We recently published an article titled, 11 Stocks on Jim Cramer’s Radar Right Now. In this article, we are going to take a look at where Tesla, Inc. (NASDAQ:TSLA) stands against other stocks on Jim Cramer’s radar right now.
In his recent episode of Mad Money, host Jim Cramer focused on the upcoming market events, emphasizing the importance of new consumer price index data alongside a series of reports as the earnings season kicks off.
Cramer pointed out that the Labor Department’s nonfarm payroll report revealed significant job growth in September, surpassing expectations. He highlighted the significant rally in stocks on Friday, a response to better-than-expected job creation figures. The U.S. economy added 254,000 jobs in September, significantly exceeding Wall Street’s estimate of 150,000. Additionally, there were upward revisions for the previous two months, with 72,000 more jobs reported for July and August combined.
Despite his initial expectation that stocks would decline as bond yields surged, Cramer noted the resilience in the market. He observed that people seemed to feel relief, thinking that a major economic downturn was not on the horizon, which prompted a flurry of buying activity in the stock market. He added, “Maybe we aren’t headed toward a landing at all.” He described the situation as quite unusual and, in his view, “quite exciting”.
He mentioned that on Wednesday, the Federal Open Market Committee will publish notes from its last month’s meeting, which could clarify the central bank’s bold choice to cut interest rates by 50 basis points. According to Cramer, Wall Street is rife with speculation about the Federal Reserve’s future actions, especially following strong labor statistics released last Friday. As speculation swirls around whether the next cut will be 25 or 50 basis points, Cramer leaned towards the belief that it would likely be 25 or nothing at all. He added:
“Then again, what really matters is the overall direction for rates, and that direction is most definitely lower, which is bullish for stocks.”
He also mentioned that Friday would bring the producer price index report, which, like the consumer price index, will serve as a critical indicator for the Fed’s upcoming decisions. Cramer commented:
“Here’s the bottom line: a market that appreciates good news, like a robust job creation number, is a market that can handle, well, let’s just say, the historically tough month of October. After today’s performance, all I can say is so far so good.”
Our Methodology
For this article, we compiled a list of 11 stocks that were mentioned by Jim Cramer during his episode of Mad Money on October 4. We listed the stocks in ascending order of their hedge fund sentiment as of the second quarter, which was taken from Insider Monkey’s database of more than 900 hedge funds.
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).
Cramer Says To Buy Tesla, Inc. (NASDAQ:TSLA) Ahead Of ‘We, Robot’ Event
Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 85
Tesla, Inc. (NASDAQ:TSLA) is one of the biggest names in the electric vehicle and energy sectors. It is engaged in the design, development, manufacturing, leasing, and sales of electric vehicles and energy generation and storage systems across the globe.
In the Automotive segment, the company offers a range of electric vehicles alongside automotive regulatory credits. The Energy Generation and Storage segment is dedicated to solar energy systems and energy storage products. It includes the design, installation, leasing, and repair services related to these products.
Cramer called attention to the company and stated:
“… we have one of the most exciting meetings ever, and that’s going to be Elon Musk’s ‘We, Robot’ event. Okay. This is for the strategy for autonomous driving. I think this meeting will show off Tesla’s technological edge and will be incredibly well-received. And you won’t think of it as a car company after this meeting. You’ll think of it as a tech company. And that’s why I think you should buy the stock ahead. Okay, ahead of this meeting.”
As Tesla (NASDAQ:TSLA) prepares for its upcoming unveiling of the autonomous “robotaxi” on October 10, analysts are closely monitoring developments. Elon Musk has expressed confidence in the advancements in driverless technology, along with innovative AI products and robotics. He has mentioned that they could significantly increase Tesla’s market valuation.
On October 2, Baird analyst Ben Kallo made a note of the company’s reported deliveries in Q3 that slightly exceeded consensus expectations but fell short of Baird’s estimates. However, energy storage deployments reached 6.9 GWh, marking the second-highest quarterly total in the company’s history.
Analysts at Baird view the upcoming robotaxi announcement as a pivotal event and maintain an Outperform rating on the company stock, setting a price target of $280.
Baron Partners Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q2 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) manufactures electric vehicles, related software and components, and solar and energy storage products. The stock contributed as Tesla continued to drive vehicle manufacturing costs lower, accelerate the launch of new models, and invest heavily in its lucrative AI initiatives. Shareholders reaffirmed the CEO’s compensation plan, alleviating personnel and legal uncertainties. Despite material operational complexities resulting in significant shutdowns of key manufacturing facilities and lower sales volume, Tesla presented better-than-expected margins in the quarter. It expects to launch a lower cost model as soon as late 2024, which should result in accelerated revenue growth, reduced manufacturing costs, and increased factory utilization. The company continued to advance its autonomous driving capabilities, expanding its already significant data centers and developing its humanoid robot Optimus. These investments increased confidence in the attractive growth opportunities that remain ahead.”
Overall, TSLA ranks 4th on our list of stocks on Jim Cramer’s radar right now. While we acknowledge the potential of TSLA as an investment, 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 TSLA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure: None. This article is originally published at Insider Monkey.