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In this article, we will take a look at 10 best Jim Cramer stocks to buy now. If you want to see more best Jim Cramer stocks to buy, go directly to 5 Best Jim Cramer Stocks to Buy Now.
Jim Cramer is a famous TV personality who hosts the show Mad Money. He is also an anchor on Squawk on the Street. Before TV, Jim Cramer ran a hedge fund, Cramer Berkowitz, that did pretty well. In its 14 years, his hedge fund averaged annual returns of 24%.
In terms of his TV picks, Cramer hasn't been as successful as his hedge fund as he often recommends many different stocks across the stock market. As such, it's almost impossible for Cramer to be significantly above average. Investing successfully is more about swinging at good pitches rather than swinging at a ton of pitches. Nevertheless, Cramer can still be informative.
In terms of his picks, Jim Cramer has recommended many different stocks. Given blue chips have historically performed better in the long term, this article will focus more on Jim Cramer's blue chip recommendations.
In terms of Jim Cramer's recent commentary, he had the following comment about the market and his investing club, "Morgan Stanley’s Mike Wilson says he has seen enough of the rally, and he says it’s time to bail. There’s less than 2% upside at the high end of his year-end S&P 500 price target of 4,000 to 4,150. Stay with defensive stocks and utilities. The industrials have been carrying the market. I wrote about some of the hot old-school stocks lately and how we’re playing the sector for the Club.'
2022 has been a volatile year given the Federal Reserve has increased interest rates substantially to fight inflation. As a result of the interest rate increases, demand for many companies is lower than what it was before and broader market valuations have declined as capital has moved from equities to the Treasuries.
Although inflation is showing signs of potentially peaking, many investors believe the Federal Reserve will continue to raise rates further. If the U.S. central bank raises rates too much, the U.S. economy could enter into a recession next year and the fundamentals of even blue chips could weaken. There could be more downside if economic data fails to meet expectations. As such, it could be a good idea for long term investors to own a well diversified portfolio of stocks across many different sectors.
Methodology
For our list of 10 Best Jim Cramer Stocks to Buy Now, we picked 10 stocks with competitive advantages that Jim Cramer has recommended before.
We then ranked the 10 stocks based on the number of hedge funds in our database that held shares in the same stock at the end of the third quarter.
10 Best Jim Cramer Stocks to Buy Now
10. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 69
The Procter & Gamble Company (NYSE:PG) is a consumer staple whose shares have declined around 8% year to date given the strong U.S. dollar and high inflation. Given the macroeconomic headwinds, Jim Cramer acknowledges The Procter & Gamble Company (NYSE:PG) is 'off its game' but believes the conglomerate's strength will be back.
In terms of expectations, analysts expect The Procter & Gamble Company (NYSE:PG)'s EPS to be $5.82 per share in 2022, $5.81 per share in 2023, $6.23 per share in 2024, and $6.73 per share in 2025. Although a global recession could make 2023 earnings per share more difficult to achieve, The Procter & Gamble Company (NYSE:PG) has had a long history of EPS growth over time and the company has substantial normalized earnings power in the long term. As of 2022, The Procter & Gamble Company (NYSE:PG) has increased its annual dividend for 66 straight years.
Alongside Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Microsoft Corporation (NASDAQ:MSFT), The Procter & Gamble Company (NYSE:PG) is a stock that Jim Cramer has liked and that's owned by many hedge funds in our database at the end of Q3 2022.
9. Goldman Sachs Group, Inc. (NYSE:GS)
Number of Hedge Fund Holders: 69
Goldman Sachs Group, Inc. (NYSE:GS) is a leading Wall Street bank whose shares Jim Cramer termed 'a steal' in the middle of January after the company's earnings miss in Q4 2021.
While it didn't do well for the last quarter of 2021, Goldman Sachs Group, Inc. (NYSE:GS)'s Q3 2022 results were better. For the period, the bank reported EPS of $8.25 on revenue of $11.98 billion versus the consensus of $7.69 on sales of $11.41 billion. Annualized ROE was 11% while Goldman Sachs Group, Inc. (NYSE:GS) ended the quarter with a book value per share of $308.22. Third quarter trading revenue was $6.2 billion.
Of the 920 hedge funds in our database, 69 were long Goldman Sachs Group, Inc. (NYSE:GS) at the end of Q3, ranking the bank #9 on our list of 10 Best Jim Cramer Stocks to Buy Now.
8. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders: 70
Given macroeconomic headwinds, sports clothing giant NIKE, Inc. (NYSE:NKE) stock has declined from around $165 in the beginning of the year to around $110 per share now. Despite the decline and NIKE, Inc. (NYSE:NKE)'s poor first quarter results, Jim Cramer commented that "I don’t think buying Nike here is that bad" in November when shares were below $100 per share.
To be fair, however, Cramer has also liked NIKE, Inc. (NYSE:NKE) when its stock price was higher than $110 too. Given its normalized earnings power, NIKE, Inc. (NYSE:NKE) still has earnings growth potential in the long term.
7. Union Pacific Corporation (NYSE:UNP)
Number of Hedge Fund Holders: 74
Union Pacific Corporation (NYSE:UNP) ranks #7 on our list of 10 Best Jim Cramer Stocks to Buy Now given 74 hedge funds in our database owned shares of the leading railroad at the end of September. Cramer is a fan of Union Pacific Corporation (NYSE:UNP) which he thinks is the best railroad. He said in January, "They’re forecasting strong volume growth, pricing gains that should outpace inflation, and better efficiency. Put it all together and Union Pacific should be able to throw off a ton of cash. Management promises to spend a lot of that money paying dividends and buying back stock, which is exactly what Wall Street likes to hear in an environment like this one."
74 hedge funds in our database were long Union Pacific Corporation (NYSE:UNP) at the end of the third quarter.
6. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 85
Jim Cramer commented on Johnson & Johnson (NYSE:JNJ) in October of this year, "I like the way J&J’s been trading over the last couple months, and after the quarter we saw this morning I think it is precisely the kind of stock that you need to buy as we head into 2023, which should be a much better year... J&J is a textbook recession-proof stock. … It’s exactly the kind of name you want to own when the Federal Reserve decides to slam the brakes on the economy." Although Cramer does acknowledge that the strong dollar and cost inflation are headwinds, he thinks the issues will be less prominent next year.
85 hedge funds we track owned shares of Johnson & Johnson (NYSE:JNJ), ranking the stock #6 on our list of 10 Best Jim Cramer Stocks to Buy Now.
Like Johnson & Johnson (NYSE:JNJ), Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Microsoft Corporation (NASDAQ:MSFT) are stocks Jim Cramer has liked and that's owned by many hedge funds in our database at the end of Q3 2022.
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Disclosure: None. 10 Best Jim Cramer Stocks to Buy Now is originally published on Insider Monkey.
