Cramer began by talking about Amazon, which despite its dominance in the e-commerce industry, is down 28% year to date.
He believes that Amazon remains a growth stock, but for the company to increase its investor appeal, it needs to “take its medicine.”
“They got to cut back on warehouses that are no longer needed, cut back on workers who can get new jobs quickly if they let them go to this environment, and get more aggressive on the advertising side of retail while maintaining a big lead in the cloud with Amazon Web Services.”
Cramer points out that Amazon could earn $82 a share in 2024, but after taking those initiatives, that $82 of EPS in 2024 could become $100.
“And you're buying Amazon stock for close to market multiples in those numbers.”
Meta Platforms (FB)
Even mega-cap stocks can plunge violently.
Owning some of the largest social media and messaging apps in the world — Facebook, Instagram, WhatsApp, and Messenger — Meta is a tech gorilla commanding hundreds of billions of dollars of market cap.
Yet shares have fallen 44% year to date.
The company’s ambition in the metaverse was once considered a big catalyst for the stock. But that enthusiasm doesn’t seem to apply to today’s market as most metaverse-related stocks are deep in the red.
Cramer, however, continues to believe in the concept.
“The stock’s trading like the whole metaverse thing is just one big joke being played on Mark Zuckerberg, which seems pretty unlikely to me given his track record.”
Cramer adds that Zuckerberg is not alone in this endeavor. Some of the “smartest guys in the industry” like Nvidia’s co-founder and CEO Jensen Huang are betting big on the metaverse as well.
Note that Meta Platforms will start trading under a new ticker “META” on Jun. 9.
The third one on Cramer’s list of “colossal losers” is Google parent company Alphabet.
Despite being down 21% year to date, Alphabet is still a tech behemoth valued at $1.5 trillion.
Cramer likes Alphabet for a very simple reason: “Google remains the best way to advertise.”
In Q1, Google advertising brought in $54.7 billion of revenue, up 22.3% from a year ago. Revenue grew 23.0% year over year to $68.0 billion for the entire company.
While there have been some concerns about corporations’ ad spending in this economic climate, Cramer thinks Alphabet will be fine.
“We all know if you're cutting back on advertising, you're not cutting back on Google, you're cutting back on everything else,” he says. “Google is the way you move product that you can't move on Amazon or Instagram.”
Fine art as an investment
Stocks can be volatile, cryptos make big swings to either side, and even gold is not immune to the market’s ups and downs.
That’s why if you are looking for the ultimate hedge, it could be worthwhile to check out a real, but overlooked asset: fine art.
Contemporary artwork has outperformed the S&P 500 by a commanding 174% over the past 25 years, according to the Citi Global Art Market chart.
And it’s becoming a popular way to diversify because it’s a real physical asset with little correlation to the stock market.
On a scale of -1 to +1, with 0 representing no link at all, Citi found the correlation between contemporary art and the S&P 500 was just 0.12 during the past 25 years.
Earlier this year, Bank of America investment chief Michael Harnett singled out artwork as a sharp way to outperform over the next decade — due largely to the asset’s track record as an inflation hedge.
Investing in art by the likes of Banksy and Andy Warhol used to be an option only for the ultrarich. But with a new investing platform, you can invest in iconic artworks just like Jeff Bezos and Bill Gates do.