Jim Cramer, the host of Mad Money, took a moment on Wednesday to reflect on the latest market developments as earnings season progresses, sharing his thoughts on how investors can identify stocks that are unfairly punished and present solid buying opportunities.

“This market has the memory of a mayfly that creates a ton of opportunities so… I want to help you find them.”

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Cramer stressed that time and again, he has seen growth stocks severely impacted by minor bits of bad news, such as small downgrades or slight concerns about a quarter’s performance. In these cases, he noted, the punishment rarely fits the crime, if a real issue even exists.

Cramer also recently weighed in on the ongoing trade tensions with China. He urged Wall Street to start taking President Trump’s policies more seriously, pointing out that Trump had negotiated a deal that granted China a much lower tariff than Canada received. Cramer dismissed the idea that China’s response was an equal counterattack, calling such a notion “nonsense” and “idiocy.” He added:

“Now, if Wall Street took Trump seriously, they’d know that China played softball with its retaliation just like Trump played softball with that 10% tariff.”

He elaborated that much of the recent panic, which had escalated on Sunday night, shifted a bit to optimism, as people began to realize that the president had managed to negotiate a deal. Acknowledging the presence of hardliners within the White House who are keen on taking a tougher stance on China, Cramer noted that those individuals had lost the battle.

He pointed out that Trump’s objective was to broker a deal that could generate revenue for the U.S. Treasury while providing American businesses with opportunities in China. Cramer emphasized that this goal should have been clear to anyone who had been watching the Chinese stock market, as stocks that trade in China surged recently.

Our Methodology

For this article, we compiled a list of 13 stocks that were discussed by Jim Cramer during the episode of Mad Money on February 5. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the third quarter of 2024, which was taken from Insider Monkey’s database of 900 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

Jim Cramer Highlighted Buying Opportunities in 13 Stocks

13. Palantir Technologies Inc. (NASDAQ:PLTR)

Number of Hedge Fund Holders: 43

Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of software solutions that specialize in complex data integration and decision-making. Commenting on the company, Cramer said, “Oh, and, let’s not forget the ontologists at Palantir. Those guys can do no wrong, especially in the eyes of their buddy-buddy investors.”

Cramer has been bullish on Palantir (NASDAQ:PLTR) for a few months now and recently, he said:

“You hold it, you hold it and when it crops back down, you buy back the stock that you sold because this company is a winner. They have really smart people and a lot of good contracts. It’s the best data analysis company in the world, Palantir.”

12. Palo Alto Networks, Inc. (NASDAQ:PANW)

Number of Hedge Fund Holders: 64

Palo Alto Networks, Inc. (NASDAQ:PANW) is a cybersecurity company that provides a wide range of security solutions. During the episode, Cramer said, “CloudFlare and Palo Alto Networks, they’re comeback kids too, every time.”

According to Cramer, Palo Alto’s (NASDAQ:PANW) CEO has turned it around as he stated in January:

“This one is Nikesh Arora. When he took over at Palo Alto Networks, PANW, a once powerful cybersecurity company that had fallen behind the others, people thought turning this business around was too big a task. At best, he’d just be a deal maker and a so-so one at that. I knew Nikesh is [a] brilliant competitive guy whom I wanted to bank with, which is why we bought the heck outta the stock… Now, Palo Alto had a $19 billion market capitalization when Nikesh took over on June 6th, 2018, it’s now worth $123 billion. He created $104 billion in value.”

11. Cloudflare, Inc. (NYSE:NET)

Number of Hedge Fund Holders: 44

Cloudflare, Inc. (NYSE:NET) provides cloud-based services that focus on security, performance, and connectivity, offering solutions like integrated security, network products, and edge computing services with AI accelerators for developers. Cramer stated, “CloudFlare and Palo Alto Networks, they’re comeback kids too, every time.”

In November 2024, discussing Cloudflare (NYSE:NET) before it released its earnings report, Cramer remarked, “This is a network security play we’ve had on quite a bit. I think it’s got a great setup.”

