CNBC’s Jim Cramer said Thursday he sees a bull market in a number of sectors, including agriculture, even as Wall Street remains concerned about signs of a slowing economy.
“I think we just have a plethora of bull markets,” said the host of “Mad Money.” He added that investors “should be ready to buy into the weakness” as Wall Street is rocked Friday by Federal Reserve chairman Jerome Powell, who will give a much-anticipated speech at 10 a.m. ET.
“Another Fed-imposed meltdown could create great opportunities, but only if you know where to look,” Cramer said.
“There is a bull market of insane proportions happening in the agricultural sector,” Cramer argued Thursday, noting that Deere & Co. saw a number of price target increases from analysts after the company reported profits last week.
“I’m confident next year will be great for them,” Cramer said. “I’ve always loved the agricultural space because people need to eat, but there are times when farmers plant too much and the group does poorly. This isn’t one of those times, which is why Deere was able to unite on its so-called bad quarter, and why it got more price target increases in response than any other company I can remember this earnings season.”
Cramer also pointed to fertilizer companies like Mosaic, CF Industries and Nutrien. He noted that all three companies are still trading at single-digit P/E ratios, even after impressive gains so far. Seed company Corteva has “huge” pricing power, he added.
Cramer said auto parts are one of his long-term favorite areas. AutoZone, in particular, is the company he likes the most in the industry.
“This company had 30 million shares in 2016. Now it has less than 20 million shares. During this period, the market cap has grown from $21 billion to $43 billion. Now there is Advance Auto Parts, but it was missing last time. I want to get into the Zone,” Cramer said.
Aerospace and Defense
“It’s hard to say because of Boeing’s endless string of accidents, but there’s also a bull market in aerospace and defense,” Cramer said, pointing to Raytheon Technologies as a company to consider.
“This is a stock that seems almost chronically undervalued,” he said. “It’s up 12% this year — pretty good relative to the averages, but not that high compared to the strength of the end markets.”
Cramer said the recently passed Inflation Reduction Act — particularly clean energy facilities — should give a meaningful boost to the businesses of companies like Generac.
“Products produced by Generac can store solar energy and help you sell your energy back to the grid while also charging your electric vehicle,” Cramer said.
“I know the bill favors Plug Power for hydrogen vehicles, and it lowers the price so that the business is really viable here,” he added. “And I’m curious what the law can mean for Darling Ingredients, the ultimate recycler of all kinds of waste. After talking with them, I believe they also have a bright future.”
apply now for the CNBC Investing Club to track Jim Cramer’s every move in the market.