What Jim Cramer Says Now About These 3 Stocks Up More Than 200% YTD

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Recently, CNBC Mad Money host Jim Cramer reviewed a few stocks that have soared sky-high this year. Cramer stated that while investors may have dismissed these stocks as speculative, they were actually smart investments. While he adds he's not recommending them at current “frothy” levels, he said, "These names are often the epitome of speculating wisely, which can be the key for terrific long-term performance — of course, only when melded with index funds."

Out of the 10 stocks Cramer reviewed, the three we are discussing today are Palantir Technologies , AppLovin Corporation , and AST Spacemobile . So far this year, Palantir stock has soared 257.3%, AppLovin has gained a mind-blowing 748%, and AST stock has gained 305%, compared to the S&P 500 Index's gain of 23.6%.

Given the massive rally, some investors may believe they missed out on these growth stocks. However, there is a lot more room for these three to grow, which could be rewarding for long-term investors.

#1. Palantir Technologies

Valued at $138.4 billion, Palantir Technologies is known for its data analytics and AIP, or Artificial Intelligence Platform, which serves both the commercial and government sectors. Both its Palantir Gotham and Palantir Foundry platforms have generated significant demand in recent quarters, resulting in robust growth.

In the most recent third quarter, total revenue increased 30% year-over-year, while adjusted earnings rose 43% year-over-year, thanks to strong growth in both commercial and government revenue. Palantir's tools are deeply embedded in the U.S. defense, intelligence, and public health systems, generating a consistent revenue stream. Its recent multi-year deals with the U.S. Department of Defense and NATO are impressive. It is also risky, because Palantir's revenue is still primarily derived from a small number of government clients.

As a result, it has aggressively expanded into the commercial space, forming partnerships with companies in healthcare, manufacturing, and finance.

Analysts who follow the stock expect revenue to rise by 25.5% in 2024 and 24.1% in 2025. Earnings are expected to rise by 51% in 2024 and 24.7% in 2025. The stock is expensive, valued at 129.7x forward 2025 earnings and 43x forward sales.

Despite its high growth potential, analysts have a neutral outlook on PLTR stock. Currently, PLTR stock is not a “buy,” but rather a “hold” on Wall Street, with many skeptics citing concerns due to its overvaluation.

While bulls argue that the company's role in AI and potential for more commercial contracts warrant a higher valuation, bears remain cautious due to macroeconomic uncertainties.

Of the 15 analysts who cover PLTR, two recommend a "strong buy," six say it’s a "hold," two rate it a “moderate sell,” and five rate it as a “strong sell.” Palantir has surpassed both its mean price target price of $33.78 and the high estimate of $57.

I believe Palantir is well-positioned to capitalize on long-term trends in data analytics, AI adoption, and digital transformation. However, due to its overvaluation, it is best suited for those with a high risk tolerance.

#2. AppLovin Corporation

Valued at $107.7 billion, AppLovin Corporation is a key player in the mobile advertising and app monetization industry. Its robust software solutions and innovative advertising technology using AI have garnered significant attention from investors in 2024.

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The company operates through two segments. The software platform, AXON, uses machine learning to optimize ad placements and improve developers’ monetization. Thanks to the AXON models, the software segment contributed the most to total revenue in Q3, $835 million to be exact, an increase of 66% over the prior-year quarter.

The apps segment, which includes a portfolio of mobile games, grew 1% during the quarter. Total revenue increased 39% to $1.2 billion, while net income increased by 298.1% year-on-year to $434 million.

Analysts predict that Applovin's revenue and earnings will rise by 39.9% and 313.6%, respectively, in 2024. Revenue and earnings could further increase by 20.5% and 40% in 2025, respectively.

AppLovin's stock is expensive, trading at 56 times forward estimated earnings for 2025. AppLovin's strategic focus on AI-driven solutions, combined with its strong presence in the mobile gaming market, positions the company for long-term success. Given the stock's overvaluation, new investors may have to wait for a more favorable entry point. Other growth-oriented investors would be better off holding the stock right now.

Overall, Wall Street rates APP stock a “moderate buy.” Of the 19 analysts covering APP stock, 14 have rated it a “strong buy,” four suggest a "hold,” and one rates it a “strong sell.”