Parnassus Investments stated the following regarding Cloudflare, Inc. (NYSE:NET) in its Q3 2024 investor letter:

“In Software, we added Autodesk and Cloudflare, Inc. (NYSE:NET) while exiting Bill.com. Cloudflare has built its own internet network, providing its customers with lower latency and better security. Cloudflare allows companies to access the internet faster and with greater security. The company is building new offerings on top of its network, allowing it to widen its competitive moat with high incremental margins. Cloudflare has a large addressable market that we believe provides a long runway for growth.”

10. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)

Number of Hedge Fund Holders: 74

Cramer pointed to how CrowdStrike Holdings, Inc. (NASDAQ:CRWD) stock recovered after its CEO apologized for an issue with the company’s software update that led to a global outage in 2024.

“Finally, cybersecurity. Now, just over six months ago, a glitch caused by CrowdStrike seemed to stall the whole world. Then the CEO George Kurtz, truly an indefatigable gem, visits 130 companies in a hundred days for a genuine apology tour and all’s forgotten and forgiven. In response, the stock quickly takes out its old high. Can you believe this?”

CrowdStrike (NASDAQ:CRWD) offers a comprehensive cybersecurity platform that provides cloud-based protection for endpoints, cloud workloads, identity, and data, along with services such as threat intelligence, AI-powered automation, and security management. It primarily generates revenue through subscriptions to its Falcon platform and cloud modules. Cramer has been a fan of the company and its CEO for some now and in January, he commented:

“I think CrowdStrike is going up big from here. I think that [the] cybersecurity business is terrific. I think that they are just now beginning to play offense after that glitch that occurred. I do think that this is the time to own CrowdStrike and to own what George Kurtz has built.”

9. Walmart Inc. (NYSE:WMT)

Number of Hedge Fund Holders: 88

Cramer noted Walmart Inc. (NYSE:WMT) stock’s recent gain and explained:

“I even see this with Costco and Walmart, the two best retailers in America… Someone will always find fault with Walmart or say it’s run too much and they’ll sell it down. Week later, another analyst will remind us of the buying opportunity that it is and we’ll jump at the chance. They both hit all-time highs today.”

Walmart (NYSE:WMT) is a well-known retail brand that provides an extensive range of products, including groceries, health goods, electronics, clothing, and private-label items. Cramer has not shied away from expressing his love for the company and in December 2024, he said:

“… I thought that if I had Costco and I had TJ, I shouldn’t have Walmart and the answer is that was wrong. When you think of stock’s going higher, you should break discipline a little and buy the stock. Walmart is amazing and boy, do my kids and I love to shop there. Bargains. Hey, the clothing there by the way, fantastic.”

8. Costco Wholesale Corporation (NASDAQ:COST)

Number of Hedge Fund Holders: 75

According to Cramer, Costco Wholesale Corporation (NASDAQ:COST) stock generally rises after dropping off when investors sell it following its earnings report release.

“I even see this with Costco and Walmart, the two best retailers in America. When Costco reports, people tend to be repelled by the quarter. It could lose a hundred points only to start the trek higher again as there was no reason to sell the stock in the first place… They both hit all-time highs today.”

Costco (NASDAQ:COST) runs a membership-based warehouse system, providing a wide range of branded and private-label items in bulk at discounted prices, attracting shoppers seeking value for larger purchases. The stock has seen gains of more than 45% over the past 12 months.

7. Marriott International, Inc. (NASDAQ:MAR)

Number of Hedge Fund Holders: 60

Cramer noted that investors tend to return to Marriott International, Inc. (NASDAQ:MAR) often after selling as they realize that it is the best in the game.

“Same deal with Marriott, growth hotelier. It heads down after it reports and soars when people realize it is the best hotel chain out there.”

Marriott (NASDAQ:MAR) manages and franchises hotels, residences, timeshares, and yachts globally under a variety of popular brands. Whilst discussing leisure and travel stocks recently, Cramer said:

“Stepping back, I think the travel and leisure stocks remain undervalued because so many analysts keep thinking this story just can’t last… Same reason why Marriott stock keeps climbing.”

