We recently published an article titled Jim Cramer Looked Closely At These 10 Stocks. In this article, we are going to take a look at where ASML Holding N.V. (NASDAQ:ASML) stands against the other stocks Jim Cramer looked closely at.
Jim Cramer, the host of Mad Money, recently discussed the impact of President Donald Trump’s first few weeks in office on the financial markets. Cramer pointed out that while some investors had expected severe tariffs under Trump’s administration, many have begun to believe that these expectations may be exaggerated.
According to Cramer, Wall Street initially became excited about a potentially more flexible approach under Trump. Investors were concerned that Trump might take a hard stance against Mexico and Canada, but as the situation developed, it became clear that his actions would not be as extreme as initially feared. He added:
“Before taking the White House, he talked about putting 25% tariffs on our two longstanding trading partners immediately but then when the America First Trade policy memo came out, we saw that the administration wants to study the situation.”
READ ALSO Jim Cramer’s Thoughts on These 7 Stocks and Jim Cramer Looked At These 7 Stocks Recently
Cramer remarked that although Trump had made bold statements about renaming the Gulf of Mexico to the “Gulf of America,” his actual policies have been more tempered. Cramer noted that if Trump can find someone in Canada willing to negotiate, he would pursue that, and he’s already receiving business-like responses from Mexico’s president, Claudia Sheinbaum. He added:
“Again, the rhetoric was hot, but the reality was cool. Sure there are some real harsh words for a lot of the environmental rules and regulations and grants that President Biden jammed through the last four years. Trump has no time for these.”
In addition to trade policies, Cramer also commented on Trump’s stance regarding environmental regulations. Trump has made it clear that he has no patience for many of the environmental rules and grants implemented during the previous administration. Cramer pointed out that Trump views oil and gas as essential to America’s economic strength, believing that increased drilling and production would lead to lower oil prices and enhance U.S. power abroad.
However, Cramer acknowledged that it’s unclear how much influence Trump can exert over the oil and gas industry. He emphasized the need for more infrastructure, particularly pipelines, to facilitate both domestic and international distribution of natural gas. While oil executives are aware of the political pressure to increase production, they also know that any loss of discipline in response to presidential demands could lead to plummeting prices and financial losses.
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on January 21. We listed the stocks in ascending order of their hedge fund sentiment as of the third quarter, which was taken from Insider Monkey’s database of 900 hedge funds.
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).
A technician in a clean room working on a semiconductor device, illuminated by the machines.
ASML Holding N.V. (NASDAQ:ASML)
Number of Hedge Fund Holders: 64
Cramer called ASML Holding N.V. (NASDAQ:ASML) “remarkable” and suggested to invest in the stock. He said, “I think ASML is a remarkably great company and I think you should buy it. Let me tell you, I also like Lam Research.”
ASML (NASDAQ:ASML) designs and manufactures advanced semiconductor equipment, including lithography, metrology, and inspection systems, offering solutions for chipmakers to produce a wide range of semiconductor technologies and providing customer support and system upgrades. In October 2024, Cramer mentioned the company and explained:
“Very important technology, which is why ASML when it gave a horrendous forecast yesterday, something it did actually by mistake, they weren’t supposed to, they got the date wrong for the release. Lots of investors figured that it must be game over for the semiconductor stocks themselves… It was natural to assume that such a huge shortfall must be the result of the weakness across the board from all of its clients… ASML’s relatively unknown… That just made it even more mysterious and thus inscrutable terrifying… Doesn’t matter that ASML said they’re still getting tons of orders from companies that make AI-related chips. It was the one bright spot they had. No one believed anything was any good here because the guidance was so horrible.”
Ithaka Group stated the following regarding ASML Holding N.V. (NASDAQ:ASML) in its Q4 2024 investor letter:
“ASML Holding N.V. (NASDAQ:ASML) is a leading supplier of photolithography equipment used in semiconductor manufacturing, enabling the production of microchips at ever-smaller line widths. The company’s cutting-edge technologies, particularly extreme ultraviolet (EUV) lithography, play a critical role in producing the most advanced chips for applications like smartphones, data centers, and AI. ASML’s systems are vital for the semiconductor industry, helping to push the boundaries of Moore’s Law and drive innovation in electronics. Weakness in ASML’s stock was due to their 3Q24 earnings announcement, in which the company posted a weak quarter while also cutting forward guidance. Fears surrounding lithography demand, the China/US trade war, and problems at the major fab plants sent the stock tumbling.”
Overall ASML ranks 4th on our list of the stocks Jim Cramer recently looked at. While we acknowledge the potential of ASML 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 ASML but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article was originally published at Insider Monkey.