In this article, we discuss the 5 stocks that Jim Cramer says you should buy. If you want to read about some more stocks that Jim Cramer says you should buy, go directly to Jim Cramer Says You Should Buy These 10 Stocks.
5. Five9, Inc. (NASDAQ:FIVN)
Number of Hedge Fund Holders: 56
Five9, Inc. (NASDAQ:FIVN) provides cloud software solutions. Jim Cramer gave the stock a Buy recommendation during the Guest Interview segment of his show on May 2. During the segment, Cramer discussed the potential of the stock in the artificial intelligence and virtual assistant space as traditional telephones became outdated and were replaced by modern virtual assistants. Five9 has already partnered with big tech players like Microsoft and Google in this regard to differentiate their products from the competition.
On April 29, Piper Sandler analyst James Fish kept an Overweight rating on Five9, Inc. (NASDAQ:FIVN) stock and raised the price target to $169 from $163, noting the firm was a “franchise name to own with results providing further evidence of this”.
At the end of the fourth quarter of 2021, 56 hedge funds in the database of Insider Monkey held stakes worth $2.5 billion in Five9, Inc. (NASDAQ:FIVN), compared to 76 in the preceding quarter worth $3.5 billion.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Five9, Inc. (NASDAQ:FIVN) was one of them. Here is what the fund said:
“Five9, Inc. (NASDAQ:FIVN) is a cloud-based contact center as a service software provider that is replacing aging on-premise legacy solutions that dominate the installed base. Companies are being forced to modernize and cloud penetration is still low; Five9, Inc. (NASDAQ:FIVN) is positioned to benefit and should see further growth driven by its cross-selling add-on modules and an AI product that generates high revenue.”
4. American Express Company (NYSE:AXP)
Number of Hedge Fund Holders: 64
American Express Company (NYSE:AXP) provides payments solutions. Cramer was bullish on the company during his show on May 2 and gave it a Buy rating. He brought up the stock during the Discussed Stock segment of his show and underlined the recent earnings beat of the firm, noting that the stock had declined in value despite posting good results which was a “reflection of the current market and not the firm”.
On April 26, Citi analyst Arren Cyganovich kept a Neutral rating on American Express Company (NYSE:AXP) stock and raised the price target to $190 from $187, appreciating the strong earnings beat of the firm in the first quarter.
Among the hedge funds being tracked by Insider Monkey, Washington-based firm Fisher Asset Management is a leading shareholder in American Express Company (NYSE:AXP) with 15.7 million shares worth more than $2.5 billion.
In its Q2 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and American Express Company (NYSE:AXP) was one of them. Here is what the fund said:
“In financials, American Express Company (NYSE:AXP) has done an excellent job demonstrating the resiliency of its franchise in the midst of a global pandemic that drove a 60% decline in its core travel and entertainment business. The company’s spend-centric model has been helped by fiscal stimulus ensuring a flush consumer, while management continues to execute well by adding millions of new consumer and small and medium business accounts, which should benefit the franchise over the medium to long term. We remain optimistic regarding the company’s prospects as travel and entertainment activity rebounds, adding to our position in the quarter.”
3. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 70
The Coca-Cola Company (NYSE:KO) makes and sells beverages. The journalist investor gave the company a Buy rating during the Discussed Stock segment of his show on May 2. He advised investors to “buy the dip” on some companies, including Coca-Cola, that were posting market-beating earnings but their stock had performed poorly since the market was “not willing to pay as much for those future earnings in this new environment”.
On April 26, Truist analyst Bill Chappell maintained a Buy rating on The Coca-Cola Company (NYSE:KO) stock and raised the price target to $75 from $70, highlighting that the first quarter results of the firm were strong with 18% organic growth “well exceeding” expectations.
Among the hedge funds being tracked by Insider Monkey, Nebraska-based firm Berkshire Hathaway is a leading shareholder in The Coca-Cola Company (NYSE:KO) with 400 million shares worth more than $23 billion.