6. American Express Company (NYSE:AXP)

Number of Hedge Fund Holders: 62

Discussing American Express Company (NYSE:AXP), Mad Money’s host said:

“I’ve seen this happen endlessly with American Express, AXP, too. It’ll creep up and the fact that the millennials and the gen-whatevers love it, and then it reports on a sleepy Friday, it always reports on Friday, and everyone runs from it like it’s got the bubonic plague. But two weeks later, American Express is up from where it was before the quarter and people have forgotten why they sold it.”

American Express (NYSE:AXP) offers a range of payment solutions, including credit and charge cards, banking services, expense management, travel services, and merchant solutions, alongside fraud prevention and customer loyalty programs. Whilst discussing the company recently, Cramer said:

“Stepping back, I think the travel and leisure stocks remain undervalued because so many analysts keep thinking this story just can’t last. American Express, phenomenal stock, because people can’t think that travel can maintain this incredible pace yet all it does is accelerate.”

5. Abbott Laboratories (NYSE:ABT)

Number of Hedge Fund Holders: 63

Abbott Laboratories (NYSE:ABT) is an international healthcare company dedicated to the discovery, development, production, and sale of a diverse range of healthcare products. Cramer highlighted how the company, despite its lawsuit, has been able to trek upward.

“And we saw this with Abbott Labs, ABT, not that long ago when it lost a lawsuit involving a special infant formula that some agree, parents thought harmed their baby. The formula was made by Abbott because women sometimes just can’t produce enough milk. Abbott only made $9 million a year on it.

I think that they actually own this formula. I think they do it at the behest of the government or just out of, literally out of their hearts, but it doesn’t matter. They lost a $500 million lawsuit, $500 million. And now I told you to dismiss it, not worry about it. Sure enough, what happened? Abbott stock is now up more than 30 points from that event.”

4. Spotify Technology S.A. (NYSE:SPOT)

Number of Hedge Fund Holders: 98

Spotify Technology S.A. (NYSE:SPOT) was mentioned during the episode and here’s what Cramer said:

“Now here’s an easy one, Spotify. It’s this subscription business like Netflix that keeps on growing and growing and growing. It’s the ultimate beat and raise stock, but there’s always someone down there giving them the business. I saw today when an outfit said Spotify’s run too far and it’s peaking. To which I say based on what? I didn’t see a thing in the piece that was convincing. But the stock still got knocked down in the morning. It gave you a great entry point before it rallied and ended the day in positive territory.”

Spotify (NYSE:SPOT) provides subscription-based streaming services, allowing users to enjoy a diverse range of music and podcasts. Cramer recently expressed his love for the company as he stated:

“Now Spotify is a classic beat-and-raise story. It tends to blow away the estimates. I love these subscription businesses, you know that, think Netflix, Amazon because of Prime, and Spotify’s always in the conversation.”

3. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 99

Cramer noticed a pattern where Tesla, Inc. (NASDAQ:TSLA), the leading EV company, gets sold off on some piece of news and then soars when it is praised by “some accolade-loving person”.

“Now we see this pattern constantly. Tesla will sell off over something, I don’t know, maybe it’s German numbers, it’s California numbers, it’s China business. I heard today that people have stopped buying Teslas because Musk turned out to be a Trumpist. I say, so what? He’s gonna solve the self-driving conundrum. Of course, Tesla always has some accolade-loving person who comes on our air and blesses it and says it’s worth a thousand dollars and it’s off to the races again and that will happen. That will happen.”

