Insider Monkey

10 Cheap Jim Cramer Stocks to Buy Now

Omer Farooq
10 min read

In This Article:

In this article, we will discuss the 10 cheap stocks to buy now according to Jim Cramer. If you want to explore similar stocks, you can also take a look at 5 Cheap Jim Cramer Stocks to Buy Now.

"The Initial Move Is Almost Always A Head Fake"

On March 22, the Fed raised interest rates by 25 basis points, in-line with market consensus. On March 25, Mad Money host Jim Cramer weighed in on this move by the Fed and what he sees for the markets ahead. Cramer was expecting a quarter-point rate hike from the Fed, however, he thinks that the Fed "was a bit more hawkish" than he anticipated in light of the banking crisis. Cramer noted that though the Fed is suggesting moving interest rates higher than the current level, the Fed funds futures indicate 8 cuts by the back half of 2023.

Cramer pointed out an interesting pattern that the markets have followed over the past year after every FOMC meeting since March 2022. Cramer thinks that this pattern can be insightful and can potentially guide the direction of the market in the near-term. Cramer noted that before the March 2022 rate hike, the intraday average movement of the S&P 500 in either direction was 1.15%. He defined this as the baseline and pointed out that out of 9 times the Fed has raised interest rates, 7 times the S&P 500 exhibited a bigger move than its intraday average. Cramer's analysis shows that the initial 3-day move of the markets, after the Fed's rate hike, reverses in the following 3 months. This has held true for 7 out of 8 times over the Fed's hiking cycle, that began in March 2022. Cramer thinks that "the initial move is almost always a head fake".

While the pattern is noteworthy, Jim Cramer thinks that it is "dangerous to predict we're going to rally over the next 3 months", especially amid the banking crisis. The key takeaway for investors according to Cramer is that "the initial reaction of the Fed's rate hikes has been wrong, every time, over the past year".

We have compiled a list of the best cheap stocks to buy according to Jim Cramer. Some cheap stocks that Jim Cramer is recommending to buy right now include Devon Energy Corporation (NYSE:DVN), Nucor Corporation (NYSE:NUE), and Stellantis N.V. (NYSE:STLA).

10 Cheap Jim Cramer Stocks to Buy Now
10 Cheap Jim Cramer Stocks to Buy Now

Our Methodology

To come up with the best cheap stocks to buy now according to Jim Cramer, we watched Mad Money episodes aired over the past 2 weeks. We noted down every stock Jim Cramer recommended buying and sourced their trailing twelve-month price-to-earnings ratios from Yahoo Finance. We narrowed down our selection to stocks that had a TTM PE ratio of less than 15, as of March 28, and listed them in descending order of this metric. We have also mentioned the hedge fund sentiment for each stock, which was sourced from Insider Monkey's proprietary database of over 900 elite money managers.

and

Recommended Stories