Jim Cramer sees reasons to be more positive about stocks and gives these 2 names his stamp of approval

Dissatisfied with the state of the portfolio after the miserable stock market action of 2022? You are probably far from alone. Most investors have struggled to make headway in the ongoing bear market this year, which has provided only brief periods of relief.

That said, with the end of the year drawing ever closer, well-known host of CNBC’s “Mad Money” Jim Cramer thinks the bears are showing signs of exhaustion and that’s good news for battered investors.

“You have to adjust your mindset to a world where the bears are finally in retreat, because I bet the next four weeks are going to be much better than we’re used to,” Cramer said.

With that in mind, let’s take a closer look at two stocks that recently received Cramer’s endorsement in his “lightning bolt” segment. According to the TipRanks database, Cramer isn’t alone in thinking these tickers are ripe for the picking; both are classified as Strong Buys by analyst consensus. Here are the details.

MP Materials (deputy)

The first name we’ll look at is a “winner,” according to Cramer. MP Materials is a North American-based rare earth miner. Its deposit-rich Mountain Pass mine in California is the largest rare earth mine and processing plant in the United States, providing the company with an approximately 15 percent global market share in upstream rare earth production.

Its production focuses primarily on neodymium-praseodymium (NdPr), a rare earth element used in high-strength permanent magnets that drive traction motors used in electric vehicles, drones, wind turbines, robotics and other technologies of cutting-edge movement.

Being able to produce much-needed components used in segments gaining adoption should be a recipe for success, and the company built on the rising realized price of rare earth oxide in its latest earnings report — for the third quarter.

Despite the COVID-19 lockdowns in China and global economic headwinds, which caused NdPr prices to drop sequentially, average prices have increased significantly year-over-year, underscoring the ongoing strong demand for NdPr.

Revenue increased 24.8% year over year to $124.45 million, beating Street’s call by $6.73 million. The increase in revenues resulted in a 34% year-over-year increase in Adjusted EBITDA to $91.4 million. Consequently, the adj. EPS of $0.36 also beat Street’s forecast of $0.30.

So, Cramer thinks MP is a “winner” and so is BMO analyst Robin Fiedler.

“MP is a rare earth pureplay with a tier-one asset amidst scarce alternatives. We view MP’s unique and multi-faceted vertical integration growth and Chinese supply chain avoidance strategy as compelling and therefore able to bear expansion and price risks in the near term,” the analyst said. that at current levels the risk-reward ratio is attractive considering our assessment of the uptick in vertical integration over the medium to long term and the potential for various legislative ‘victories’ next year.”

As a result, Fiedler rates MP as sharing an Outperform (aka Buy) while his $50 price target leaves room for 12-month gains of 53%. (To look at Fiedler’s track record, Click here)

Fiedler’s view of MP is bullish, and he is far from the only bull on the stock. MP has 7 recent analyst reviews, with 6 buys and 1 holds for a strong buy consensus rating. The shares are priced at $32.68, and their $44.93 average price target implies about 37% one-year upside potential. (See MP Material Inventory Forecast on TipRanks)

ICON plc (ICLR extension)

“I like it. It’s a very cheap stock. That’s Cramer’s short, succinct explanation to back the next company we look at.

Icon is a big name in the world of clinical research organizations (CROs). That is, the company helps pharmaceutical, biotech, and other research labs do their job. It is one of the biggest names in the industry offering services across the board. These include everything from strategic development, program analysis and compound selection assistance, patient recruitment and retention, site monitoring and data management, among others.

Icon has gone through some big changes in the last year and a half. In July 2021, the company completed its acquisition of contract research firm PRA Health Sciences in a deal valued at approximately $12 billion, creating what it calls “the world’s most advanced health intelligence and clinical research organization “.

On the financial front, Icon’s latest statement has been a success. In its third-quarter report, the company generated $1.94 billion in revenue, exceeding Street’s expectations by $10 million. Similarly, EPS of $1.94 beats the analyst forecast of $1.82. The company also reaffirmed its full-year 2022 revenue and adj. EPS help.

Evaluating the third-quarter print, JP Morgan analyst Casey Woodring believes the long-term case remains “intact,” while emphasizing the importance of the FRAH deal.

“We are encouraged by how the company performed in 2022 and view the reiteration of LT targets through 2025 as a positive indicator of overall market health and ICLR’s competitive positioning,” the analyst wrote. “We continue to see ICLR as a top-tier clinical CRO with a compelling financial profile that is most leveraged for large pharma during this period of little biotech uncertainty along with the upside potential from new corporate wins as a result of company size and the integrated capabilities of the PRAH business.

These comments underpin Woodring’s Overweight (aka Buy) rating, backed by a $265 price target. The implications for investors? About 22% upside from current levels. (To look at Woodring’s track record, Click here)

Overall, ICON gets solid support from Street; ratings drop from 7 to 2 in favor of buys over holds and culminate in a Strong Buy consensus rating. The average goal is slightly less than Woodring’s goal; at $259, the figure suggests a one-year upside potential of ~20%. (See ICLR stock predictions on TipRanks)

To find good ideas for trading stocks at attractive valuations, visit TipRanks’ best stocks to buy, a recently launched tool that brings together all of TipRanks’ stock information.

Disclaimer: The views expressed in this article are solely those of the analysts featured. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

Leave a Reply

%d bloggers like this: