Jim Cramer Says Recession Is Not Coming and Recommends These 5 Stocks

1. Costco Wholesale Corporation (NASDAQ:COST)

Number of Hedge Fund Investors: 65

Jim Cramer has long been a fan of Costco Wholesale Corporation (NASDAQ:COST). Recently the analyst said investors should “hold onto the stock for dear life.” A couple of months ago, Cramer praised Costco Wholesale Corporation’s (NASDAQ:COST) quarterly results and said Costco Wholesale Corporation (NASDAQ:COST) posted a “beautiful” quarter but the stock was not up because Costco Wholesale Corporation (NASDAQ:COST) did not announce any special dividends or raise prices. But Costco Wholesale Corporation (NASDAQ:COST) fulfilled investors’ wish earlier this month when it announced a spectacular fiscal Q1 results. Costco Wholesale Corporation (NASDAQ:COST) announced a special cash dividend of $15 per share which will be paid on January 12, 2024.

A total of 65 hedge funds tracked by Insider Monkey had stakes in Costco Wholesale Corporation (NASDAQ:COST).

Cooper Investors made the following comment about Costco Wholesale Corporation (NASDAQ:COST) in its Q3 2023 investor letter:

“With the market rally in the first half of 2023 driving double digit returns we took the opportunity early in the quarter to reassess Value Latency embedded in the portfolio. The spotlight was on more highly valued stocks that represent some of our longest held positions and among the better performers over the years. The outcome is that we have exited several long-term positions at what we consider attractive prices, where the balance of Risk Adjusted Value Latency was no longer in our favour.

We remain admirers of these businesses and they remain on our watchlist, but the reality is their appeal is widely recognised today. Management have executed well on earnings growth, but returns have also come from substantial multiple re-ratings that we see as unlikely to reoccur from today’s higher base.

Costco Wholesale Corporation (NASDAQ:COST) was acquired in March 2015 at ~$150 and has more than tripled over its holding period to ~$550 today, delivering a total return with dividends reinvested of ~330% in USD or IRR of 20%. Over the journey the multiple re-rated from 25 times to ~35 times.”

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