APP stock has surpassed its mean price target of $216.75. However, the stock could rally by another 16.5%, based on the high price estimate of $385.

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#3. AST Spacemobile

Valued at $7.04 billion, AST Spacemobile is working to provide broadband connectivity directly to standard mobile phones via its satellite network. Its mission is to build the first space-based cellular broadband network. Despite being unprofitable, ASTS continues to attract attention due to its innovative technology and strategic partnerships.

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The company's proprietary BlueWalker and BlueBird satellites are designed to communicate directly with mobile devices, allowing for seamless broadband coverage even in the most remote locations.

The recently reported Q3 loss of $1.10 per share was larger than expected. Nonetheless, this should not concern long-term investors, because it demonstrates the company's commitment to R&D, manufacturing, and deployment initiatives. Adjusted operating expenses totaled $45.3 million in the quarter.

While still in the pre-revenue stage, AST is on track with its launch services agreements to launch approximately 60 Block 2 BlueBird satellites in 2025 and 2026. AST's cash, cash equivalents, and restricted cash totaled $518.9 million at the end of the third quarter.

The global need for reliable mobile broadband is immense, with billions of people lacking consistent internet access, which makes AST an appealing long-term investment prospect. However, the company is still in its early stages. The high-risk nature of its operations and financial requirements necessitates careful consideration before buying the stock.

Overall, on Wall Street, the stock is a “strong buy.” Its mean price target of $43.67 suggests the stock can rally another 82.5% from current levels. Plus, analysts expect it to surge by 162.8% based on its high price estimate of $63.

On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

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Stocks Fall on Weakness in Retailers and Chip Makers

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The S&P 500 Index today is down -0.56%, the Dow Jones Industrials Index is down -0.12%, and the Nasdaq 100 Index is down -0.75%.

Stocks today are moderately lower ahead of quarterly earnings results from Nvidia after the close. Target is down more than -20%, leading retailers lower after cutting its full-year outlook due to flat sales and an inventory buildup. Also, technology stocks are under pressure today from weakness in chip stocks.

On the positive side, health insurance stocks are climbing today after RBC Capital Markets said the nomination of Mehmet Oz to lead the Centers for Medicare and Medicaid Services is a positive for the sector. Also, geopolitical tensions in Europe were ratcheted lower after Reuters reported that Russian President Putin is willing to talk with US President-elect Trump about a cease-fire deal in Ukraine that could roughly freeze the war along current front lines.

Comments today from Fed Governor Cook were neutral to slightly dovish when she said, "It likely will be appropriate to move the policy rate toward a more neutral stance over time," but the "magnitude and timing" of reductions will depend on incoming data and the economic outlook.

US MBA mortgage applications rose +1.7% in the week ended November 15, with the purchase mortgage sub-index up +2.0% and the refinancing mortgage sub-index +1.8%. The average 30-year fixed rate mortgage rose +4 bp to a 4-month high of 6.90% from 6.86% in the prior week.

The markets are eagerly awaiting quarterly earnings results from Nvidia after today’s close to see if the world’s most valuable company will show that strong spending for its AI hardware can continue. The consensus is for Nvidia to report record Q3 revenue of $33.25 billion and forecast Q4 revenue of $37.1 billion. Also, the consensus is for 2025 revenue of $126.58 billion.

Of the 90% of companies in the S&P 500 that have released Q3 earnings so far, 75% surpassed the estimates, slightly below the 3-year average. According to Bloomberg Intelligence, companies in the S&P 500 have reported an average +8.5% y/y increase in quarterly earnings in Q3, more than double the preseason forecast.

The markets are discounting the chances at 56% for a -25 bp rate cut at the December 17-18 FOMC meeting.

Overseas stock markets today are mixed. The Euro Stoxx 50 is down -0.14%. China's Shanghai Composite Index closed up +0.66%. Japan's Nikkei Stock 225 Index closed down -0.16%.

