We recently published a list of Jim Cramer’s Latest Calls: 10 Stocks to Buy and Sell Now. Since Lennar (NYSE:LEN) ranks 7th on the list, it deserves a deeper look.
Jim Cramer in a recent program on CNBC yet again talked about the importance of investing in individual stocks and said with discipline and patience beginner investors can beat the market by picking solid stocks with strong fundamentals.
“If you are willing to put in the work, regular people can trounce the averages as long as you are disciplined and you follow the rules,” Cramer said.
Talking about his stock-picking process, Cramer said that he likes to “start” hunting for stocks by going through the list of stocks making new highs. This is a good start, according to Cramer, because a lot of times momentum keeps pushing the same stocks higher and higher unless something fundamentally changes. Cramer said he does not recommend buying stocks when they are trading at new highs. Instead, he waits for a pullback.
“New high list is not a shopping list it’s an inspirational list. You keep an eye on those names and then wait for them to come down before you pull the trigger,” Cramer said.
Cramer said that you should only pile into stocks on a pullback if you believe they will rebound for reasons “unrelated to the broader market.”
For this article, we picked 10 key stocks Jim Cramer is talking about during his programs these days. With each stock, we have mentioned the number of hedge fund investors. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Lennar (NYSE:LEN)
Number of Hedge Fund Investors: 60
Commenting on Lennar (NYSE:LEN) in a recent program, Jim Cramer said the company is the “biggest and the best” and executive chairman Stuart Miller has “done a remarkable job.”
Jim Cramer said “every number” in the company’s latest earnings was “good.”
He said that the notion that flat gross margin guidance for the next quarter was a good reason to sell the stock is “stupid.”
Cramer said he’d like to “congratulate” the company for performing well despite the tough environment.
Lennar (NYSE:LEN) indeed performed well but lower-than-expected margins in the quarter and weak guidance for the metric impacted the stock prices. However, analysts believe with interest rate cuts and mortgage declines Lennar is positioned well to benefit from a rise in housing demand.
Overall, Lennar (NYSE:LEN) ranks 7th on Insider Monkey’s list titled Jim Cramer’s Latest Calls: 10 Stocks to Buy and Sell Now. While we acknowledge the potential of Lennar (NYSE:LEN), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than LEN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.