This stock market is making people feel trapped, Jim Cramer told his Mad Money viewers Wednesday, but now’s not the time to sell everything. That’s because no one ever made a dime panicking and not every sector is in bear market mode.
Cramer reiterated his advice that if you invest in companies that make things, sell them at a profit and return some of those profits to shareholders, you’ll do just fine. Sure, technology stocks aren’t working, but other sectors, like consumer stocks, drug stocks and the insurers, are still worth owning.
How can Cramer be so bullish? First, he said there’s no significant systemic risks to the market, as there was in the financial collapse of 2008. Next, while stocks are going down in value, there’s still value there, especially in the long term. Investors should feel grateful for what they own. Lastly, very few investors are nimble enough to sell stocks and get back in at lower levels. That means the best strategy is often to sit tight and wait out the decline.
People that tell you to sell everything in times like these are wrong, Cramer concluded. There’s still value in what you own and value in sticking to your convictions.
A Hidden Gem in the S&P 500
Looking for a hidden gem in the S&P 500 that no one knows about? There is one company in the S&P without any analyst coverage, and it represents a lot of value.
That company is Loews Corp. (L) – Get Loews Corporation Report, not to be confused with Lowe’s Cos. (LOW) – Get Lowe’s Companies, Inc. Report, the home improvement retailer. This Loews is a conglomerate made up of four components: insurance, natural gas pipelines, hotels and packaging. And while it doesn’t seem like these four businesses belong together, all four of them are in bull market mode.
This is a terrific set of assets for this environment, Cramer said. The company owns a stake in CNA Financial (CNA) – Get CNA Financial Corporation Report, which is a fantastic insurance company that trades at just 11 times earnings. Natural gas is a highly valuable commodity to combat Russia, and Loews has pipelines in all the right places.
Loews Hotels are also perfect for a world that’s anxious to get back to travel. And the company’s Altium Ltd. (ALU) packaging business is also seeing big profits.
Despite four great businesses, Loews doesn’t get credit for any of them, Cramer concluded. No matter how you value the company, whether via sum of the parts, book value, …….