Jim Cramer, host of Mad Money, took to the airwaves on Monday to offer his perspective on the recent market downturn and the S&P 500’s plunge into correction territory last week.
“Let’s establish what we’ve been through, a correction, that’s what we’ve been through. It’s a technical term, meaning a drop of more than 10%, which is what we had in the S&P 500 as of last Thursday.”
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Cramer expressed concern over comments made by Treasury Secretary Bessent, which he found troubling. Bessent, according to Cramer, suggested that corrections are generally healthy for the economy. However, Cramer noted that this correction feels different. He pointed out that most of the business leaders he has spoken with are genuinely concerned about a looming recession. Cramer emphasized that this correction is not caused by the usual factors, such as a change in the Federal Reserve’s stance or a market overreaction. Instead, he believes the primary issue is the fear of a recession triggered by the U.S. government.
Cramer further referenced Bessent’s comments about his 35 years of experience in the investment world, in which he claimed that corrections are normal, but excessive optimism in the market can lead to a financial crisis. Cramer found this viewpoint interesting but also noted that not all corrections are created equal.
“He’s talking like all corrections are the same. That couldn’t be further from the truth. Most corrections are not like the one that we have for the last few weeks. You can get a correction because the Fed changes its stance, the market got too exuberant, foreign problems have been exported to our shores, stuff like that but that’s not what we’re talking about here.”
Cramer highlighted the general public’s concern over the rising levels of government borrowing and the fear that it could lead to an unsustainable economic situation. He added:
“Here’s the bottom line: There doesn’t need to be a transition period of pain. There only needs to be some sort of certainty to the process. If we know what the president’s planning ahead of time and stopping our allies from abusing us, it makes much easier to make investing decisions for businesses and for you. We get that and then the correction’s over. But without it, the market will have a hard time staying positive and we’ll just be glad we had two days to catch our breath before the next beat down.”
Our Methodology
For this article, we compiled a list of 7 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 17. We listed the stocks in ascending order of their hedge fund sentiment as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.
Why are we interested in 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
7 Stocks on Jim Cramer’s Radar
7. Mizuho Financial Group, Inc. (NYSE:MFG)
Number of Hedge Fund Holders: 11
A caller inquired if they should keep buying Mizuho Financial Group, Inc. (NYSE:MFG) or wait for a pullback. Here’s what Cramer said in response:
“Oh, all I can tell you is what Warren Buffett is buying these banks and they sound right. The two mistakes I made was not telling people to buy the Japanese banks and telling people not to buy Santander. And I told them that I could do with a soft Santander, not long. And I think you should stay in or buy Mizuho, great place to be. I wish our banks would do as well as the foreign banks.”
Mizuho (NYSE:MFG) offers a broad range of financial services, including banking, asset management, corporate finance, advisory, and securities services. The company provides solutions in areas such as loans, risk hedging, investment products, consulting, and transaction banking to both individual and corporate clients.
6. Sysco Corporation (NYSE:SYY)
Number of Hedge Fund Holders: 41
A caller asked if it was worth looking into Sysco Corporation (NYSE:SYY) with staples and food stocks getting hit lately and Cramer commented:
“That’s a very, very tough call because while I like Sysco, I do think that that’s the part of the economy that is bleeding right here. So I don’t know if I can endorse it even as I think it’s a terrific company, it may not be the right moment.”
Sysco (NYSE:SYY) markets and distributes a wide range of food and non-food products to the food service industry, including frozen, canned, fresh, and dairy products, as well as tableware, cookware, and cleaning supplies. Parnassus Investments stated the following regarding Sysco Corporation (NYSE:SYY) in its Q4 2024 investor letter:
“We sold two positions in the Consumer Staples sector during the quarter, Sysco Corporation (NYSE:SYY) and Mondelez International. Sysco has not responded convincingly to its industry’s competitive dynamics. Sysco continues to operate in a challenging competitive environment. It has not yet shown signs of improved competitiveness, reducing its resiliency in times of economic downturns. We swapped our position in Sysco for Ferguson.”
5. Walgreens Boots Alliance, Inc. (NASDAQ:WBA)
Number of Hedge Fund Holders: 46
A caller asked Cramer about Walgreens Boots Alliance, Inc. (NASDAQ:WBA) and he said:
“No, it’s over. They’ve got a deal, they’ve got a terrific deal with Sycamore. It just, Mr. Wentworth gave you the best he could and I would just take the, what your position you have off the table and go by Costco, which I think is not gonna need any help whatsoever.”
Walgreens (NASDAQ:WBA) operates as a healthcare, pharmacy, and retail company, offering services such as retail drugstores, health and wellness products, pharmacy services, and specialty care. It also provides healthcare services through primary care, home care, and specialty pharmacy operations. In January, appearing on Squawk on the Street, Cramer commented:
“Oh you know I think there are some good things happening there… I’ve been saying Wentworth is a guy who’s gonna get us out of this. I’m not in, I’m not in it. Tim Wentworth is a genius. We’ve seen him pull rabbits out of hats before.”