In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and The Coca-Cola Company (NYSE:KO) was one of them. Here is what the fund said:
“Over the last year, we have repositioned our portfolio to navigate the course we see ahead. We added to more defensive areas of the portfolio like consumer staples (The Coca-Cola Company (NYSE:KO)). While the next month or two will likely prove choppy on account of the Omicron variant, we believe that Omicron, like Delta, represents a speed bump on the way to recovery rather than a true change in course. We see strong economic momentum continuing in 2022 and we expect interest rates to rise. After a decade of remarkably low rates, we would not be surprised if this change in direction is accompanied by some fits and starts in the markets. With our emphasis on pricing power, purposeful sector exposure, valuation discipline, and a strong dividend profile, we believe we are well-positioned for the year ahead.”
2. The Goldman Sachs Group, Inc. (NYSE:GS)
Number of Hedge Fund Holders: 75
The Goldman Sachs Group, Inc. (NYSE:GS) provides a range of financial services. The former hedge fund manager gave the company a Buy rating during the Discussed Stock segment of his show on May 2, according to the Mad Money Stock Screener. As inflation rises and interest rates rise, Cramer has been urging viewers to buy up stakes in financial services firms that are likely to see earnings multiply overnight due to rising rates.
On April 18, BMO Capital analyst James Fotheringham kept an Outperform rating on The Goldman Sachs Group, Inc. (NYSE:GS) stock with a price target of $486, appreciating the ongoing capital and funding optimization by the firm to improve profitability.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Eagle Capital Management is a leading shareholder in The Goldman Sachs Group, Inc. (NYSE:GS) with 3.5 million shares worth more than $1.3 billion.
In its Q4 2021 investor letter, Ariel Investments, an asset management firm, highlighted a few stocks and The Goldman Sachs Group, Inc. (NYSE:GS) was one of them. Here is what the fund said:
“Rising interest rates, after a surprisingly long period of low absolute rates and negative “real” rates, will create a headwind. While there has been much debate about the cause of these low rates, we believe the most important factor has been the $120 billion in monthly federal reserve open market bond purchases and the accumulation of an $8 trillion balance sheet. The former will end, and the latter will shrink. It is not just the Fed that has aggressively purchased bonds, bidding up prices and lowering yields. Bond traders and hedge fund managers have added to positions, confident that being on the same side as the Fed was the wise place to be. Now as the Fed is about to become a seller of bonds rather than a buyer, Wall Street’s “smart money” is likely to follow suit. Against this backdrop, fixed income securities and bond substitutes such as high dividend paying utilities and absolute return hedge funds are substantially overpriced and are not likely to produce attractive returns going forward.
This expectation of a reversion to the mean for interest rates helped 2021 performance, though not as much as we had hoped. The yield on the U.S. 10-year Treasury did indeed increase from +0.92% at the beginning of the year to +1.52% at year-end. An underreported story was the poor performance of bonds last year. The Barclays Aggregate Index declined -1.67% for the year ending December compared to a return of +28.71% for equities as measured by the S&P 500. Interest rates have continued to climb in 2022 with the 10-year Treasury at +1.79% as we go to print. This move higher in rates has contributed to our good, early start to 2022. The Goldman Sachs Group, Inc. (NYSE:GS) jumped +47.59% for the year and +1.73% in the quarter.”
1. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Johnson & Johnson (NYSE:JNJ) makes and sells healthcare products. Cramer was bullish on the stock during the Discussed Stock segment of his show on May 2, highlighting that the drop in the share prices of “great American firms” like Johnson & Johnson was an opportunity to buy. He added that once inflation is broken, investors will not have time to buy the shares at such great prices.
On April 20, Credit Suisse analyst Matt Miksic kept an Outperform rating on Johnson & Johnson (NYSE:JNJ) stock and raised the price target to $205 from $200, noting the better-than-expected growth for the firm across key segments in the past few months.
At the end of the fourth quarter of 2021, 83 hedge funds in the database of Insider Monkey held stakes worth $7.3 billion in Johnson & Johnson (NYSE:JNJ), compared to 88 in the previous quarter worth $6.8 billion.
You can also take a peek at Why These 10 Stocks Are Trending on Monday and 10 ETFs to Buy and Hold for the Next 10 Years.
