Jim Cramer Nailed These 12 Stock Predictions

8. American Eagle Outfitters, Inc. (NYSE:AEO)

Number of Hedge Fund Holders: 33

Cramer was asked about American Eagle Outfitters, Inc. (NYSE:AEO) in that episode, as the stock had been falling after a period of strong performance. He implied it was too volatile and suggested moving to safer retail names.

“You know what, they have the hot stuff. The problem here, is this: when you get to the hot stuff, you gotta get out. You gotta get in and you gotta get out. That’s too hard for me—too hard for you. Let’s go with more traditional. Let’s go with something like a Walmart or my favorite—and yours, no doubt—Costco. That’s what we’re going to go with. And the kid stays in the picture.”

Cramer’s caution was justified with the stock plunging a staggering 53.96% since.

American Eagle Outfitters, Inc. (NYSE:AEO) is a teen-focused apparel retailer with a significant mall presence, known for its denim and lingerie sub-brand Aerie. Commenting on the stock’s recent negativity, Cramer highlighted the discrepancy between the company’s outlook and the analysts’ outlook, saying:

“There’s this outfit American Eagle Outfitters, AEO, and when you read the comment today, you would, the commentary from the analyst, it’s just a disaster. If you read the actual conference call, almost everything is really great. But you can easily pull lines.”