Jim Cramer Says You Should Avoid These 11 Stocks
In this article, we will take a detailed look at Jim Cramer Says You Should Avoid These 11 Stocks. For a quick overview of such stocks, read our article Jim Cramer Says You Should Avoid These 5 Stocks.
Jim Cramer in his latest program took a jab at the Department of Justice and Washington authorities in general, calling regulators “anti-innovation” who have “contempt” against those who became rich in the technology sector. Cramer was referring to the DoJ’s antitrust lawsuit against Apple Inc (NASDAQ:AAPL), which accused the iPhone maker of throttling competitive alternatives from other companies and trying to maintain a monopoly in the smartphone market. Cramer said that the regulators hate and “abhor” big businesses because the bigger they are the more successful they become. Jim Cramer, who has been repeatedly recommending Apple Inc (NASDAQ:AAPL) during his programs, uring investors to “hold it, not trade it,” said that Washington’s “anti-business bias” was evident when it brought the lawsuit against Apple Inc (NASDAQ:AAPL) on what Cramer called a “shameful day.”
Why Cramer Loves Apple Inc (NASDAQ:AAPL) So Much?
Cramer then highlighted the reasons why he’s been so bullish on Apple, and these thoughts provide an interesting sneak peek into what goes on in Cramer’s mind when he’s choosing stocks for the long-term. Cramer said he did not ask his viewers to hold Apple stock for the long term because it’s a stock with a relatively low P/E ratio or because it has “got the hottest technology out there?” These were not the reasons behind Cramer’s bullish outlook on Apple. Cramer said he recommended holding onto Apple shares because it’s the “most innovative consumer products technology company ever.”
Cramer Thinks DoJ Has a "Loser Case" Against Apple
In a blunt move, Cramer grabbed a copy of the DoJ’s case against Apple and threw it away, calling it a “loser” case which does not hold any merit. Cramer said that he isn’t worried at all about the DoJ’s case against Apple because he knows a “loser case” when he “sees it.” According to Cramer, Apple pays the “most taxes” and creates the “most jobs.”
Cramer said the pullback in Apple shares after the case was expected, but he sees it as a buying opportunity which long-term investors would look back to and thank the Department of Justice for.
While Jim Cramer is recommending investors to pile into Apple Inc (NASDAQ:AAPL), in addition to other tech names like NVIDIA Corp (NASDAQ:NVDA) and Microsoft Corp (NASDAQ:MSFT), he is bearish on some stocks. In this article we will take a look at the stocks he's recommending investors to stay away from.
11. Plains All American Pipeline, L.P. (NASDAQ:PAA)
Number of Hedge Fund Investors: 5
Jim Cramer was recently asked about midstream energy infrastructure company Plains All American Pipeline, L.P. (NASDAQ:PAA). Cramer said:
“I see you, and I raise you with Enterprise Products Partners.”
Cramer also said that Enterprise Products Partners is a “better” company than Plains All American Pipeline, L.P. (NASDAQ:PAA).
Last month, during its earnings call, Plains All American Pipeline, L.P. (NASDAQ:PAA) management talked about guidance and expectations:
"Looking at 2024 compared to 2023 and as illustrated by the EBITDA walk on Slide 9, we expect adjusted EBITDA of $2.625 billion to $2.725 billion with year-over-year growth in our Crude Oil segment, partially offsetting commodity price headwinds in our NGL segment. Growth in our Crude Oil segment is primarily driven by anticipated tariff volume increases, higher fees from tariff escalators and full year contributions from bolt-on acquisitions. This is partially offset by our assumption of fewer market-based opportunities. We expect lower year-over-year NGL segment adjusted EBITDA, driven by lower forecasted frac spreads, partially offset by higher C3 plus spec product sales in 2024. I would note that our C3 plus spec product sales volumes are approximately 90% hedged for the year in the mid $0.60 per gallon level.
We remain disciplined with our capital investments with approximately $375 million of growth capital and approximately $230 million of maintenance capital expected for the year, net to PAA. This includes capital for POP JV well connections and intra-basin improvement as well as an increase in our capital related to our previously announced Fort Sask debottleneck project. As illustrated on Slide 10 and in addition to a capital discipline, we remain committed to significant returns of capital and maintaining financial ability. For 2024, we expect to generate $1.65 billion of adjusted free cash flow excluding changes in assets and liabilities with approximately $1.15 billion to be allocated to common and preferred distributions inclusive of the respective increases resulting in $500 million of adjusted free cash flow after distributions available for value-creating opportunities, including potential bolt-on acquisitions or net debt reduction."
Read the full earnings call transcript here.
10. Soundhound AI Inc (NASDAQ:SOUN)
Number of Hedge Fund Investors: 13
AI-based voice technology solutions company Soundhound AI Inc (NASDAQ:SOUN) is another stock Jim Cramer is recommending investors to stay away from for now. While Cramer has expressed excitement about the stock in the past because of Soundhound AI Inc's (NASDAQ:SOUN) partnership with Nvidia, the CNBC host recently said that he won’t buy the stock even at $6 (the stock was trading at around $6.14 as of March 25).