4. Texas Roadhouse, Inc. (NASDAQ:TXRH)
Number of Hedge Fund Holders: 52
Inquiring about Texas Roadhouse, Inc. (NASDAQ:TXRH), a caller asked how Cramer’s investing club chooses between the company and Cracker Barrel. Cramer replied:
“Very hard because Julie Masino, we’ve had her on the show, she is just crushing it at Cracker Barrel, crushing it. Texas Roadhouse, Mr. Morgan is doing a good job. Now, I know the stock doesn’t act well and I get that. We’re going to keep building a position as it goes down because they have a long-term history and I can’t believe the price-to-earnings multiple is as low as it is. But you’ve got two winners there.”
Texas Roadhouse (NASDAQ:TXRH) operates casual dining restaurants under various brands, including Texas Roadhouse, Bubba’s 33, and Jaggers, both directly and through franchises. In February, when a caller asked about Wendy’s, Cramer directed them to TXRH and said:
“Wendy’s? No. You’re gonna sell Wendy’s tomorrow and you’re going to buy Texas Roadhouse because that’s the one. We had them on Friday. They’re monster good. We bought it for the Charitable Trust. You’re buying, you’re buying TXRH tomorrow.”
3. Paramount Global (NASDAQ:PARA)
Number of Hedge Fund Holders: 54
A caller asked for help regarding Paramount Global (NASDAQ:PARA) and in response, Cramer said:
“Take the money and run. It’s kind of a done deal. We move on to the next, we find the next big one. I suggest that you actually take a look at Disney, which is really cheap.”
Paramount Global (NASDAQ:PARA) is a media and entertainment company that offers television networks, streaming services, and film production, with a portfolio of well-known brands and studios for both domestic and international distribution. In 2023, when a caller inquired about the company during a lightning round, Cramer said:
“Boy, I’ll tell you the entertainment stocks are so hated, I think you might be able to get this thing two points or three points lower but it’s not expensive anymore.”
Since the comment was aired in September 2023, Paramount Global (NASDAQ:PARA) stock declined more than 9%.
2. Robinhood Markets, Inc. (NASDAQ:HOOD)
Number of Hedge Fund Holders: 79
Highlighting the stock’s 30% decline from its highs, a caller asked if they should continue holding Robinhood Markets, Inc. (NASDAQ:HOOD) or not. Here’s what Cramer had to say:
“No, you should be buying more Robinhood. I think that Vlad Tenev has totally gotten it together. I think that he is smoking the rest of the industry. I like his new predictions thing he just started. You’ve got a winner. Get bigger.”
Robinhood (NASDAQ:HOOD) offers a financial services platform that allows users to invest in various assets, including stocks, ETFs, options, and cryptocurrencies. It provides features such as fractional trading, margin investing, educational resources, and access to tools like credit cards, spending accounts, and wallets. Artisan Partners stated the following regarding Robinhood Markets, Inc. (NASDAQ:HOOD) in its Q4 2024 investor letter:
“During the quarter, we initiated new GardenSM positions in US Foods, Pure Storage and Robinhood Markets, Inc. (NASDAQ:HOOD). Robinhood has emerged as the go-to-trading platform for millennials, boasting approximately 25 million accounts (versus Charles Schwab’s 34 million). The company’s user base skews younger, with deposits growing significantly faster than the broader industry due to several drivers, including the rise of self-directed trading, the generational wealth transfer to millennials and increasing market share. As Robinhood’s customer base matures and accumulates wealth, we believe the company is well positioned to expand its product offerings to meet evolving financial needs. Furthermore, management’s focus on profitable growth and a 90% fixed cost structure suggests meaningful margin expansion potential.”
1. Intercontinental Exchange, Inc. (NYSE:ICE)
Number of Hedge Fund Holders: 91
A caller asked if Intercontinental Exchange, Inc. (NYSE:ICE) would perform long-term and Cramer remarked:
“Oh man, I’ve been a backer of ICE for a long time, I mean really, really long time. Not only that, of course, I’m there every day but that’s just the New York version. You know that’s such a winner. And by the way, it has held up so well. I like your choice. I think you have game.”
Intercontinental Exchange (NYSE:ICE) offers technology and data solutions to financial institutions, corporations, and government entities, focusing on regulated marketplace technology, fixed-income pricing and analytics, and mortgage-related digital platforms. In February, the company reported strong financial results for 2024, with net income of $2.8 billion and revenues of $9.3 billion, which showed a 14% increase in GAAP diluted EPS.
While we acknowledge the potential of Intercontinental Exchange, Inc. (NYSE:ICE) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ICE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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