In light of the statement made by the banking behemoth Barclays about its choice to lower the retail sector to a ‘neutral’ status due to restricted gross margin and growth potential within the stock market, Jim Cramer provided a brief response.
The energetic host of ‘Mad Money’ and former hedge fund manager appeared to concur with Barclays’ assessment. In a post on X, he simply highlighted that there are only three retailers that are deemed worthwhile for investment during the summer of 2024: Amazon (NASDAQ: AMZN), Walmart (NYSE: WMT), and Costco (NASDAQ: COST)
Amazon (NASDAQ: AMZN)
Considering Amazon’s extensive presence in the contemporary world and its significant role in the ongoing artificial intelligence (AI) boom through the dominance of Amazon Web Services (AWS) in the cloud provider market, it’s not unexpected that Jim Cramer sees the company as one of the three retailers worth holding.
Additionally, with AMZN recently encountering some setbacks in the stock market, leading to a 17.08% drop in 30 days due to the widespread downturn in early August and the latest earnings report, August 7 could offer a favorable buying opportunity for investors, if Cramer’s optimistic forecast holds true.
Walmart (NYSE: WMT)
Walmart is another firm that Jim Cramer has consistently expressed positivity towards. In July, he suggested that WMT stock could soon join the ‘trillion dollar club,’ referring to companies with a market cap surpassing $1 trillion, and potentially becoming the first traditional retailer to evolve into an e-commerce behemoth.
Cramer’s favorable stance on Walmart shares seems justified given its position as a secure investment owing to its reliable and non-cyclical business model as a discount retailer. The company has been performing robustly in a rising market, hitting new record highs on multiple occasions in recent months and registering a 28.13% increase year-to-date (YTD) to its present price of $68.04.
Costco (NASDAQ: COST)
About a year after Jim Cramer proclaimed Costco as ‘one of the most outstanding retailers in history,’ the company has indeed justified the accolades in the stock market. Over the past 12 months, COST shares have climbed by 48.30% to their current price of $824.75.
In the current year, this retail titan has showcased remarkable performance, with a YTD surge of over 25% and swift recovery following the recent market downturn.
From a business perspective, Cramer has specifically praised Costco for maintaining equitable pricing amid economic uncertainty. He has even linked the decision to raise membership fees with alleviating inflation, regarding it as a favorable development for investors.
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