We recently published a list of Jim Cramer on 10 Stocks With The Biggest Declines Last Week. In this article, we are going to take a look at where Axon Enterprise, Inc. (NASDAQ:AXON) stands against other stocks with the biggest declines last week that Jim Cramer discussed.
On Monday, Jim Cramer, the host of Mad Money, analyzed the 10 largest stocks that suffered the most significant declines the previous week. He explained that examining the biggest losers can offer important insights into the current state of the market.
“Last Thursday and Friday were just brutal with the S&P plunging a combined 2.1%, Nasdaq [and] Dow both fell 2.7% as we got some soft economic data paired with some signs that the Fed, they weren’t that eager to make cuts.”
READ ALSO Jim Cramer Suggested Buying These 8 Stocks on Weakness and Jim Cramer Talked About These 12 Stocks Recently
Cramer emphasized that although the average decline was only 2-3% over the two-day selloff. However, focusing on individual stocks, the damage was much worse. He noted that growth stocks, which had been performing well, began to falter starting on Wednesday. Cramer then reviewed the largest pullbacks from the last three days of the week.
He explained that his analysis covered all components of the S&P 1500, specifically those with market capitalizations above $10 billion, ensuring a thorough and rigorous review. And when looking at these names collectively, Cramer noted that there is a lot to learn about the market dynamics. He went on to say:
“First for the hottest of the hot stocks without valuation support, they’re always vulnerable to sharp pullbacks usually it’s because of the bond market. Not this time.”
He added that when investors buy into momentum stocks, the gains can come quickly but just as easily disappear. Furthermore, he pointed out that many companies that were once considered solid performers are now reporting good earnings but offering disappointing guidance, which signals potential trouble ahead. He also noted that the less-than-truckload freight companies are suddenly out of favor, a sign of a weakening economy.
“Here’s the bottom line: At least in the eyes of Wall Street, the US economy’s looking quite a bit worse than it did just a month ago. Fortunately, it’s now a new week and even started off well with some decent gains for most stocks today, although there was a bit of collapse at the close. But we can always learn something from looking at the results of the tape and last week we got a real education from the momentum buyers trapped in the school of hard knocks.”
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on February 24. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock 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).
A technician in a white coat testing an in-car system on a modern military vehicle.
Axon Enterprise, Inc. (NASDAQ:AXON)
Number of Hedge Fund Holders: 64
Cramer noted Axon Enterprise, Inc.’s (NASDAQ:AXON) remarkable performance over time, despite its recent decline. Formerly known as TASER, the company experienced a significant drop of almost 28% within just three days. Cramer pointed out the company’s impressive track record of success in previous years. He added:
“It pivoted… to police body cameras, evidence management software Those were good businesses. So why then did the stock just get completely obliterated? Weirdly, there really wasn’t any bad news from the company. Instead, it was a one-two punch of downgrades from analysts at boutique research firms that failed Axon. The first from Northcoast caused the stock to sink more than 16% last Wednesday before another downgrade from Craig-Hallum caused it to fall over 8% on Thursday.
The stock fell another 5% on Friday when the market-wide selling really got going. Now Axon reports tomorrow after the close, but clearly, people wanted to ring the register going into the quarter and the bearish analysts gave them a real excuse to do so. Very different attitude from what we’ve seen in the past few months, huh, where momentum stocks are frankly unstoppable.”
Axon Enterprise, Inc. (NASDAQ:AXON) is a company specializing in the development of TASER devices and offering both hardware and cloud-based software solutions to assist law enforcement in capturing, storing, managing, and analyzing digital evidence.
Overall, AXON ranks 1st on our list of stocks with the biggest declines last week that Jim Cramer discussed. While we acknowledge the potential of AXON 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 timeframe. If you are looking for an AI stock that is more promising than AXON but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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