- CNBC’s Jim Cramer says Bernstein’s Costco downgrade is logical, but it only creates a buying opportunity for the stock.
- The “Mad Money” host gets insight into Expedia and the travel business in an interview with CEO Mark Okerstrom.
- Shares of Chipotle have been on fire in 2019 and Cramer thinks there’s more upside to CEO Brian Niccol’s turnaround strategy.
Don’t trust this bearish note — Costco is still a stock to own
Shoppers at a Costco Wholesale store in East Peoria, Illinois.
Daniel Acker | Bloomberg | Getty Images
CNBC’s on Thursday predicted a new bearish assessment of Costco will induce a buying opportunity in the stock.
Earlier that day an A.B. Bernstein analyst downgraded the equity to underperform from market perform, citing “too high” valuation and that investors are “overestimating” its growth prospects. The analyst Brandon Fletcher was also concerned that customers would shop elsewhere if the economy continues to slow down.
Shares of the membership warehouse club fell 1.57% during the session. Cramer called it “the first real price break” in Costco’s stock in the past year.
“The next time some analyst knocks down a best-of-breed stock with a cogent downgrade that’s focused on valuation, you need to take advantage of that best-of-breed-opportunity weakness and you need to do some buying,” said the “Mad Money” host, who ranks Costco among his so-called .
Expedia and the future of travel
Mark Okerstrom, CEO, Expedia Group
Scott Mlyn | CNBC
Expedia Group CEO Mark Okerstrom visited Cramer on Thursday and gave the host his thoughts about the strength of the consumer and what’s in store for the travel industry.
The company is behind Homeaway, Trivago and its namesake Expedia brand.
“You’ve got this secular shift from things to experiences that is buoying travel,” he said. “From what we can see, if you look at a global basis, travel is just going to continue to go up and up and up, and we’re absolutely thrilled to be at the center of it all.”
Chipotle has another leg in its bull run
Chipotle restaurant workers fill orders for customers in Miami, Florida.
Getty Images
As the calendar inches closer to the fourth quarter, Cramer said Chipotle Mexican Grill will be a top target on the market as money managers get ready to double down on the highest winners of 2019.
The stock has trounced the this year, outperforming the broad index about 92% to 20% year-to-date.
“Usually when hedge funds and mutual funds anoint … their favorite winners going into the fourth quarter, those stocks keep winning until the big boys take profits in January,” the host said.
Oil stocks are risky
Oil field workers on a rig in Tioga, North Dakota.
Ken Cedeno | Corbis | Getty Images
If your investment portfolio includes oil stocks, it is time to sell some of them, Cramer said.
“I would scale them back,” the stock market commentator advised.
If oil industry stocks “didn’t have a sustained move” this week after roughly was lost in a drone attack, then “I don’t know when it will,” Cramer said.
Cramer’s lighting round
In Cramer’s lighting round, the “Mad Money” host zips through his thoughts about callers’ stock questions of the day.
DocuSign: “Because it is the ultimate utility and I think that what happens, I’m not kidding, people use it and they love it and should’ve bought them. And I’ve got to tell you had Adobe bought them, I think the stock’d be flying. Adobe [is] actually coming down.”
Western Digital: “Why buy Western Digital when you can buy Micron, which I think has more game?”
: “I like renewable energy. I think it’s a good company.”
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