In this article, we discuss the 10 stocks that Jim Cramer is bearish on.
Jim Cramer, the finance expert who hosts Mad Money on CNBC, has developed a fan following at the market through a career spanning decades that has taken him from Wall Street to the world of primetime television and now into streaming services as well. Cramer is a former Goldman Sachs employee who went on to manage a very successful hedge fund before becoming a full-time journalist. He has an estimated net worth of $150 million and recently launched the subscriber-based Investor Club that gives exclusive market insights to followers.
Cramer has been bullish on companies like Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOG), JPMorgan Chase & Co. (NYSE:JPM), Salesforce.com, Inc. (NYSE:CRM), and NVIDIA Corporation (NASDAQ:NVDA) over the past few months, accurately predicting the rise in their fortunes in the post-pandemic economy. Since his predictions have become legendary, a lot of investors have started to keep track of the stocks that he is bearish on as well. As inflation concerns mount, it might be a good idea to unload some of these from their portfolios.
Our Methodology
These were picked keeping in mind the latest calls that Cramer made on these equities on his Mad Money show aired by news platform CNBC. Analyst ratings and business fundamentals of each company are discussed in detail below to provide readers with some context for their investment decisions.
The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey.
Jim Cramer is Bearish on These Stocks
10. Vaxart, Inc. (NASDAQ:VXRT)
Number of Hedge Fund Holders: 8
Vaxart, Inc. (NASDAQ:VXRT) is a clinical-stage biotech firm that focuses on the development of oral vaccines. Cramer gave the stock a negative mention during the Lightning Round of his show on November 30.
Vaxart, Inc. has been working on an oral vaccine for COVID-19 for the past few months and even though it has shown some progress in this regard, the final product remains elusive.
At the end of the third quarter of 2021, 8 hedge funds in the database of Insider Monkey held stakes worth $17 million in Vaxart, Inc., the same as in the previous quarter worth $6 million.
Just like Apple Inc., Amazon.com, Inc., Alphabet Inc., JPMorgan Chase & Co., Salesforce.com, Inc., and NVIDIA Corporation, Vaxart, Inc. is one of the stocks on the radar of hedge funds as lockdowns loom.
In its Q4 2020 investor letter, Bireme Capital, an asset management firm, highlighted a few stocks and Vaxart, Inc. (NASDAQ:VXRT) was one of them. Here is what the fund said:
“Vaxart (VXRT) was a biotech penny stock until COVID-19 hit, when it released a series of announcements about the progress of its oral tablet coronavirus vaccine. In late June, VXRT claimed to have been selected for the federal government’s Operation Warp Speed vaccine development program despite having only 15 employees. The stock traded more than 60x higher than where it started the year.
This announcement was profitably timed for insiders. In early June, just weeks before the Operation Warp Speed announcement, the CEO was awarded stock options worth $4m, and a hedge fund renegotiated accelerated warrants. By the end of the month, the CEO’s options were worth $28m and the hedge fund had exercised the warrants and sold the shares for a profit of nearly $200m. Oh, and the claim that VXRT was selected for Operation Warp Speed turned out to be false and misleading. The company is currently under investigation for fraud.
VXRT is still exhibiting classic pretender signals. In a vaccine progress roundup from January, Science commented that they could find “no updates at all about its clinical progress — just excited talk about its prospects as an investment.” Numerous press releases talked up its partnerships, like a manufacturing agreement with KindredBio — a tiny company with less than $5m in revenue, self described as “focused on saving and improving the lives of pets.”
Since then, VXRT has released their Phase I trial results. The press release is titled “Positive Preliminary Data,” but near the bottom it revealed that no neutralizing antibodies were found. The stock price tumbled.
There are now a handful of vaccines approved, with several more likely to be approved shortly. And there are dozens more in development, all from larger and more sophisticated companies than VXRT. Each incremental vaccine will find it harder and harder to make it through the grueling approval process as competitors cross the finish line first and coronavirus prevalence declines. Even vaccine developers with highly promising candidates may not be able to recruit tens of thousands of Phase 3 trial participants given the increasing supply of approved and highly effective COVID-19 vaccines.
We find it nearly inconceivable that VXRT will develop a commercially successful coronavirus vaccine, which it desperately needs to justify it’s valuation. VXRT’s Q3 revenues were under $300,000. Nevertheless, it sports a market cap of over $800m, because “vaccines.””
