Jim Cramer Recommends that Investors Stick with ‘Magnificent Seven’ Tech Stocks

UTC by Tolu Ajiboye · 3 min read
Jim Cramer Recommends that Investors Stick with ‘Magnificent Seven’ Tech Stocks
Photo: Mad Money On CNBC / Twitter

Cramer has enough reason to believe that investors are better off keeping their money in the Magnificent Seven than other stocks.

TV personality and author Jim Cramer has again touted his undying recommendation of his “Magnificent Seven” stocks. According to him, investors should stick to these stocks as they have the strength to withstand heavy market movements.

Cramer’s Magnificent Seven comprises Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN), Meta (NASDAQ: META), Tesla (NASDAQ: TSLA), Alphabet (NASDAQ: GOOGL), Nvidia (NASDAQ: NVDA), and Microsoft (NASDAQ: MSFT). The former hedge fund manager also suggested that the Magnificent Seven makes it easy for him to discuss stocks because their price targets are usually rising instead of falling. Cramer said:

“It’s just so darned easy to bet on the ‘Magnificent Seven’ because everything always seems to go right with them. While the group might get hit because of the Nasdaq 100 rebalancing or a bizarre move in the bond market or even some terrible inflation number tomorrow morning, you know the analysts will come out of the woodwork and they have no shortage of reasons to recommend them.”

As part of his high praise for these stocks, Cramer spoke on Nvidia and how the company maintains its health via innovation. According to Cramer, the attraction to Nvidia’s stock may not be heavy earnings per share in the short term. However, investors can rest assured that the chipmaker can endure “inevitable downdrafts” as the company plays “at a different higher level than any other company in the universe.” 

Cramer’s Continuous Magnificent Seven Praise 

Last month, Cramer spoke about the Magnificent Seven, saying competing with them would be a bad idea. The TV host spoke on the reason why these stocks are successful, highlighting Apple’s high rate of customer satisfaction, Meta’s play at artificial intelligence (AI), and Nvidia’s graphics cards supply that pumped the company’s quarterly guidance by $4 billion at the time. In addition, Cramer praised Microsoft’s bet on ChatGPT, Alphabet’s involvement in AI, and Tesla’s high profits from selling great cars at affordable prices.

Unsurprisingly, not everyone is as excited as Cramer about the Magnificent Seven. Last month, stock market commentator Nigel Green warned that investors should favor diversification over anything else. According to Green, investors should be careful about all the buzz on these stocks. Green also added that heavy reliance on a particular sector or a few big tech stocks may result in investor vulnerability to undue risk.

The Tech Reign

Meta evolved from Facebook to focus more on the metaverse and has invested in mixed reality devices, recently announcing the new Meta Quest 3 headset. Although the metaverse has not caught on as expected, Meta’s projected earnings growth is 24.96%, with earnings per share expected to hit $14.92 from $11.94.

Apple also entered the mixed reality business and announced the Vision Pro headset. Currently, at $2.97 trillion, Apple’s market cap hit $3 trillion late last month. There’s also Tesla, currently at $271.61 in premarket trading, with a market cap of over $854 billion. The successful EV maker has returned 119% to investors since January and 49% in the last three months. Overall, Cramer’s Magnificent Seven stocks have been performing quite well and are unlikely to falter soon.

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