We recently compiled a list of the Jim Cramer's Game Plan This Week: 10 Stocks to Watch.In this article, we are going to take a look at where Macy’s, Inc. (NYSE:M) stands against the other stocks featured in Jim Cramer's game plan for this week.
Jim Cramer, the host of Mad Money, recently discussed the current state of the market, touching on various factors including upcoming earnings reports and new inflation data. Reflecting on the November jobs report, which came in largely as expected, Cramer noted:
“After basically in line November jobs report, better than October, but with the unemployment rate still ticking up to 4.2%, I don't think that does much to change the Federal Reserve's rate cut calculus.”
On Friday, Cramer remarked that the market had a relatively calm session, with the Dow dipping by 123 points, the S&P gaining 0.25%, and the NASDAQ climbing 0.81%. He emphasized that nothing about Friday’s action surprised him, and he maintained his expectation for a 25-basis point rate cut later this month. Cramer added that he still anticipates the Fed will go ahead with this move despite the recent data.
Looking ahead, Cramer highlighted Wednesday’s upcoming release of the Consumer Price Index (CPI), which he noted could play a crucial role in the Fed’s decision-making. With the Federal Reserve meeting in just two weeks, he cautioned that there will be chatter about the Fed’s decision to cut rates.
“All of us still see high prices when we go to the supermarket, right? So we shouldn't be surprised if the CPI comes in hot. At that point, why should the Fed really bother to cut? Be ready for that kind of chatter. Don't worry, they'll still cut.”
The following day, Thursday, will bring the release of the Producer Price Index (PPI), which Cramer pointed out is another important inflation measure. He again expressed concern that inflation needs to cool down in order to avoid complications. There has been ongoing speculation about whether the Fed could hesitate on rate cuts, which could derail the market’s expectations. Cramer remarked that if inflation remains elevated, the Fed might have no choice but to delay or even shelve rate cuts for next year.
“Bottom line: Look, I’m trying to get my arms around a market that takes up all sorts of crypto, lots of unprofitable companies, never too great a sign for those who want the Fed to cut repeatedly,” he said. “I want you to keep that in mind so you won’t be surprised if we get some overheated inflation numbers next week and the market gives up some of these extraordinary gains.”
Our Methodology
For this article, we compiled a list of 10 stocks that were discussed by Jim Cramer during the recent episode of Mad Money on December 6. We listed the stocks in ascending order of their hedge fund sentiment as of the third quarter, which was taken from Insider Monkey’s database of 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).
A customer in a store trying on fashionable apparel and accessories for purchase.
“We also have some corporate news that could help explain something that's been a real mystery, maybe to me, maybe to you. I'm talking about what happened, what went wrong at Macy's where an employee apparently had millions in delivery expenses hidden. Now shareholders are entitled to know what really happened here. I don't think the company's fully explained them at all, and we wanna know exactly before we pay any attention to the forecast. We got to understand what went wrong. We need answers about how someone got away with this and more important, does the company now have the systems to try to catch anything like this malfeasance? I don't know.”
Macy’s (NYSE:M) s is a well-established omnichannel retailer that offers a wide range of products, including apparel, accessories, cosmetics, home furnishings, and more, through its prominent brands: Macy’s, Bloomingdale’s, and bluemercury. While preparing its unaudited financial results, the company identified an issue related to delivery expenses within one of its accrual accounts.
An independent investigation revealed that a single employee responsible for accounting for small package delivery expenses had intentionally made incorrect accrual entries to conceal a significant portion of delivery expenses. These erroneous entries involved hiding approximately $132 million to $154 million in total delivery expenses from the fourth quarter of 2021 through the fiscal quarter ending on November 2, 2024.
Macy’s (NYSE:M) stated that there is "no indication" that these incorrect accounting entries had any effect on the company’s cash management or vendor payments, ensuring that no operational disruptions were caused by the issue. The company was scheduled to release its earnings report in November. The company announced that it will issue its fourth-quarter and full-year outlooks on December 11.
Overall M ranks 7th on our list of the stocks featured in Jim Cramer's game plan this week. While we acknowledge the potential of M 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 M but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