9. ThredUp Inc. (NASDAQ:TDUP)
Number of Hedge Fund Holders: 12
ThredUp Inc. (NASDAQ:TDUP) owns and runs an online resale platform. Cramer gave the stock a Sell rating during the Lightning Round of his show on November 30.
Barclays analyst Ross Sandler has an Overweight rating on ThredUp Inc. stock with a price target of $27. In a recent investor note, the analyst highlighted the elevated cost inflation and concerning guidance numbers of the firm in an otherwise bullish analysis.
Among the hedge funds being tracked by Insider Monkey, California-based investment firm Park West Asset Management is a leading shareholder in ThredUp Inc. with 9 million shares worth more than $199 million.
8. Bionano Genomics, Inc. (NASDAQ:BNGO)
Number of Hedge Fund Holders: 14
Bionano Genomics, Inc. (NASDAQ:BNGO) is a genome analysis company. The journalist investor gave the firm a Sell rating during the Lightning Round of his show on November 29.
Bionano Genomics, Inc. has a market cap of over $1 billion and posted $8.5 million in revenue last year. The short interest on the stock is over 13% and it is one of the most high volume names on the market.
At the end of the third quarter of 2021, 14 hedge funds in the database of Insider Monkey held stakes worth $13 million in Bionano Genomics, Inc., down from 17 the preceding quarter worth $40 million.
7. Lemonade, Inc. (NYSE:LMND)
Number of Hedge Fund Holders: 16
Lemonade, Inc. (NYSE:LMND) is a New York-based insurance company. Cramer mentioned the stock negatively while answering a question on the Lightning Round of his show on November 29.
Lemonade, Inc. stock has slumped in the past few weeks after the firm announced that it would be paying for the acquisition of Metromile, a car insurer, with stock, diluting the stakes of existing shareholders in Lemonade.
At the end of the third quarter of 2021, 16 hedge funds in the database of Insider Monkey held stakes worth $117 million in Lemonade, Inc., up from 15 in the preceding quarter worth $182 million.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Lemonade, Inc. (NYSE:LMND) was one of them. Here is what the fund said:
“We also exited our investment in Lemonade. Lemonade is a digital-first insurance provider, offering both domestic and international homeowners and renters insurance. The company is disrupting its industry, having digitized the entire insurance experience—from client onboarding to claims—in order to build generational relationships with first-time insurance buyers. Using its app, the median time to receive a bindable renters insurance quote from Lemonade is less than two minutes, and the time for a homeowner’s quote is under three minutes. All claims are also filed through the Lemonade app, where a claims-specific bot can pay out applicable claims in as little as three seconds. The company’s longterm strategy is built upon acquiring customers cheaply today as they begin their adult life with the anticipation of growing future premiums as customer demands for insurance products naturally increase as they accumulate typically insured possessions—home and car purchases, travel, pets and providing coverage for beneficiaries in the event of an unforeseen death. We believe the addressable market is massive, particularly given the industry has largely resisted change, giving Lemonade a long runway to take share from weaker legacy competitors. That said, with shares appreciating above our PMV estimate, we exited our campaign.”
6. Oscar Health, Inc. (NYSE:OSCR)
Number of Hedge Fund Holders: 17
Oscar Health, Inc. (NYSE:OSCR) provides health insurance and related services. During the Lightning Round of his show on November 29, the former hedge fund manager gave the stock a Sell rating.
Morgan Stanley analyst Ricky Goldwasser also recently lowered the price target on Oscar Health, Inc. stock to $22 from $26 and kept an Overweight rating, noting that the healthcare disruptor sector was contracting.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Thrive Capital is a leading shareholder in Oscar Health, Inc. with 37 million shares worth more than $654 million.
In addition to Apple Inc., Amazon.com, Inc., Alphabet Inc., JPMorgan Chase & Co., Salesforce.com, Inc., and NVIDIA Corporation, Oscar Health, Inc. is one of the stocks feeling the heat of an economic slowdown.
5. Insmed Incorporated (NASDAQ:INSM)
Number of Hedge Fund Holders: 18
Insmed Incorporated (NASDAQ:INSM) is a biopharma firm that develops therapies for rare diseases. On December 1, while answering a question on the Lightning Round of his show, Cramer gave the stock a negative mention.
