We recently published a list of Jim Cramer Sees Opportunity in Pessimism and Highlights These 12 Stocks. In this article, we are going to take a look at where Caterpillar Inc. (NYSE:CAT) stands against other stocks that Jim Cramer discusses.
In his latest appearance on CNBC’s Squawk on the Street, Jim Cramer pushed back against widespread pessimism surrounding the U.S. economy, particularly when it comes to the health of the consumer. Referencing recent data and strong bank earnings, he argued that fears of a sharp slowdown are overstated:
“Consumer spending is up nicely. I mean, for all the things you hear about, the pessimistic surveys, year over year is good. And David, I think that as we forget, as long as unemployment stays as low as it is, we’re going to surprise people in terms of the economy, despite the fact that there’s a lot of stir and drag when it comes to the White House.”
READ ALSO: Jim Cramer’s List of 16 Stocks to Buy Right Now and Jim Cramer Answers If the Market Has Bottomed and Weighs In On 11 Stocks
Asked whether the consumer will remain strong in the face of tariffs and political noise, Cramer stayed optimistic, saying jobs matter more than headlines:
“I think that the agri-consumer, as long as they have jobs, yes. I don’t think they sit there and say, you know what, there’s coming tariff, I’m going to just disappear. Now you can see these numbers are pulled through. I don’t buy that. “
He then shifted to the recent dislocation in equity markets, pointing out that even companies reporting solid earnings have seen analysts cut price targets, saying:
“The reset that happened of stocks getting clogged. We’re just now starting to deal with how awful it was. The market just had, that sell-off was so quick and so vicious that companies that are reporting good numbers, the analysts are saying, listen, really good numbers. I’m cutting my price target. I’m not used to that. I’m used to really good numbers and price target bump. “
Later, citing the latest Bank of America survey showing extreme bearishness, Cramer interpreted the results as a contrarian signal that could point to an opportunity for investors:
“Well, I just think that in the end, the fundamentals are going to will out. I think that this survey about pessimism. I mean, that says buy, not sell. So, I mean, I think people are really beaten down. I know people are beaten down.”
Our Methodology
To make our list of the stocks that Jim Cramer talked about, we listed down the stocks he mentioned during CNBC’s Squawk on the Street aired on April 15th.
For these stocks, we also mentioned the number of hedge fund investors. 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Caterpillar Inc. (NYSE:CAT)
Number of Hedge Fund holders: 62
Caterpillar Inc. (NYSE:CAT) was brought up as the company’s retiring CEO rang the opening bell in celebration of its 100th anniversary. Jim Cramer praised the CEO Jim Umpleby for transforming Caterpillar from a cyclical China-dependent business into a consistent, secular growth story and a net exporter. Here are his thoughts:
“Well, look, this fabulous company that’s ringing the bell today, Caterpillar, net exporter, which is what we want to encourage, right? But would you find, if someone at the end of the day said, we’re going to look into Caterpillar, would that shock you? […]
[Talking about the company’s retiring CEO] The stock’s down 18% this year, which is really, unfortunately, not representative of what he’s done. And I don’t know Joe Creed who’s coming in, but when Jim came in, Caterpillar was regarded as being episodic. And now, not only is it not in their earnings, now it was consistent. He bought back stock. He made it so it was no longer a China play, which was so long the worry. He’s just a great man. And I’m just so thrilled for Jim. Fabulous guy. Really understands, I think, the way to make it so that finally Caterpillar broke out of Episonic. When I first met him, Mike Worth introduced me to him from Chevron, and he said, I’m going to make this company so it’s not cyclical. […] And he did it. He did it. And there’s the long-term chart. And you can see that it just did well in COVID times, did well in downturns, because that’s who he is. He really figured out a way to buy back stock and change the way inventories included. David, look at that. This is an episodic, turned into a secular grower. And we were joking this morning about when Goldman downgraded it to 68 to put it to a selling. This thing never quits. And Jim probably never quits working. And he is a remarkable man in terms of what he’s done with his company. It’s worth pointing it out because, wow. Without a doubt, that is quite a move. That is a non-cyclical chart. And because he turned it into a secular grower, no longer hostage to China. And that’s why I say he’s a net exporter.”
Overall, CAT ranks 8th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of CAT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CAT but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.