Jim Cramer, the renowned host of CNBC’s “Mad Money,” recently shared insights on four high-quality stocks that he believes investors can acquire at discounted prices. Cramer then went out across all social media platforms, from Twitter to Facebook, Instagram. He stressed the necessity of strategic buying when markets are low. He further pointed to the fact that investors are afraid to purchase the best-quality stocks. Yet in the process, they increasingly risk missing big opportunities.
Cramer’s analysis stems from his belief that purchasing stocks when they are down minimizes the likelihood of investors starting with a bad cost basis. In his comments, he pointed to Costco, Home Depot, McDonald’s and Starbucks as poster children for investment.
Revenue generated from Costco’s recurring subscription business model gives it the ability to offer consistently low prices to consumers, which brings in more members and creates a flywheel effect. It’s Cramer’s favorite strategy because it puts Costco on the path toward genius and persistent long-term growth. He stated, “But what’s most important is that you aren’t buying these high-quality franchises anywhere near the top.”
When you talk about McDonald’s, you’re honest about the fact that investors may be scared off by trying to time their buys. Cramer advised caution, saying, “Does this mean we’ve caught the bottom in McDonald’s or Costco or Home Depot or Starbucks? Of course not. Nobody’s that good.” His remarks just go to show how counterintuitive stock market investments can be, even as timing is still everything.
Cramer had a good deal of confidence in Starbucks’ new CEO, Brian Niccol, who is widely recognized for pulling off the successful Chipotle turnaround. He explained that this type of leadership can be very favorable for Starbucks as the company finds itself facing its own stormy waters.
Amid discussions of Wall Street sentiments, Cramer remarked that some analysts believe there is never a good time to buy high-quality stocks. He pushed back against this narrative by urging investors to take the initiative. He advised against “chasing things on the way up” and selling on weakness, stressing the need for disciplined investing.
Investors anxious for further details may contact Jim Cramer at 1-800-743-CNBC. He looks forward to hearing from you with questions and conversations around responsive investment strategy!