We recently compiled a list of the Jim Cramer’s Best Performers List: Top 10 Stocks. In this article, we are going to take a look at where AST SpaceMobile, Inc. (NASDAQ:ASTS) stands against the other stocks on Jim Cramer’s list of best performers list.
On Wednesday’s Mad Money episode, Jim Cramer took a deep dive into ten stocks, each worth over $1 billion, that have seen significant growth this year. While acknowledging that many of these stocks are speculative, he emphasized that they still hold potential as smart investments.
Cramer suggested that when looking back on this year, two trends will stand out: a steady rise in the S&P 500, and a series of moves that initially seemed almost magical, but were grounded in reality.
Cramer also reflected on the common investment approach of sticking with index funds, noting that it is a popular strategy because it requires minimal effort. But, according to him, simply parking your money in an index fund might not be the best way to maximize returns. Instead, he argued that investors should consider individual stocks with unique characteristics, many of which are speculative since they offer opportunities for much larger gains.
Cramer criticized the tendency among experts to dismiss individual stock investments beyond index funds, saying:
“Far too often we become snobs when we talk stocks. So many experts think that if you venture past the index, you could fall off some sort of intellectual cliff. It makes any gains null and void. It’s as if the huge swath of points you could have gained simply don’t count. But that, people, is nonsense.”
READ ALSO Jim Cramer on Microsoft and Other Stocks and 10 Stocks on Jim Cramer’s Radar
During Wednesday’s episode, Cramer highlighted several stocks that have surged by over 200% this year, choosing to focus only on those with a market cap of more than $1 billion. He did clarify, however, that he was not endorsing these stocks, especially given how much they have already appreciated. Instead, his point was that speculative stocks, despite their volatility, have a valid place in an investment portfolio.
While they come with risks, a small stake in one of these stocks could outperform a much larger investment in an index fund. For Cramer, it is not about avoiding speculative stocks altogether, but recognizing their potential when balanced alongside more stable investments like index funds.
Cramer wrapped up by stressing the importance of considering these high-flying, speculative stocks and said:
“The bottom line: Let’s remember this list of frothy stocks and think of them the next time you’re about to ignore a stock for being too speculative because these names are often the epitome of speculating wisely, which can be the key for terrific long-term performance, of course, only when melded with index funds.”
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the episode of Mad Money on November 13 and listed the stocks in the order that Cramer mentioned them.
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).
An aerial view of a communications satellite in orbit, beaming its signal down to Earth.
AST SpaceMobile, Inc. (NASDAQ:ASTS)
Cramer acknowledged that AST SpaceMobile, Inc. (NASDAQ:ASTS) has been burning money but pointed out that space stocks are in favor presently.
“Alright, seventh: AST SpaceMobile is another company that I’ve gotten a lot of calls about lately. It’s a satellite maker but it has deals with Verizon, AT&T. It helps smartphone connectivity. While it’s losing gobs and gobs of money, it’s a space stock, and space is loved right now, hence why AST’s up over 362% this year.”
AST SpaceMobile (NASDAQ:ASTS), a company focused on creating a space-based cellular broadband network for smartphones, is actively working on expanding its operations and technology to provide global mobile connectivity, especially in areas lacking terrestrial coverage. On November 14, the company released its third-quarter earnings report, revealing progress across several fronts, including new contracts and government partnerships.
During the third quarter, the company notably expanded its customer base and ecosystem, securing three new contract awards with the U.S. Government. These agreements allow the company to build on its existing in-orbit technology and strengthen its offerings for both commercial and government applications. It was also selected by the Space Development Agency (SDA) to compete directly as a prime contractor under the Hybrid Application for Proliferated Low Earth Orbit (HALO) program.
In addition to government contracts, AST SpaceMobile (NASDAQ:ASTS) continued its ongoing discussions with commercial partners. The company has established a growing list of global commercial partnerships, which include major players like AT&T, Verizon, Google, and Vodafone.
These collaborations give the company access to a vast network of more than 45 mobile operators, which collectively serve over 2.8 billion subscribers worldwide. The company also highlighted its financial position at the end of the quarter, reporting a balance sheet with $518.9 million in cash, cash equivalents, and restricted cash.
Overall ASTS ranks 7th on Jim Cramer’s list of the best performing stocks. While we acknowledge the potential of ASTS 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 timeframe. If you are looking for an AI stock that is more promising than ASTS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article is originally published at Insider Monkey.
Hedge Fund Resource Center