The US stock market has been hit hard by President Donald Trump’s new tariffs, and the retaliation that followed from other countries.
Jim Cramer, the famous investor, is still convinced that there are great opportunities to buy stocks in the current market despite what he described as a “manufactured sale-off” during his latest briefing before the Investing club.
Home Depot, Nvidia and Amazon are three names that he recommends purchasing on the recent pullback.
Home Depot Inc (NYSE: HD)
Cramer recommends purchasing HD shares at a discount, as the home improvement retailer sources over half of its products from North America.
The former hedge fund manager believes that Home Depot’s stock will benefit from the lower interest rates.
Mortgage rates are currently at a six month low.
Jim Cramer says that, in this context, “Home Depot is a company that should be purchased, perhaps even aggressively.”
He added that the pent-up housing demand may also benefit HD stocks in the future. Home Depot shares are even more attractive at current levels because they come with a dividend yield of 2.56%.
Wall Street is in agreement with Cramer’s assessment of the home improvement retailer. Analysts’ consensus ‘overweight’ rating on HD comes along with a median target of $432. This translates into a more than 25 percent increase from current levels.
Nvidia Corp. (NASDAQ: NVDA).
China has already announced retaliatory duties on American goods. This will hurt Nvidia, as it has a significant revenue exposure in the world’s largest economy.
Jim Cramer still recommends buying NVDA on the weakening market, as he believes in the long-term potential of the company, especially its pivotal role in AI-driven industrial revolution.
Cramer believes that Nvidia’s cutting edge chips are central to AI advances, which he views as a transformative factor across industries.
His view of Nvidia stock is in line with Wall Street.
Analysts predict that despite a sharp drop in the AI stock, it will eventually recover to $173. This would indicate a gain of more than 85% from here.
Amazon.com Inc. (NASDAQ: AMZN).
Nearly half of the top 10000 sellers on Amazon’s US marketplace come from China.
The ecommerce giant also sources a number of the goods it sells in Beijing.
Mad Money host is still bullish on Amazon following the sell-off. This is partly because the stock trades at a very attractive valuation.
AMZN’s price-to-earnings ratio is currently around 30, which is significantly lower than its historical average of over 55.
Jim Cramer says that the multinational company is resilient to economic challenges because it has a robust model of business and diverse revenue streams.
Cramer’s opinion on AMZN shares, like those of the other names in this list, is in line with Wall Street analysts.
The average price target for the tech stock is currently around $267. This indicates a near 60% increase from here.
This post Jim Cramer lists top 3 stocks to purchase during market crash caused by Trump tariffs first appeared on The ICD
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