On Monday, Jim Cramer, host of Mad Money, took a closer look at the current status of the Magnificent Seven stocks, offering insight into both their market positioning and how the White House’s stance seems to be shifting.
“First, I can’t be sure that Trump has changed, but I do believe that he’s never lost sight of the markets and he watches the business channels.”
READ ALSO: Jim Cramer Recently Put These 10 Stocks Under Spotlight and Jim Cramer Recently Talked About These 5 Subscription Stocks
Cramer emphasized that his analysis is not political, rather, it is a “clear-eyed” assessment of what the president aims to achieve. According to Cramer, Trump is pushing for more jobs and manufacturing within the U.S., even if it means sacrificing access to cheap goods from overseas. Turning his attention to the Magnificent Seven stocks, Cramer said:
“Everybody knows the Magnificent Seven is not so magnificent anymore… But as I said over and over again, you simply can’t count these stocks out.”
He explained that these stocks still hold significant value despite their significant drops from their peak highs. For Cramer, these companies are not to be dismissed lightly. He mentioned that six of them are part of his Charitable Trust, making them especially relevant to his analysis. He noted that some serious damage had been done to the group.
As Cramer continued his commentary, he pointed out that analyst sentiment toward the Magnificent Seven has become more positive after a year of skepticism. However, he highlighted that only Amazon and Nvidia have truly favorable setups at the moment. For the others, it remains to be seen what the future holds. Regardless of their uncertain outlooks, Cramer noted one important factor common to all these companies: as their stock prices fall, they actually become more affordable.
“Their stocks actually truly do get cheaper as they go lower, and that’s more than I can say for many others that have held up well during this exceedingly difficult period.”
Our Methodology
For this article, we compiled a list of stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 24. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
7. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 126
Cramer highlighted Tesla (NASDAQ:TSLA) as a “tech company” and said:
“Finally, there’s the one that everyone’s been dumping on and that’s Tesla. I think that people are misunderstanding the power of Tesla, the tech company. At these prices, Tesla, the car company, could have sales that were cut in half and I don’t know how much lower it would go.”
Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells electric vehicles and energy products. The company offers a range of services, including vehicle sales, financing, energy storage solutions, solar energy systems, and other related services to a wide range of customers. Polen Capital stated the following regarding the company in its Q4 2024 investor letter:
“The largest relative detractors in the quarter were Tesla, Inc. (NASDAQ:TSLA) (not owned), Thermo Fisher Scientific, and Broadcom (not owned). We’ve spoken at length about our rationale for not owning Tesla. The stock enjoyed a 54% return during the quarter, with effectively all of the share price performance strength coming in the post-election period, as the market expressed a positive view on Elon Musk’s prominent role in the incoming Trump administration and its potential implications for Tesla. While we agree this development should be a net positive for Tesla and recognize the company’s interesting future prospects for autonomous driving and humanoid robots, its current valuation demands that shareholders pay primarily for potential innovations that have yet to materialize, with uncertain risks and timelines, presenting a different type of risk profile than we are comfortable with. Today, Tesla is an automobile manufacturer limited to the higher-income segment and is increasingly challenged to sell vehicles when interest rates are not zero. As such, we continue to question the company’s long-term growth profile, its ability to scale a large robotaxi service (which seems to be the source of euphoria in Tesla shares), and its corporate governance.”
6. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 223
While Cramer was bullish on NVIDIA Corporation (NASDAQ:NVDA), he did express concern over the death cross pattern.
“Six, we saw Nvidia up close and personal last week and I was actually blown away. I believe in the earnings. In fact, I think the AI infrastructure spending will only get stronger when they roll out new chips next year, cheap. Now, I am concerned about this death cross thing, a pattern where the 50-day moving average slices through a 200-day, signaling a real breakdown. I wouldn’t normally mind, but there’s so many double inverse Nvidia ETFs and zero-day options. Those have the power to be the tail that wags the dog sometimes. That is worrisome. I, we need to see this thing break out of that whole death cross stuff. We can take that out of the equation.”
NVIDIA (NASDAQ:NVDA), recognized for its innovations in graphics, computing, and networking technologies, is fueling substantial growth with its GPUs and the CUDA software platform, which are essential components of AI infrastructure.
Hedge Fund Resource Center