We recently published a list of Jim Cramer’s Latest Mad Money Episode: Top 10 Stocks to Watch. In this article, we are going to take a look at where The Boeing Company (NYSE:BA) stands against other stocks on Jim Cramer’s top stocks to watch list.
Jim Cramer in a latest program on CNBC made the case for investing in individual stocks to enjoy bigger gains when compared to investing in just the broader market index funds. Cramer said that while it’s “easy” to just park your money in index funds and let the market do the work, investing in individual stocks can give you some “serious gains.”
“I think you should own more than just an index fund because buying individual stocks with special characteristics is how you can rack up some really serious gains. That includes often scoring speculative stocks. Far too often, we become snobs when we talk stocks. So many experts think that if you venture past the index, you could fall off some sort of intellectual cliff that makes any gains null and void. It’s as if the huge swath of points you could have gained simply don’t count. But that, people, is nonsense.”
Cramer said banks do not “care” where the money comes from and neither should investors. He urged investors to not always avoid speculation.
“I come tonight to praise speculation. Here, I’m the only one on TV who actually does this, believe it or not, and to show you how well you could have done if you picked some high flyers for your portfolio and simply held them for the long ride, along with your prosaic, precious index funds.”
READ ALSO: Jim Cramer’s Latest Lightning Round: 11 Stocks to Watch and Jim Cramer on AMD and Other Stocks.
For this article we watched the latest programs of Jim Cramer aired on CNBC and picked 10 stocks he’s talking about. With each company we have mentioned the number of hedge fund investors. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Pixabay/Public Domain
The Boeing Company (NYSE:BA)
Number of Hedge Fund Investors: 42
In a latest lightning round segment of his program on CNBC, Jim Cramer recommended investors to stay away from Boeing Co (NYSE:BA).
“This thing broke down so badly. There are only two of them. This company’s going to lose money for a long time. I prefer not to be in a stock that is going to lose a lot of money for a long time.”
This was a shift from Cramer’s recent comment where he recommended investors to buy the stock on the dip.
“Welcome to the world of duopoly. The worse the financials might be, the better the buy, because as soon as the strike is over and they raise some money, they will be back on the road to profitability. The company is in awful shape, but only two companies can make commercial aircraft. And Boeing is one of them. The demand for planes is off the charts. They will be fine once they raise the cash.”
Jim Cramer was previously bullish on Boeing Co (NYSE:BA). Why? The new CEO was the main reason.
Kelly Ortberg has a degree in Mechanical Engineering, and brings a technical background to the role, a shift from the accounting-focused leadership that investors have found concerning.
Boeing Co (NYSE:BA) is also increasing production rates, having already increased output and reactivated its third 737 MAX assembly line. The company has submitted a comprehensive plan to the FAA, aiming to surpass the current cap of 38 MAX airplanes per month. While these measures will not immediately impact earnings, they signal Boeing Co (NYSE:BA)’s commitment to sustainable growth.
On the certification front, Boeing Co (NYSE:BA) is progressing with solutions for the 737 MAX 7 and MAX 10, and has entered a new phase in the 777X certification campaign. These developments are seen as positive.
Boeing Co (NYSE:BA) has made progress with the 737 MAX program. Boeing Co (NYSE:BA) has reduced traveled work, leading to cleaner fuselages and improved quality and reliability. Boeing’s submission of a comprehensive safety and quality plan to the FAA marks an important milestone. Production has increased from a low single-digit rate in the first quarter to 25 airplanes per month in June and July, though still short of the target of 38 airplanes per month by year-end. This increase suggests progress in managing manufacturing quality.
However, because of worker strikes impact and credit ratings in danger, Boeing Co (NYSE:BA)’s journey back to normality will be long and hard.
Overall, BA ranks 6th on our list of Jim Cramer’s top stocks to watch. While we acknowledge the potential of BA, our conviction lies in the belief that under-the-radar 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 BA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article is originally published at Insider Monkey.