Jim Cramer, host of Mad Money, discussed his week’s game plan on Friday, highlighting several companies’ earnings and upcoming inflation reports.
Let’s start our game plan for next week with a recognition that oil’s rally was so easy, it just burst right through the $90s, that it wouldn’t shock me if it went even higher, especially if the shipping companies refuse to go through the Strait of Hormuz, even after being offered insurance… If the president were to open the Strategic Petroleum Reserve for a few weeks, then oil could be crushed. Unfortunately, the reserve’s at half capacity right now, maybe not enough to last through the entire conflict if President Trump’s keeps insisting on Iran’s unconditional surrender.
READ ALSO: Jim Cramer Discussed 11 Stocks: Amazon, Affirm, and More and 11 Stocks on Jim Cramer’s Radar: Target, CoreWeave, and More
Cramer also discussed the upcoming release of the Consumer Price Index, scheduled for Wednesday. He wondered if investors might overlook the report because of the sharp move in oil. However, he said he hopes that does not happen, noting that several major components of inflation, including insurance, food, and rent, have been “going lower.” He added that it is important that inflation at least appear to be easing, because otherwise the Federal Reserve could struggle to justify additional interest-rate cuts given the pressure from rising oil prices.
Cramer said that both the broader economy and the stock market would benefit from lower rates and pointed to the day’s weak employment report as another sign that easing may be needed. He also said a softer CPI reading would give incoming Fed chief Kevin Warsh more ammunition to persuade voting members to continue further rate reductions. He mentioned that he expects a mild inflation number, though he questioned whether it will carry much weight in the current environment.
Finally, on Friday, we got the most important figures for the week. It’s called the Personal Consumption Expenditures data, PCE, which is the Fed’s preferred way to measure inflation. Again, we’re not able to predict oil… this one should go for the bulls. Here’s the bottom line: It is tough to make judgments about the market when we don’t have a clear sense of where this war with Iran is headed and what’s going to happen in oil. But we can still make judgments about individual companies. To me, what’s amazing is that oil did skyrocket 35% in one week, by the way, that was the most in one week ever, and yet the market didn’t crater. Maybe that, and not the oil premium, is the real takeaway.
Our Methodology
For this article, we compiled a list of 9 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 6. We listed the stocks in the order that Cramer mentioned them.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
9 Stocks on Jim Cramer’s Game Plan: Oracle, AeroVironment, and More
9. Ulta Beauty, Inc. (NASDAQ:ULTA)
Ulta Beauty, Inc. (NASDAQ:ULTA) is one of the stocks on Jim Cramer’s game plan. Cramer mentioned the stock during the game plan and said:
Thursday, we get reports from three that I like: DICK’S Sporting Goods, Dollar General, and Ulta Beauty… For the same reason, I think you can buy both Dollar General and Ulta Beauty unless oil makes a quick run to $120. These fit the description of what’s working are bargain offerings, real bargains. They have them. As long as the price of crude doesn’t go insane, it will matter, and these will go higher.
Ulta Beauty, Inc. (NASDAQ:ULTA) provides cosmetics, skincare, haircare, and fragrance products. In addition, the company offers in-store beauty services, including hair, makeup, brow, and skin treatments. During the January 9 episode, Cramer said that Wall Street is “falling back in love with the new Ulta.” He stated:
I always keep an eye on the new high list to understand what’s working. And for the past couple weeks, one of my favorite companies has practically achieved permanent residency status, making a new high almost every day. And I’m talking about Ulta Beauty… Yes, new CEO Kecia Steelman took over a year ago, and boy, she’s managed to orchestrate a pretty impressive turnaround, and that’s why I recommended buying the stock into weakness just a few months ago. But it’s time to revisit it because it’s an even better story…
You’ve got a retailer that is indeed firing on all cylinders. In fact, I’d go so far as to say that it’s looking a lot like the Ulta of old, the innovative growth story that was run by Mary Dillon for so many years before she went to work at Footlocker. Wall Street loved the old Ulta for good reason, and now, it’s falling back in love with the new Ulta. Of course, at this point, we’re no longer early. Ulta’s rallied a quick 27% in just two and a half months since I recommended it. The stock’s not yet super expensive, selling for just over 23 times the year’s earnings estimates. But it’s certainly more expensive than it was before, now trading at a bit of a premium to the overall market versus a slight discount when I recommended it in October… If you didn’t listen to me last time, you know what? I still think you can buy Ulta here and get some exposure to this excellent story, which is not quite a true turnaround story yet, but is definitely getting much better under new management story now.
If you took my word for it in October and you bought the stock, then it’s a hold. Oh, and congratulations on your quick gains, though. Either way, with Ulta stock white-hot here, I mean white-hot, you should be hoping for a market-wide pullback that gives you a chance to load up on this one at a really good level. The bottom line is that Ulta Beauty continues to look better and better and then better some more. The stock’s certainly run a bit at this point, but I think it’s got more upside as the company is starting this new year with more momentum than at any point in ages.
8. Dollar General Corporation (NYSE:DG)
Dollar General Corporation (NYSE:DG) is one of the stocks on Jim Cramer’s game plan. Cramer highlighted it as one of the stocks he likes, as he commented:
Thursday, we get reports from three that I like: DICK’S Sporting Goods, Dollar General, and Ulta Beauty… For the same reason, I think you can buy both Dollar General and Ulta Beauty unless oil makes a quick run to $120. These fit the description of what’s working are bargain offerings, real bargains. They have them. As long as the price of crude doesn’t go insane, it will matter, and these will go higher.
Dollar General Corporation (NYSE:DG) sells everyday essentials, including food, household items, personal care products, and apparel at affordable prices. In addition, it provides seasonal goods, pet supplies, and home products. A caller inquired about the stock during the February 2 episode, mentioning that Cramer recommended it last year. The Mad Money host responded:
I know who you’re talking about. Dollar General… okay. I went to Dollar General… The reason I recommend this stock, I had a fabulous experience at my Dollar General… It was much better than before. I went aisle by aisle by aisle. I know they were thinking what are you, casing the joint? What’s he casing the joint? Because if I want to do a good job for you… I take the stuff that Wall Street does. I take a look at the conference calls, and then I go into my own aisles and see what’s going on. And Dollar General was terrific, and you know what? It remains terrific.