Out of the 933 funds in Insider Monkey’s database, 13 hedge funds had stakes in Soundhound AI Inc (NASDAQ:SOUN).
9. Comstock Resources Inc (NYSE:CRK)
Number of Hedge Fund Investors: 18
Texas-based energy company Comstock Resources Inc (NYSE:CRK) is one of the stocks Jim Cramer is currently avoiding. When asked about Comstock Resources Inc (NYSE:CRK) during the Lightning Round segment of his program on CNBC, Cramer said that there are “so many better” companies than Comstock Resources Inc (NYSE:CRK).
“I’m going to have to refer you to get to Coterra, CTRA, which is just a better situation.”
Insider Monkey’s database of 933 funds shows that 18 hedge funds had stakes in Comstock Resources Inc (NYSE:CRK) as of the end of the last quarter of 2023. The most notable stake in Comstock Resources Inc (NYSE:CRK) is owned by Todd J. Kantor’s Encompass Capital Advisors which owns a $31 million stake in Comstock Resources Inc (NYSE:CRK).
While Cramer is bearish on CRK, he's recommending investors to pile into NVIDIA Corp (NASDAQ:NVDA), Microsoft Corp (NASDAQ:MSFT) and Apple Inc (NASDAQ:AAPL).
During its Q4 earnings call, the company talked about 2024 guidance:
"First quarter D&C CapEx guidance is $225 million to $275 million and the full year D&C CapEx guidance is $750 million to $850 million. The lower spending versus last year is related to the announced release of two drilling rigs in our press release last night in response to low gas prices. We’ve continued to see signs of some deflationary pressures on service costs, including an improvement in our completion costs per stage. We anticipate spending an additional $30 million to $40 million on lease acquisitions in the first quarter and $40 million to $50 million over the course of the year. Capital expenditures related to Pinnacle Gas Services will be funded by our midstream partner and are expected to total $30 million to $40 million in the first quarter and $125 million to $150 million for the full year.
For both the first quarter and the full year, our LOE is expected to be in a range of $0.24 to $0.28 per Mcfe. GTC are expected to be $0.32 to $0.36 per Mcfe and production and ad valorem taxes are expected to average $0.16 to $0.20 per Mcfe. DD&A rate is expected to average $1.30 to $1.40 per Mcf this year. In the first quarter, our cash G&A is expected to total $7 million to $9 million and $30 million to $34 million for the full year. In addition, we’ll have non-cash G&A in the first quarter of $2.7 million to $3 million and $10 million to $12 million for the full year. With the increase in SOFR rates in our current debt levels, cash interest expense is now expected to total $43 million to $47 million in the first quarter and $195 million to $205 million for the year, while non-cash interest will remain approximately $2 million per quarter.
Effective tax rate will remain in the 22% to 25% range and we continue to expect to defer 95% to 100% of our reported taxes this year."
Read the full earnings call transcript here.
8. Mannkind Corp (NSDAQ:MNKD)
Number of Hedge Fund Investors: 18
Mannkind Corp (NSDAQ:MNKD) is a stock Jim Cramer is having mixed feelings about, and he’s recommending investors to stay away from the biopharma company for now. Cramer recently said during his program that Mannkind Corp (NSDAQ:MNKD) has been “hanging out there forever.” Cramer however acknowledged that it’s “finally” starting to look like Mannkind Corp (NSDAQ:MNKD) will have an “earnings breakout.”
“But I am one of those people who’s jaundiced about it. I got to wait to see if they come up with something.”
Cramer said that for now he cannot just say that the stock is looking better.
“I’m not gonna go there,” Cramer added.
7. iRobot Corp (NASDAQ:IRBT)
Number of Hedge Fund Investors: 18
Consumer robots company iRobot Corp (NASDAQ:IRBT) stock is among the ones Jim Cramer is bearish on. Cramer hit “Sell, Sell, Sell” on the stock when he was asked about iRobot Corp (NASDAQ:IRBT) recently in his program. Cramer said that iRobot Corp (NASDAQ:IRBT) products might be on sale at Costco stores but the stock is a Sell.
Insider Monkey’s database of 933 funds shows that 18 hedge funds had stakes in iRobot Corp (NASDAQ:IRBT).
6. indie Semiconductor Inc (NASDAQ:INDI)
Number of Hedge Fund Investors: 19
Automotive fabless company indie Semiconductor Inc (NASDAQ:INDI) is one of the stocks Jim Cramer is not excited about. When asked about indie Semiconductor Inc (NASDAQ:INDI) during the Lightning Round program on CNBC recently, Cramer said that he is not interested in Advanced Driver-assistance Systems (ADAS) or self-driving technologies. While INDI is not liked by Cramer, he is recommending investors to buy NVIDIA Corp (NASDAQ:NVDA), Microsoft Corp (NASDAQ:MSFT) and Apple Inc (NASDAQ:AAPL).
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Disclosure. None. Jim Cramer Says You Should Avoid These 11 Stocks was initially published on Insider Monkey.