge funds reported owning stakes in Snowflake Inc. (NYSE:SNOW), up from 66 funds in the previous quarter. This shows that hedge funds were piling into Snowflake Inc. (NYSE:SNOW) despite a massive rotation away from tech towards value during last year.
5. Activision Blizzard, Inc. (NASDAQ:ATVI)
Number of Hedge Fund Holders: 96
Jim Cramer is extremely bullish on gaming giant Activision Blizzard, Inc. (NASDAQ:ATVI), which has been in the news due to its planned merger with Microsoft. The merger is facing regulatory hurdles, though, and Cramer likes that. Cramer said that he “almost” hopes that Activision Blizzard, Inc. (NASDAQ:ATVI)’s merger with Microsoft fails as soon as possible so that “you’ll get a better buying opportunity.” Cramer thinks that Activision Blizzard, Inc. (NASDAQ:ATVI) doesn’t need the acquisition by Microsoft to keep performing well.
At the end of the third quarter of 2022, 96 hedge funds reported having stakes in Activision Blizzard, Inc. (NASDAQ:ATVI), according to Insider Monkey’s database of 920 hedge funds. The biggest stakeholder of Activision Blizzard, Inc. (NASDAQ:ATVI) during this period was Warren Buffett’s Berkshire Hathaway which owns a stake worth about $4.5 billion in the company.
4. Cintas Corporation (NASDAQ:CTAS)
Number of Hedge Fund Holders: 42
Ohio-based Cintas Corporation (NASDAQ:CTAS) make and sells a lot of important items and that’s why the company is poised to do well given the current environment where diversification of revenue streams is the key. Cintas Corporation (NASDAQ:CTAS) sells corporate apparel, mats, mops, cleaning and restroom supplies, first aid and safety products. Jim Cramer gave some very bullish comments about the company in his program on CNBC earlier this month. Cramer said:
“It’s one of the greatest small business companies in the world.”
Hedge funds seem to agree with Cramer, as Insider Monkey’s data shows that they piled into Cintas Corporation (NASDAQ:CTAS) last year. At the end of the third quarter of 2022, 42 hedge funds had stakes in Cintas Corporation (NASDAQ:CTAS), significantly up from 32 hedge funds in the previous quarter. The biggest stakeholder of Cintas Corporation (NASDAQ:CTAS) during this period was Ian Simm’s Impax Asset Management which owns a $386 million stake in the company.
TimesSquare Capital made the following comment about Cintas Corporation (NASDAQ:CTAS) in its Q3 2022 investor letter:
“Cintas Corporation (NASDAQ:CTAS), a supplier of corporate identity uniforms and facility services, gained 4%. Fiscal first quarter results featured beats to revenue and earnings estimates. The company is successfully winning new business and cross-selling into existing customers.”
3. Netflix, Inc. (NASDAQ:NFLX)
Number of Hedge Fund Holders: 115
Netflix, Inc. (NASDAQ:NFLX) is one of the Jim Cramer stocks to watch this month and for several months to come as the investor has recommended his fans to “stick with” the streaming giant’s shares. Jim Cramer said:
“You got the pain, you get the gain. Stick with it.”
Netflix, Inc. (NASDAQ:NFLX) has taken several steps to reinvigorate growth. Nielsen’s data shows that Netflix, Inc. (NASDAQ:NFLX) topped the list of most-streamed programs in 2022. Netflix, Inc. (NASDAQ:NFLX) is also moving to stop password sharing. Analysts believe in the long run this could increase subscriber growth. However, some surveys indicate people who were using someone else’s password for Netflix, Inc. (NASDAQ:NFLX) will not sign up for the service after the company’s latest move.
A total of 115 hedge funds tracked by Insider Monkey reported owning stakes in Netflix, Inc. (NASDAQ:NFLX) at the end of the third quarter of 2022, up from 95 funds in the previous quarter.
Alger Capital made the following comment about Netflix, Inc. (NASDAQ:NFLX) in its Q4 2022 investor letter:
“Netflix, Inc. (NASDAQ:NFLX) provides a subscription-based service for streaming movies and television episodes over the internet. In doing so, it is redefining how people consume entertainment in a rapidly digitizing world. Shares outperformed during the period as the company reported solid third quarter results, driven by net subscription additions that beat expectations. Management also raised fiscal fourth quarter guidance owing to strong customer acquisitions across all regions. Moreover, the company remains optimistic on new monetization efforts around ad pricing within their basic account tier.”
2. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 177
Meta Platforms, Inc. (NASDAQ:META) investors have finally something to cheer about as the company’s most recent quarterly results shows growth might be returning to Facebook platform. Jim Cramer earlier this month said in his program that Meta Platforms, Inc. (NASDAQ:META) is a case in point showing why it pays to stick with companies that are “incredibly well managed, or disciplined, or efficient.”
On a year-to-date basis Meta Platforms, Inc. (NASDAQ:META) stock has gained about 42% through February 10.
Some believe Meta Platforms, Inc. (NASDAQ:META)’s efforts to build its business around the metaverse technology has failed. However, Meta Platforms, Inc. (NASDAQ:META) can still profit from its long-term metaverse bets while focusing on its existing social media platforms. BlackRock recently said in a note that “investment opportunities are here and now” in the metaverse domain.
“At this juncture, it is much like the internet of the early 1990s or the smartphone of the early 2000s: We expect it is going to be big, and very likely change people’s daily lives,” BlackRock said.
Vulcan Value Partners made the following comment about Meta Platforms, Inc. (NASDAQ:META) in its Q4 2022 investor letter:
“During the quarter we sold Meta Platforms, Inc. (NASDAQ:META) after owning the business for over four years. The fundamentals of our investment case were based on the tremendous number of users that spent time on its various properties and the advertising dollars that flowed to the company as a result. We believed its competitive advantage was that the platform was, more or less, a monopoly on people’s time and attention. The rise of TikTok and other emerging platforms has given us pause on the company’s ability to maximize that advantage. From our perspective, the idea of “one platform to rule them all” may now be a thing of the past as social offerings have become more fragmented.
In addition, though our research has indicated that much of the initial damage done from Apple’s iOS 14.5 privacy changes has been repaired, we remain concerned with Apple’s influence over the digital advertising ecosystem. Apple is one of the largest gatekeepers to Meta’s mobile services, and it has become more difficult for us to gauge the pace of change emerging from Apple relating to privacy, as well as evaluating Apple’s ambitions in advertising…” (Click here to read the full text)
1. Etsy, Inc. (NASDAQ:ETSY)
Number of Hedge Fund Holders: 45
Earlier this month, Jim Cramer recommended young investors to buy Etsy, Inc. (NASDAQ:ETSY). Cramer said that Etsy, Inc. (NASDAQ:ETSY) could post long-term gains for investors who are willing to stomach some short-term risks. Cramer thinks Etsy, Inc. (NASDAQ:ETSY)’s underlying business is solid.
In January, Wolfe Research started covering the stock with a Peer Perform rating. The analyst thinks Etsy, Inc. (NASDAQ:ETSY) offers a “differentiated consumer value proposition” and an “attractive profitability profile.”
Etsy, Inc. (NASDAQ:ETSY) saw a sharp increase in hedge fund sentiment during the third quarter of 2022. A total of 45 hedge funds tracked by Insider Monkey reported owning shares in Etsy, Inc. (NASDAQ:ETSY) at the end of the September quarter, much more than 29 hedge funds in the previous quarter. The biggest stakeholder of Etsy, Inc. (NASDAQ:ETSY) was Natixis Global Asset Management’s Harris Associates which owns a $190 million stake in the company.
Here is what ClearBridge Investments Mid Cap Growth Strategy has to say about Etsy, Inc. (NASDAQ:ETSY) in its Q3 2022 investor letter:
“Stock selection in the consumer discretionary sector proved a tailwind to performance. Etsy (NASDAQ:ETSY), which operates a number of online marketplaces for craft and artisan goods, delivered second quarter results that demonstrated the company’s pricing power, cash flow generation, and margin upside remain intact. While Etsy is experiencing declines in gross merchandise sales, it is seeing better than expected take rates and improved margins. We believe the company is well-positioned to grow advertising spending on its marketplace, bring in new buyers and strengthen its e-commerce advantages.”
You can also take a peek at 10 Hot Tech Stocks To Buy Now and 10 Hot Healthcare Stocks To Buy Now.
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Disclosure: None. 10 Jim Cramer Stocks This Month is originally published on Insider Monkey.