Cramer has been praising Tesla (NASDAQ:TSLA), not because of its CEO’s position in the political sphere but Elon Musk’s abilities as a CEO. Before the company reported its earnings in January, Cramer remarked:

“Alright, then there’s Tesla. Now I think Elon Musk, get this, I think he could sell tickets to this conference call. He could command a thousand dollars, easy. The last time Tesla reported, missed numbers badly and then it proceeded to have one of the biggest runs ever. Just soared right when it reported that number, and I’ve gotta tell you, I figured it out. Actually, Morgan Stanley’s, Adam Jonas figured it out for me. He calls Tesla, after that quarter, an AI ETF. People want an IETF so they buy the stock no matter what, especially if it’s down the next day. I want you to own Tesla. Just own it.”

Over the past year, Tesla (NASDAQ:TSLA) stock has gained over 100%.

2. Uber Technologies, Inc. (NYSE:UBER)

Number of Hedge Fund Holders: 136

Cramer is confident about Uber Technologies, Inc. (NYSE:UBER) and called it a winner among its delivery peers.

“Same thing with Uber, and you see, you see Uber won the war of pickup and deliver. The numbers reported at this point were extraordinary, but the experts found a line or two they didn’t like. Next thing you know, they kick it to the curb and you get an opportunity to buy some at a discount. I am confident about this one after interviewing CEO Dara Khosrowshahi this very morning on Squawk on the Street… I think this is a good one.”

Uber Technologies, Inc. (NYSE:UBER) designs and operates technology for mobility, delivery, and freight services, connecting users with transportation options, supporting retailer deliveries, and operating a digital logistics platform for shippers and carriers. RGA Investment Advisors stated the following regarding Uber Technologies, Inc. (NYSE:UBER) in its Q4 2024 investor letter:

“During the quarter, we initiated three new investments, each in companies we have followed closely for a considerable time. At various points, we viewed them as missed opportunities; however, our experience with Mr. Market has taught us that patience often creates inevitable entry points. This quarter, some exciting opportunities presented themselves. The three investments are Amazon (NASDAQ: AMZN), Diageo (NYSE:DEO), and Uber Technologies, Inc. (NYSE:UBER). We will discuss each in detail below

At the halfway point of the year, Uber was one of the top-performing stocks in the S&P, and we couldn’t help but kick ourselves for having spent considerable time researching the company—demonstrating gen[1]uine interest—only to never invest a dime. By year-end, however, Uber’s stock had not only surrendered all its gains but had fallen even further. So, what changed? Hype, plain and simple. Specifically, hype surrounding fully autonomous vehicles (AVs).

While we are excited by the advancements toward full autonomy and have friends who rave about their experiences with Waymo, the narrative (there’s that word again!) surrounding the inevitability of AVs has become so pervasive that it’s taken on a life of its own in markets…” (Click here to read the full text)

1. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 76

Starting his list of solid buying opportunities in the stock market these days, Cramer mentioned The Walt Disney Company (NYSE:DIS) and said:

“This morning, for instance, Disney reported. It was a terrific quarter, theme parks, much better than expected, movies, fantastic, TV sports, real positive but there was this one line involving Disney’s streaming property. When it raised prices, there were some churn and subscribers dropped by 1%. Oh no, the genius traders said to themselves, Netflix had no churn when it raised prices, so let’s bury this stock. These wise men and women sold Disney down into oblivion, not thinking about two things.

One, Netflix is a beast, the best of the best without compare. And two, Netflix doesn’t have parks or cruise ships or even a fraction of Disney’s intellectual property. I bet that in a few weeks, people will forget why they sold Disney stock down, and the stock, it will be higher.”

The Walt Disney Company (NYSE:DIS) manages a wide range of businesses, including film and TV production, streaming services, and theme park operations. Cramer has been bullish on the stock for some time and in January, he commented:

“Disney, I turned to Jeff Marks today, it was at $106, I said, when should we buy back that stock that we sold much higher? I think you got a great price today. I think Disney is a remarkable company and people are selling it because of the fires in Los Angeles. I feel horrible about what’s happening in Los Angeles, but I do not think the franchise of Disney is gonna be down for long very much.”

While we acknowledge the potential of The Walt Disney Company (NYSE:DIS) 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 DIS 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 was originally published at Insider Monkey.