In this article, we discuss the 10 stocks that Jim Cramer is monitoring for market recovery.
The stock market had rallied in the past few weeks on the back of encouraging inflation data from July, boosting the optimism around a soft landing for the United States economy. Jim Cramer, the former hedge fund manager and present host of Mad Money on CNBC, recently identified some of the reasons why investors should be wary of a quick market recovery. He reiterated his warning against investments in unprofitable firms and even acknowledged that some businesses with strong balance sheets were also feeling the heat.
Some of the stocks that Jim Cramer is monitoring in the developing macro environment include Uber Technologies, Inc. (NYSE:UBER), Adobe Inc. (NASDAQ:ADBE), and Citigroup Inc. (NYSE:C). The journalist investor claims that a strong US dollar and an energy crisis in Europe due to the Ukraine war was making companies more frugal with their purchases. Cramer also warned investors in the US that the central bank needed inflation to come down and as more aggressive rate hikes beckoned, “things could get uglier”.
Cramer noted that the Federal Reserve might be “doing better in its inflation effort than expected” but might still hike rates with another 75 basis points in the coming weeks. Cramer said that it was “time to take a more measured approach in order to assess how things are going” in light of the developing situation. Cramer and his stock-picking techniques have accumulated an ardent fan base over the past few years. Before his journalism career took off, Cramer was a successful hedge fund manager.
Our Methodology
These were picked keeping in mind the latest calls that Cramer made on these equities during his appearances on news platform CNBC. An extensive database of around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the popularity of each stock among hedge funds.
Jim Cramer Is Monitoring These Stocks Stocks for Market Recovery
10. Starbucks Corporation (NASDAQ:SBUX)
Number of Hedge Fund Holders: 55
Starbucks Corporation (NASDAQ:SBUX) operates as a roaster, marketer, and retailer of specialty coffee worldwide. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company had posted encouraging revenue growth and margin expansion numbers recently. He also added that the firm had invested extensively in technology to modernize its operations in recent months.
On September 16, Piper Sandler analyst Nicole Miller Regan maintained a Neutral rating on Starbucks Corporation stock and raised the price target to $92 from $84, noting that the enterprise was committing to a cultural-reboot in the field.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Starbucks Corporation, with 5.8 million shares worth more than $444 million.
Just like Uber Technologies, Inc., Adobe Inc., and Citigroup Inc., Starbucks Corporation is one of the stocks that Jim Cramer is talking about.
In its Q2 2022 investor letter, Matrix Asset Advisors, an asset management firm, highlighted a few stocks and Starbucks Corporation was one of them. Here is what the fund said:
“Starbucks Corporation is a premiere global coffee brand supported by over 32,600 stores across the world. The firm has a long history of beverage innovation and strong employee/barista relations with the firm paying above-market wages and benefits. Starbucks has a strong balance sheet and finances. The company generates steady and consistent cash flow, selling millions of cups of premium coffee every day. The company’s share price declined in part due to its large business in China which was largely shut down due to Covid restrictions and because of rising commodity and labor costs. We think the shares are attractively priced for a company that should grow 10% plus per year with a dividend yield of 2.6% at our average cost.”
9. Marvell Technology, Inc. (NASDAQ:MRVL)
Number of Hedge Fund Holders: 63
Marvell Technology, Inc. (NASDAQ:MRVL) designs, develops, and sells analog, mixed-signal, digital signal processing, and embedded and standalone integrated circuits. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company could gain from gaming and PC-related growth catalysts but should be wary of the diversification theme emerging in the semiconductor space.
On September 13, Exane BNP Paribas analyst Karl Ackerman initiated coverage of Marvell Technology, Inc. stock with an Outperform rating and a price target of $62, identifying the firm as one of the top picks in the chip space.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Marshall Wace LLP is a leading shareholder in Marvell Technology, Inc., with 4.9 million shares worth more than $214 billion.
In its Q2 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Marvell Technology, Inc. was one of them. Here is what the fund said:
“Marvell Technology, Inc. provides infrastructure semiconductor solutions. Investors have recently become concerned about the semiconductor cycle and how demand for Marvell’s products will fare in a slowing economic environment. We remain confident that the company’s portfolio of products is extremely important in parts of the datacenter server market, which remains healthy and possesses long-term secular trends. The company also has secured strong contract wins in upcoming global 5G wireless infrastructure build-outs, which are generally insulated from macroeconomic pressures. With supply chain issues easing, we believe Marvell remains in a strong position to post continued robust growth.”
8. Costco Wholesale Corporation (NASDAQ:COST)
Number of Hedge Fund Holders: 64
Costco Wholesale Corporation (NASDAQ:COST) operates a network of membership warehouses. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was building everywhere, including big projects in China, and did not want to raise the membership fees because it was part of a larger plan by the retail giant to pressure the competition.
