Jim Cramer is Recommending These 5 Stocks

1. Alibaba Group Holding Ltd – ADR (NYSE:BABA)

Number of Hedge Fund Investors: 116

Jim Cramer said in a latest program on CNBC that Alibaba Group Holding Ltd – ADR (NYSE:BABA) is the “cheapest stock in the world.” Cramer highlighted David Tepper’s (of Appaloosa Management)  huge stake (worth $814 million) in Alibaba Group Holding Ltd – ADR (NYSE:BABA) and said:

“I was talking to my buddy Dave Tepper, he’s got a huge position in Alibaba. He’s one of my thousand bosses I had at Goldman. And we both admit.. I mean this is one of the cheapest stocks.. it’s the cheapest stock in the world.”

Cramer said that if you can “stomach” owning a Chinese stock, you should buy Alibaba Group Holding Ltd – ADR (NYSE:BABA) and then buy more if it goes down.

Artisan Select Equity Fund stated the following regarding Alibaba Group Holding Limited (NYSE:BABA) in its fourth quarter 2023 investor letter:

“Pretty much all of our holdings rose during the quarter. Only one stock declined by more than a couple of percent—Alibaba Group Holding Limited (NYSE:BABA), which was down 9% for the quarter and 12% for the year. This investment continues to be a disappointment. We estimate the shares are trading at around 5X EBITA—a valuation normally reserved for a company with evaporating profits. While it’s true Alibaba is underperforming its peers in the market, the fact is it remains the market leader in its core businesses, and the business is still growing. In the most recent quarter, revenues grew 9% and profits grew 26%.It’s not evaporating.

The management seems to be making meaningful changes designed to enhance shareholder value, including structural changes to improve profitability and restore its competitive position. It is monetizing non-core assets and making improvements in capital allocation. A lot of good things are happening that are not yet recognized in the share price. There are reasons—primarily geopolitical—for this, but at the current valuation, we could easily see the shares double and they would still be cheap.”

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