We recently compiled a list of the 10 Best Jim Cramer Stocks to Buy According to Analysts. In this article, we are going to take a look at where EQT Corporation (NYSE:EQT) stands against the other Jim Cramer stocks.
Jim Cramer, the host of Mad Money, recently discussed the rise of Bitcoin and expressed his admiration for the digital currency’s growth. However, he was careful to emphasize that Bitcoin should not replace traditional investments, particularly stocks, but rather should complement them in a diversified portfolio.
“I want to discuss Bitcoin, really I do, not to the detriment of stocks but in addition to stocks. I come to praise Bitcoin, not bury it.”
Cramer recalled the moment when President-elect Donald Trump began giving importance to cryptocurrency during his administration. On July 27, Trump declared that the U.S. government would fully embrace Bitcoin if he won the election. At the time, Bitcoin was valued just under $70,000. Cramer also noted Trump’s promise to create a strategic Bitcoin reserve and make America the global leader in cryptocurrency.
Cramer highlighted Trump’s statement, “If crypto is going to define the future, I want it to be mined, minted, and made in the USA.” Regardless of whether one agrees with the policy, Cramer remarked, Trump’s words were a clear signal of how beneficial the growing popularity of cryptocurrency could be for its owners.
READ ALSO Jim Cramer’s Lightning Rounds: 12 Stocks Under the Spotlight and Jim Cramer’s Game Plan This Week: 10 Stocks to Watch
Cramer then shared insights from Federal Reserve Chairman Jerome Powell, who suggested that many investors see Bitcoin as a store of value, similar to gold. He went on to say:
“I’ve always endorsed keeping up to 10% of your portfolio in gold as a kind of insurance against the world’s lunacy. But for years now, I’ve also been saying Bitcoin’s a fine alternative to gold for that 10% position. Why not? I think the federal budget deficit is at impossible levels. I don’t want to be wedded to a currency backed by the full faith and credit of a country that owes $36 trillion.”
Cramer also acknowledged that some people might have gone all-in on Bitcoin and praised their decision. However, he recommended balancing Bitcoin investments with stocks. For instance, if Trump were to make a move to encourage buying Tesla, Cramer commented, having both stocks and crypto would give investors an edge.
“While we could become the bitcoin network, especially since President-elect Trump christened us as the bitcoin nation, I actually think there’s more to investing than just owning cryptocurrencies… Bitcoin’s part of the most obviously diversified portfolio in recent history. Buying and holding stocks can be just as lucrative as buying Bitcoin six days after Biden dropped out of the race. Or maybe, just maybe, it can make you even more money.”
Our Methodology
For this article, we compiled a list of 29 stocks that Cramer was bullish on during episodes of Mad Money aired over the last 2 weeks. We narrowed the list to 10 stocks that were most favored by analysts. We listed the stocks in ascending order of their average analyst price target upside as of December 9. The average price target upside was calculated while the market was open. We also mentioned the hedge fund sentiment around each stock, which was taken from Insider Monkey’s Q3 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 storage facility for natural gas, showing the vast reserves of this abundant energy source.
EQT Corporation (NYSE:EQT)
Average Price Target Upside: 9.61%
Number of Hedge Fund Holders: 48
Commenting on natural gas stocks possibly thriving under the new administration, Cramer said that EQT Corporation (NYSE:EQT) is a buy.
“First, you could own some producers. Now I happen to like a company called EQT, which is exclusively focused on natural gas operations in the Appalachian Basin across Pennsylvania, West Virginia, Ohio. After spending a couple years trading sideways, EQT has caught fire since the election, climbing 22% to its highest level since late 2022. Well, even before the election, this stock was getting some buzz. Bank of America reinstituted coverage with a buy rating in late October. Then the next day, EQT reported a terrific beat and raise quarter, which did shock me.
Earlier this year, EQT made a pipeline acquisition buying Equitrans, all stock deal valued the combined company [at] more than $35 billion, that closed in July. In the latest conference call, EQT CEO, Toby Rice, a real smart fellow… about the merger [said]… I’m gonna quote, ‘Transform EQT into America’s only large scale, vertically integrated natural gas business’, and true, before noting that the integration is well underway and saying that all sorts of efficiencies are being unlocked along the way. If the natural gas rally truly has legs, then I gotta tell you: EQT (is a buy).”
EQT (NYSE:EQT), a leading U.S. natural gas production company, merged with Equitrans Midstream Corporation in March to form a vertically integrated natural gas business valued at over $35 billion. By the third quarter, it had completed more than 60% of integration tasks and realized over 50% of the expected synergies from the acquisition within just three months. You can read about the company’s third-quarter results that we discussed in our article, Jim Cramer’s List of 7 Energy Stocks for the Trump Trade.
In late November, the company announced a deal with Blackstone Credit & Insurance (BXCI) to form a new midstream joint venture (JV) that includes EQT’s high-quality contracted infrastructure assets such as the Mountain Valley Pipeline, FERC-regulated transmission and storage assets, and the Hammerhead Pipeline. BXCI will invest $3.5 billion for a non-controlling equity stake in the JV, which values the venture at approximately $8.8 billion, or 12x EBITDA.
The transaction gives EQT (NYSE:EQT) access to significant equity capital while retaining rights to future growth projects, including the Mountain Valley Pipeline expansion. The company plans to use the proceeds to reduce its debt and redeem senior notes, expecting to exit 2024 with around $9 billion in net debt.
EQT’s CEO, Toby Z. Rice, noted that the JV allows the company to maintain the benefits of its Equitrans acquisition, while CFO Jeremy Knop highlighted that EQT has exceeded the high-end of its $3-$5 billion asset sale target, securing $5.25 billion in projected cash proceeds ahead of schedule.
Overall EQT ranks 8th on our list of the best Jim Cramer stocks according to analysts. While we acknowledge the potential of EQT 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 EQT 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.
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