On September 12, UBS analyst Michael Lasser maintained a Buy rating on Costco Wholesale Corporation stock with a price target of $595, noting the firm was expected to post a healthy upside for the fourth quarter of 2022.
Among the hedge funds being tracked by Insider Monkey, Washington-based Fisher Asset Management is a leading shareholder in Costco Wholesale Corporation, with 4.3 million shares worth more than $2.1 billion.
In its Q2 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Costco Wholesale Corporation was one of them. Here is what the fund said:
“Portfolio gains were led by a diverse group of contributors. Also in consumer discretionary, Costco Wholesale Corporation, which operates a chain of membership-only big-box retail stores, continues to impress as it takes to share and becomes more relevant for the consumer even as the world opens up.”
7. Humana Inc. (NYSE:HUM)
Number of Hedge Fund Holders: 69
Humana Inc. (NYSE: HUM) operates as a health and wellbeing company in the United States. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was making cost-cutting measures that were going to be “exciting a year from now, and not right now”. Cramer said he was bullish on the long-term prospects for the shares.
On September 16, Truist analyst David MacDonald maintained a Hold rating on Humana Inc. stock and raised the price target to $570 from $550, appreciating the raised guidance numbers that the company posted recently.
At the end of the second quarter of 2022, 69 hedge funds in the database of Insider Monkey held stakes worth $3.7 billion in Humana Inc., compared to 66 in the preceding quarter worth $3.1 billion.
In its Q2 2022 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and Humana Inc. was one of them. Here is what the fund said:
“During the quarter, we also sold our position in Humana in favor of names that, in our opinion, offer more potential upside. Geographically, we ended the quarter with 53% of the portfolio in the U.S., 38% in the U.K. and Europe, and 9% in Asia.”
6. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Johnson & Johnson develops, manufactures, and sells various products in the healthcare field. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was not one that investors should fear since it was a “good one”, pointing out that the profits and pricing power of the firm in a recessionary environment would make it stand out among peers.
On July 21, UBS analyst Kevin Caliendo maintained a Neutral rating on Johnson & Johnson stock and lowered the price target to $180 from $185, noting that the second quarter earnings of the firm confirmed the macro undercurrents.
Among the hedge funds being tracked by Insider Monkey, Fort Lauderdale, Florida-based firm GQG Partners is a leading shareholder in Johnson & Johnson, with 6.6 million shares worth more than $1.2 billion.
Along with Uber Technologies, Inc., Adobe Inc., and Citigroup Inc., Johnson & Johnson is one of the stocks that Jim Cramer is talking about.
In its Q2 2022 investor letter, Mayar Capital, an asset management firm, highlighted a few stocks and Johnson & Johnson was one of them. Here is what the fund said:
“Johnson & Johnson is currently our largest position and a long-standing holding. The majority of the group’s sales comes from its collection of pharmaceutical franchises, but a large majority (~45%) comes from its collection of medical device businesses and its consumer brands. Here’s how JNJ make and spend a dollar of revenues: As of 2021, about 55 cents of that dollar comes from its pharmaceutical sales – sales of drugs to pharmacies and distributors – while 30 cents come from the sale of medical devices, such as surgery equipment and orthopaedics. The rest of that dollar in sales comes from sales of JNJ’s consumer brands such as Listerine mouthwash, Nicorette nicotine tablets and Neutrogena cosmetics (…read more)
5. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 128
Apple Inc. (NASDAQ:AAPL) designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories. Cramer discussed the stock during an appearance on CNBC on September 14, placing the company among a basket of big tech stocks that he was bullish on despite the slowing macro environment at the stock market.
On September 14, Bernstein analyst Toni Sacconaghi maintained a Market Perform rating on Apple Inc. stock with a price target of $170, noting that iPhones remained a key driver of growth for the company.
At the end of the second quarter of 2022, 128 hedge funds in the database of Insider Monkey held stakes worth $143 million in Apple Inc., compared to 131 in the previous quarter worth $182 million.
In its Q2 2022 investor letter, Alger Capital, an asset management firm, highlighted a few stocks and Apple Inc. was one of them. Here is what the fund said:
“Apple Inc. (NASDAQ:AAPL) is a leading technology provider in telecommunications. computing and services. Apple’s iOS operating system is the company’s unique intellectual property and competitive strength. This software drives extremely tight engagement with consumers and enterprises. The engagement is fostering the growing purchase of high-margin services like music, apps, and apple pay. Apple’s shares detracted from performance as management lowered its guidance for the second quarter due to headwinds from the war in Ukraine, adverse foreign currency shifts, and dampened consumer demand associated with the coronavirus in China. Additionally, many investors were concerned that lockdowns implemented to curtail the spread of COVID-19 would impact production of apple products, however the manufacturing facilities have resumed activity.”
4. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 153
Alphabet Inc. (NASDAQ:GOOG) provides various technology products and platforms. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was one of the few on the market that seemed to have “very little bottom”.
On August 3, Tigress Financial analyst Ivan Feinseth maintained a Strong Buy rating on Alphabet Inc. stock and raised the price target to $186 from $183, noting the resilience of the core cloud and search business of the firm despite misses on earnings.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel investment Group is a leading shareholder in Alphabet Inc., with 3.1 million shares worth more than $6.9 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Alphabet Inc. was one of them. Here is what the fund said:
“Alphabet Inc. is the parent company of Google, the world’s largest search and online advertising company. Shares of Alphabet declined 21.6% in the quarter due to concerns about slower global growth impacting the company’s core advertising business. We retain conviction in Alphabet’s merits as it continues to benefit from growth in mobile and online video advertising, which accrues to its core assets of search, YouTube, and the Google ad network. We are further encouraged by Alphabet’s investments in Cloud, AI, and Autonomous Driving (through its Waymo subsidiary).”
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 184
Meta Platforms Inc. (NASDAQ:META) develops products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, wearables, and in-home devices worldwide. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was one of the many on the market that seemed to have “no bottom”. However, he said that he would “buy the stock”.
On September 13, Morgan Stanley analyst Brian Nowak maintained an Overweight rating on Meta Platforms, Inc. stock with a price target of $225, noting that the total time users spent on Meta Platforms was decreasing.
At the end of the second quarter of 2022, 184 hedge funds in the database of Insider Monkey held stakes worth $18.2 billion in Meta Platforms, Inc., compared to 200 the preceding quarter worth $19.3 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Meta Platforms, Inc. was one of them. Here is what the fund said:
“Shares of Meta Platforms, Inc., the owner of Facebook, the world’s largest social network, fell 28.4% during the second quarter due to quarterly results that missed consensus estimates, driven by the impact of Apple’s new privacy changes in its iOS operating system. These changes have made it harder for Facebook to measure the effectiveness of its advertising across its mobile apps.
In the longer term, we expect Facebook to continue utilizing its leadership in mobile to provide global advertisers targeted marketing capabilities at scale, with substantial monetization optionality ahead in newer areas such as Reels (Meta’s competing solution to TikTok) and e-commerce.”
2. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 252
Amazon.com, Inc. (NASDAQ:AMZN) engages in the retail sale of consumer products and subscriptions in North America and internationally. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was one of the stocks that his investing club had recommended buying, even in the present macroeconomic environment.
On September 12, DA Davidson analyst Tom Forte maintained a Buy rating on Amazon.com, Inc. stock with a price target of $151, noting the firm was making a concerted effort to enter the robotics sector.
At the end of the second quarter of 2022, 252 hedge funds in the database of Insider Monkey held stakes worth $30 billion in Amazon.com, Inc., compared to 271 the preceding quarter worth $48 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Amazon.com, Inc. was one of them. Here is what the fund said:
“Amazon.com, Inc. (NASDAQ:AMZN) is the world’s largest retailer and cloud services provider. Shares of Amazon declined 35% in the quarter due to weaker-than-expected profits resulting from an overcapacity of resources coming out of COVID. We expect Amazon to grow into its retail capacity in the quarters to come, which would enable it to improve profitability accordingly. Amazon remains one of our largest holdings due to its durable competitive advantages with a leading position in multiple trillion-dollar markets with a long runway for growth (…read more)
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 258
Microsoft Corporation (NASDAQ:MSFT) develops, licenses, and supports software, services, devices, and solutions worldwide. Cramer discussed the stock during an appearance on CNBC on September 14, noting that the company was “the richest of them all” in an apparent reference to the position of the firm among other tech giants.
On July 27, Wedbush analyst Daniel Ives maintained an Outperform rating on Microsoft Corporation stock and lowered the price target to $320 from $340, noting that the metrics around cloud and commercial bookings looked strong for the firm.
At the end of the second quarter of 2022, 258 hedge funds in the database of Insider Monkey held stakes worth $56 billion in Microsoft Corporation, compared to 259 in the previous quarter worth $66 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Microsoft Corporation was one of them. Here is what the fund said:
“Shares of Microsoft Corporation, a leading global provider of software solutions, declined 16.6% in the quarter along with the broader software group as well as due to growing concerns of a potential macro-driven slowdown. This is despite the company posting strong quarterly financial results and successfully absorbing headwinds from the war in Ukraine. The company had 21% revenue growth, 23% operating income growth, and 35% growth in Microsoft Cloud (all year-over-year in constant currency), which now represents 47% of total revenues. (read more…)
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This article is originally published at Insider Monkey.