Insmed Incorporated missed market estimates on earnings per share and revenue for the third quarter by $0.10 and $2.4 million respectively. The stock has slumped in value by over 31% in the past twelve months.
Among the hedge funds being tracked by Insider Monkey, California-based investment firm Palo Alto Investors is a leading shareholder in Insmed Incorporated with 6 million shares worth more than $165 million.
4. Matterport, Inc. (NASDAQ:MTTR)
Number of Hedge Fund Holders: 22
Matterport, Inc. (NASDAQ:MTTR) is a spatial data company based in California. The stock was given a Sell rating by the journalist investor on November 29 during the Lightning Round of Mad Money on CNBC.
Matterport, Inc. posted earnings for the third quarter on November 3, reporting earnings per share of -$0.06, beating estimates by $0.01. The revenue over the period was $27 million, missing estimates by $1.4 million.
At the end of the third quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $371 million in Matterport, Inc..
In its Q3 2021 investor letter, Miller Value Partners, an asset management firm, highlighted a few stocks and Matterport, Inc. (NASDAQ:MTTR) was one of them. Here is what the fund said:
“Matterport Inc. (MTTR) took off during the quarter climbing 78.90% following the company’s de-SPAC in July. The company announced they have expanded ‘Matterport Capture Services’, their on demand digitization service, to 22 new US cities and added four in the United Kingdom. This will allow customers to schedule a technician to digitize any commercial or residential property and is now available in 51 US cities in total. The company also announced a beta version of its Notes collaboration tool, a conversational, real-time team collaboration, communication and file sharing tool inside the Matterport digital twin.”
3. Allbirds, Inc. (NASDAQ:BIRD)
Number of Hedge Fund Holders: N/A
Allbirds, Inc. (NASDAQ:BIRD) markets footwear and apparel products. Cramer gave the stock a Sell rating during the Featured Stock segment of his show December 2.
Allbirds, Inc. has been losing money since the IPO and also has negative cash flows from operations. The firm recently also missed market estimates on earnings per share for the third quarter by $0.14.
Morgan Stanley analyst Kimberly Greenberger has an Equal Weight rating on Allbirds, Inc. stock with a price target of $23.
2. Carnival Corporation & plc (NYSE:CCL)
Number of Hedge Fund Holders: 36
Carnival Corporation & plc (NYSE:CCL) is a leisure travel company based in Florida. The former hedge fund manager gave the stock a Sell rating during the Lightning Round of his show on November 29.
The rise of a new variant of COVID-19 has hit travel stocks like Carnival Corporation & plc (NYSE:CCL) in the past few weeks. The share price of Carnival Corporation has fallen close to 10% in the last five days.
At the end of the third quarter of 2021, 36 hedge funds in the database of Insider Monkey held stakes worth $520 million in Carnival Corporation & plc (NYSE:CCL), up from 31 in the previous quarter worth $456 million.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Carnival Corporation & plc (NYSE:CCL) was one of them. Here is what the fund said:
“Several of our better performers in the first quarter were purchased while their business models were under stress from COVID restrictions or the macro environment the pandemic created. What gave us confidence in purchasing Carnival was the actions the company took to extend out their balance sheets until travel resumed. Both should benefit as a broader vaccination rollout prompts cruise lines to resume operations and consumers to start traveling again and are positioned to deliver better margins and gain pricing power as the economy normalizes due to the cost controls implemented during the downturn.”
1. Robinhood Markets, Inc. (NASDAQ:HOOD)
Number of Hedge Fund Holders: 20
Robinhood Markets, Inc. (NASDAQ:HOOD) is a California-based financial services platform. The shares have slumped by more than 8% in the past few days as the stock lockup period after the IPO expired. Cramer gave the stock a Sell rating during the Lightning round of his show on December 2.
Deutsche Bank analyst Brian Bedel recently opened up a Sell Catalyst Call on Robinhood Markets, Inc. stock, terming it a short-term investment idea. The analyst has a Hold rating on the stock with a price target of $32 and said in a recent investor note that the shares may continue to dive in the near-term as a security breach drives away customers.
At the end of the third quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $4.6 billion in Robinhood Markets, Inc..
You can also take a peek at 10 High-Yield Dividend Stocks with Payout Ratio Less than 55% and 10 Stocks to Buy Today According to British Billionaire David Harding.
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This article is originally published at Insider Monkey.
