CNBC’s Jim Cramer on Wednesday offered investors a list of seven semiconductor chip stocks he believes could be attractive buys.
“I think there’s a sense that the chipmakers will get hurt as we head into a [Federal Reserve]-mandated recession,” the “Mad Money” host said, referring to the Fed’s upcoming interest rate hikes. “At these levels, I think a bunch of them have started to look pretty enticing,” he added.
Here are his picks for the best semiconductor stocks that have reasonable valuations and earnings growth:
Micron
Western Digital
Advanced Micro Devices
Skyworks Solutions
KLA
Lam Research
Applied Materials
“Growth at a reasonable price abounds in this beaten-down market, and that includes the more controversial semiconductor space. Just be aware that these chip stocks might remain at a reasonable price for the foreseeable future because Wall Street has just got no love — until today — for this entire darn group,” he said.
Cramer’s latest list of investable growth stocks comes after he earlier this week highlighted four financial stocks and six travel and leisure stocks buyers should have on their radars. To pick his favorite stocks in each sector, Cramer has used the same list of stocks containing companies from the S&P 500 that meet his criteria for having a reasonable valuation and earnings growth.
Disclosure: Cramer’s Charitable Trust owns shares of AMD.
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CNBC’s Jim Cramer on Friday looked ahead to next week’s of earnings reports, detailing for investors his key market events to keep an eye on.
The “Mad Money” host’s comments came after all three major U.S. equity indexes closed at record highs Friday, despite disappointing quarterly results a day earlier from market heavyweights Amazon and Apple.
All revenue and per-share earnings projections are based on FactSet estimates:
Mad Money with Jim Cramer
Monday: ON Semiconductor, NXP Semiconductors, Diamondback Energy and Clorox
On Semiconductor
Q3 results before the bell; conference call at 9 a.m. ET Monday
Projected EPS: 74 cents
Projected sales: $1.7 billion
NXP Semiconductors
Q3 results; conference call at 8 a.m. ET Tuesday
Projected EPS: $2.75
Projected sales: $ 2.85 billion
Both companies’ earnings will offer “a read on one of the biggest stories in this market, and that’s the semiconductor shortage,” Cramer said. “They do a lot of auto semis, and they’ve got exposure to many of the others areas where there are the biggest bottlenecks.”
Diamondback Energy
Q3 results after the close; conference call at 9 a.m. ET Tuesday
Projected EPS: $2.79
Projected revenue: $1.54 billion
Clorox
Q1 2022 results after the bell; conference call at 5:30 p.m. ET Monday
Projected EPS: $1.03
Projected revenue: $1.7 billion
“I hope for the best, but I am preparing for the worst,” Cramer said, noting the household products maker may not be able to pass through all of its higher commodity costs, possibly hurting margins.
Q1 2022 results before the open; conference call at 9:30 a.m. ET Tuesday
Projected EPS: $1.70
Projected sales: $4.25 billion
DuPont
Q3 results before the bell; conference call at 8 a.m. ET Tuesday
Projected EPS: $1.12
Projected sales: $4.16 billion
Cramer’s charitable trust owns both Estee Lauder and DuPont. “I don’t expect them to have superb quarters. Fortunately, the expectations are low, though, so it won’t take much to produce an upside surprise that moves the stocks up,” he said.
Pfizer
Q3 results before the open; conference call at 10 a.m. ET
Projected EPS: $1.08
Projected revenue: $22.58 billion
“Unlike Moderna, Pfizer’s a lot more complicated than just a Covid vaccine story. See, they’re facing what’s known as a patent cliff next year,” Cramer said. “We need to know if the boosters, which cost a lot of money, … are going to cover the patent cliff.”
BP
Q3 results before the bell; conference call at 5 a.m. ET Tuesday
Projected EPS: £ 10.83
Projected revenue: £29.06 billion
Devon Energy
Q3 results after the close; conference call at 11 a.m. ET Wednesday
Projected EPS: 93 cents
Projected sales: $3.23 billion
T-Mobile
Q3 results after the close; conference call at 4:30 p.m. ET Tuesday
Projected EPS: 48 cents
Projected revenue: $20.22 billion
“The [telecommunications] industry has got a clear pecking order: T-Mobile for growth, Verizon for the dividend, and AT&T for nothing. Let’s see how many subscribers T-Mobile has been able to steal from its rivals when they report,” Cramer sad.
Zillow
Q3 after the close; conference call at 5 a.m. ET Tuesday
Projected EPS: 16 cents
Projected revenue: $2 billion
“They had to put the real estate flipping business on pause because the economics turned out against them, but what does that really mean? We’re going to find out on Tuesday,” Cramer said.
Q3 results before the bell; conference call at 8 a.m. ET Wednesday
Projected EPS: $1.79
Projected revenue: $70.5 billion
“This stock’s been on a roll, bolstered by Covid vaccines and superior execution, at least compared to arch-rival Walgreens. I don’t know if it can continue now that the pandemic’s winding down, but remember that CVS also has a huge health insurance business,” Cramer said.
Humana
Q3 results before the open; conference call at 9 a.m. ET Wednesday
Projected EPS: $4.66
Projected revenue: $20.9 billion
Cramer said he expects the health insurer’s numbers to be even better than rivals Centene and UnitedHealth Group.
Marriott International
Q3 results before the bell; conference call at 8:30 a.m. ET Wednesday
Projected EPS: 99 cents
Projected sales: $3.71 billion
Wynn Resorts
Q3 results after the close
Projected EPS: Loss of $1.36
Projected revenue: $943 million
Cramer said he expects Marriott International to have a better story to tell about the hospitality recovery compared to Wynn Resorts, which his charitable trust owns. He said that’s because of Wynn Resorts’ exposure to the gaming hub of Macau.
Qualcomm
Q4 results after the close; conference call at 4:45 p.m. ET Wednesday
Projected EPS: $2.26
Projected revenue: $8.85 billion
“They’ll give us more insight into the cellphone market, but I bet that can’t be that positive, either,” Cramer said, alluding to the chip crunch.
Etsy
Q3 results after the close; conference call at 5 p.m. ET Wednesday
Projected EPS: 55 cents
Projected revenue: $519 million
“I bet CEO Josh Silverman will have a lot of good to say about his e-commerce platform for handicrafts—should make a nice contrast to Amazon’s disappointing quarter,” Cramer said.
Thursday: Uber, Skyworks Solutions, Peloton and Square
Uber
Q3 results after the close; conference call 5 p.m. ET Thursday
Projected EPS: Loss of 34 cents
Projected revenue: $4.41 billion
“I think Uber can deliver, but the stock’s been kept down by persistent sellers, so even a good quarter might not matter, at least not until these weak hands finish dumping their shares,” Cramer said.
Skyworks Solutions
Q4 results after the bell; conference call at 4:30 p.m. ET Thursday
Projected EPS: $2.55
Projected sales: $1.3 billion
“Maybe they give us some insight into when the chip shortage nightmare can come to an end,” Cramer said.
Peloton
Q1 2022 results after the close; conference call at 5 p.m. ET Thursday
Projected EPS: Loss of $1.10
Projected sales: $809 million
The fitness equipment maker was a major pandemic winner, but the stock has struggled to gain traction since investors shifted toward reopening plays, Cramer said. “I think they’ve got their work cut out for them.”
Square
Q3 results after the close; conference call at 5 p.m. ET Thursday
Projected EPS: 37 cents
Projected revenue: $4.38 billion
“I’m betting their mojo will be absent for now, mojo being a technical term on Wall Street for the massive love a stock gets after a monster beat and raise quarter,” Cramer said.
Friday: Enbridge and October nonfarm payrolls
Enbridge
Q3 results before the bell; conference call at 9 a.m. ET Friday
Projected EPS: 57 cents
Projected revenue: $9.62 billion
Cramer said he likes the company’s dividend payment. “Plus, we have a real shortage of energy infrastructure, so I bet business is good,” Cramer said.
The Labor Department’s report on nonfarm payrolls for the month of October is out at 8:30 a.m. Friday, but Cramer cautioned the recent monthly reports have been “all over the map right now,” making their appearance “seem deceiving.”
EVgo: “It’s one of our favorites, but remember there are four of them that are gunning for this business, and that means it’s not all going to go to one player so be careful. It is really speculative.”
Piedmont Lithium: “Lithium is a tough, tough market, so anytime I see one of the lithium stocks I say be very, very careful. Piedmont Lithium had some of sort permitting issue that kept its stock down. … If you want to play a lithium stock, I guess that’s a good one. Not my favorite.”
FuboTV: “Fubo just reported, and it looks like a dynamite quarter. Stock is up 10% [in after-hours trading]. There was a time when I couldn’t even pronounce it, but now I know it. They should come on [the show].”
Skyworks Solutions: “I don’t understand this stock. I don’t understand why it keeps going down. I don’t understand why people don’t like it. They have the Apple business. They made a great acquisition. They’re diversifying away. I think people who are selling this stock are going to sorely regret that they sold it.
Paysafe Limited: “I like Paysafe. Man, have I ever been wrong. I’ve been pantsed by the stock of Paysafe and yet I’m still sticking by it because of that customer list. I’m with you. The customer list is too good for us to both be wrong.”
Rxsight: “Man, I don’t know. That stock, it’s not holding up there. A lot of people are selling that stock from nine ways to Sunday. I’ve got to be careful about that one. I think you’ve got to be careful about that one.”