Nvidia headquarters in Santa Clara, California, on Tuesday, Feb. 23, 2021.
David Paul Morris | Bloomberg | Getty Images
CNBC’s Jim Cramer on Tuesday looked at some of the best-performing stocks of the second quarter as the latter half of 2021 gets under way.
In his review, he noted that just one out of the top five components in both the S&P 500 and Nasdaq Composite indexes was a reopening play.
Below are the “Mad Money” host’s takeaways on the top stocks of the second quarter. Price changes represent stock moves from the March 31 close through Wednesday, June 30:
Nvidia, up 49.85%
“This is a company with a hammerlock on artificial intelligence and graphics processors and it’s become our largest semiconductor company. The company has a $516 billion valuation, up from just $15 billion five years ago,” Cramer said.
“Nvidia caught fire … the last three months [given its] fantastic raised guidance and the increasing likelihood that the regulators around the world will allow it to acquire a company called Arm Holdings, the British chipmaker that makes central processing units for both cellphones and personal computers.”
Devon Energy, 33.59%
Cramer said CEO Rick Muncrief “understands that Wall Street is sick and tired of oil companies that spend beyond their means and are awful stewards of capital.”
“The new Devon has a variable dividend that gives you a huge yield when oil prices are high, like right now,” he added. “As long as crude stays above sixty bucks a barrel, we’re talking about a 7% yield here. No wonder people like this one for the second half, too.”
Pool Corp, 32.85%
“You might think Pool’s a weird fit for this list, … but you have to remember that the housing market’s on fire. [with] rising home values. People are much more likely to invest in their property, and that includes building a pool,” Cramer said. “As long as housing stays strong, I bet this stock does just fine.”
“Here’s a consulting company for everything related to enterprise technology, one that’s chiefly known, though, for its in-person conferences. Very much a pent-up demand story,” Cramer said.
“While the company picked up a lot of business during the pandemic, it’s clear that investors believe they’ll get a major boost in the second half as those conferences come back,” Cramer added. “That said, with the stock up 32% last quarter, I think the easy money already has been made. This one’s not for me.”
“Equifax shocked Wall Street with its much better than expected results and its more aggressive buyback. I think this could be a terrific second-half story,” Cramer said. “This might be the single, most unheralded financial technology play out there.”
“If you think Covid’s behind us, well then Moderna’s a sell. If you think the delta variant is just the beginning and we might need regular booster shots, maybe there’s more to it,” Cramer said.
“To me, the crucial test is whether or not Moderna can offer personalized cancer vaccines … in time to offset the decline in Covid sales,” he added. “I think the stock’s too high at this point because, even if they’re successful at cancer vaccines, the comparisons are so difficult because of how successful they were in Covid.”
Nvidia was the second-best performing stock on the Nasdaq in the second quarter. Cramer passed the stock over after discussing its position on the S&P 500’s best-performer list.
“People often link DocuSign to Zoom, two products that took the world by storm during the pandemic, but while Zoom is facing all sorts of new competition and might take a hit as business travel comes back,” Cramer said, “DocuSign’s gaining speed and offering new categories, like the agreement cloud.”
Idexx Laboratories, 29.07%
“While Idexx is perennially expensive — it currently trades at 80-times earnings — it typically justifies that valuation with fantastic results,” Cramer said. “Another 29% rally might be hard to repeat, but I think the company will surprise, indeed, in the second half.”
“With the stock up 28% last quarter, I think Intuit has a very good chance of continuing its winning ways, if only because the products keep getting better and better,” Cramer said. “If you don’t own a small business, I don’t think you understand how great these guys really are.”
Intuitive Surgical, 24.45%
“Intuitive Surgical rallied 24% last quarter because it has a gigantic replacement cycle and it still has a ton of room to take market share, given all the users for its incredible machine,” Cramer said.
Disclosure: Cramer’s charitable trust owns shares of Nvidia.
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