Interest Rates

December 10-year T-notes (ZNZ24) today are down -7 ticks. The 10-year T-note yield is up +1.2 bp to 4.408%. Dec T-notes today are moderately lower due to carryover pressure from weakness in European government bonds. Also, an easing of Ukraine-Russian tensions has curbed some safe-haven demand for T-notes after Reuters reported that Russian President Putin was willing to talk to US President-elect Trump about a cease-fire deal in Ukraine. In addition, supply pressures are weighing on T-notes as the Treasury will auction $16 billion of 20-year T-bonds this afternoon. T-notes recovered from their worst levels today’s stock slump sparked some short-covering in T-notes.

European government bond yields today are moving higher. The 10-year German bund yield is up +0.8 bp to 2.346%. The 10-year UK gilt yield is up +3.2 bp to 4.474%.

Eurozone Q3 negotiated pay rose +5.4% y/y, the largest increase since the euro was introduced in 1999.

UK Oct CPI rose +2.3% y/y, stronger than expectations of +2.2% y/y. UK Oct core CPI rose +3.3% y/y, stronger than expectations of +3.1% y/y.

Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its December 12 policy meeting and at 18% for a -50 bp rate cut at the same meeting.

US Stock Movers

Target is down more than -20% to lead losers in the S&P 500 and lead retailers lower after reporting Q3 comparable sales rose +0.3%, well below the consensus of +1.48%, and cut its 2025 adjusted EPS forecast to $8.30-$8.90 from a previous estimate of $9.00-$9.70, weaker than the consensus of $9.57. Also, Dollar General is down more than -4%, and Dollar Tree is down more than -3%. In addition, Costco Wholesale Is down more than -1%, and TJX Cos and Ross Stores are down at least -0.40%.

Qualcomm is down more than -5% to lead chip stocks lower after Susquehanna Financial cut its price target on the stock to $210 from $230. Also, Broadcom and GlobalFoundries are down more than -2%. In addition, Nvidia , ON Semiconductor , Advanced Micro Devices , Intel , ASML Holding NV , Microchip Technology , and Texas Instruments are down more than -1%.

Fabrinet is down more than -9% after B Riley Securities downgraded the stock to sell from neutral with a price target of $178.

XP Inc is down more than -5% after reporting Q3 revenue below expectations, and CFO Mansur said that equity markets will face more difficulties next year due to the macroeconomic situation.

Powell Industries is down more than -13% after reporting Q4 revenue of $275.1 million, weaker than the consensus of $284.3 million.

Palantir Technologies is down more than -2% after Jeffries said the company has an “unsustainable” multiple as it maintained its underperform rating on the stock with a price target of $28.

JPMorgan Chase is down more than -1% after Oppenheimer downgraded the stock to perform from outperform.

Keysight Technologies is up more than +5% to lead gainers in the S&P 500 after reporting Q4 revenue of $1.29 billion, better than the consensus of $1.26 billion, and forecast Q1 revenue of $1.27 billion-$1.29 billion, stronger than the consensus of $1.24 billion.

Health insurance stocks are climbing today after RBC Capital Markets said the nomination of Mehmet Oz to lead the Centers for Medicare and Medicaid Services is a positive for the sector. As a result, Humana is up more than +3%, and UnitedHealth Group is up more than +2% to lead gainers in the Dow Jones Industrials. Also, Molina Healthcare is up more than +2%, and Centene and CVS Health are up more than +1%.

Williams-Sonoma is up more than +27% after reporting Q3 adjusted EPS of $1.96, stronger than the consensus of $1.76.

Wix.com is up more than +13% after boosting its full-year revenue forecast to $.176 billion from a previous forecast of $1.75 billion-$1.76 billion.

Flex Ltd is up more than +8% after S&P Dow Jones Indices said the stock will replace Azenta in the S&P MidCap 400 effective November 27.

Newell Brands is up more than +3% after Barclays upgraded the stock to overweight from equal weight with a price target of $10.

AppLovin is up more than +2% after Piper Sandler initiated coverage on the stock with a recommendation of overweight and a price target of $400.

Earnings Reports (11/20/2024)

NVIDIA Corp (NVDA), Palo Alto Networks Inc (PANW), Snowflake Inc (SNOW), Target Corp (TGT), TJX Cos Inc/The (TJX), Williams-Sonoma Inc (WSM).

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

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Stocks Move Lower Ahead of Nvidia’s Earnings

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The S&P 500 Index today is down -0.39%, the Dow Jones Industrials Index is down -0.12%, and the Nasdaq 100 Index is down -0.59%.

Stocks today are moderately lower ahead of quarterly earnings results from Nvidia after the close. Target is down more than -21%, leading retailers lower after cutting its full-year outlook due to flat sales and an inventory buildup. Also, chip stocks are lower today and are weighing on technology stocks.

On the positive side, geopolitical tensions in Europe were ratcheted lower after Reuters reported that Russian President Putin is willing to talk with US President-elect Trump about a cease-fire deal in Ukraine that could roughly freeze the war along current front lines.

The markets are discounting the chances at 59% for a -25 bp rate cut at the December 17-18 FOMC meeting.

Overseas stock markets today are mixed. The Euro Stoxx 50 is up +0.19%. China's Shanghai Composite Index closed up +0.66%. Japan's Nikkei Stock 225 Index closed down -0.16%.

Interest Rates

December 10-year T-notes (ZNZ24) today are down -9 ticks. The 10-year T-note yield is up +2.6 bp to 4.422%. Dec T-notes today are moderately lower due to carryover pressure from weakness in European government bonds. Also, an easing of Ukraine-Russian tensions has curbed some safe-haven demand for T-notes after Reuters reported that Russian President Putin was willing to talk to US President-elect Trump about a cease-fire deal in Ukraine. In addition, supply pressures are weighing on T-notes as the Treasury will auction $16 billion of 20-year T-bonds this afternoon.

European government bond yields today are moving higher. The 10-year German bund yield is up +3.5 bp to 2.373%. The 10-year UK gilt yield is up +4.4 bp to 4.486%.

Eurozone Q3 negotiated pay rose +5.4% y/y, the largest increase since the euro was introduced in 1999.

UK Oct CPI rose +2.3% y/y, stronger than expectations of +2.2% y/y. UK Oct core CPI rose +3.3% y/y, stronger than expectations of +3.1% y/y.

Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its December 12 policy meeting and at 16% for a -50 bp rate cut at the same meeting.

US Stock Movers

Target is down more than -21% to lead losers in the S&P 500 and lead retailers lower after reporting Q3 comparable sales rose +0.3%, well below the consensus of +1.48%, and cut its 2025 adjusted EPS forecast to $8.30-$8.90 from a previous estimate of $9.00-$9.70, weaker than the consensus of $9.57. Also, Dollar Tree and Dollar General are down more than -3%. In addition, TJX Cos and Ross Stores are down more than -1%.

Qualcomm is down more than -4% to lead chip stocks lower after Susquehanna Financial cut its price target on the stock to $210 from $230. Also, Nvidia , ON Semiconductor , Advanced Micro Devices , Intel , ASML Holding NV , Microchip Technology , and Texas Instruments are down more than -1%.

Fabrinet is down more than -11% after B Riley Securities downgraded the stock to sell from neutral with a price target of $178.

XP Inc is down more than -6% after reporting Q3 revenue below expectations, and CFO Mansur said that equity markets will face more difficulties next year due to the macroeconomic situation.

Powell Industries is down more than -16% after reporting Q4 revenue of $275.1 million, weaker than the consensus of $284.3 million.

Palantir Technologies is down more than -1% after Jeffries said the company has an “unsustainable” multiple as it maintained its underperform rating on the stock with a price target of $28.

Williams-Sonoma is up more than +24% after reporting Q3 adjusted EPS of $1.96, stronger than the consensus of $1.76.

Wix.com is up more than +13% after boosting its full-year revenue forecast to $.176 billion from a previous forecast of $1.75 billion-$1.76 billion.

Flex Ltd is up more than +7% after S&P Dow Jones Indices said the stock will replace Azenta in the S&P MidCap 400 effective November 27.

Newell Brands is up more than +3% after Barclays upgraded the stock to overweight from equal weight with a price target of $10.

AppLovin is up more than +2% after Piper Sandler initiated coverage on the stock with a recommendation of overweight and a price target of $400.

Earnings Reports (11/20/2024)

NVIDIA Corp (NVDA), Palo Alto Networks Inc (PANW), Snowflake Inc (SNOW), Target Corp (TGT), TJX Cos Inc/The (TJX), Williams-Sonoma Inc (WSM).

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