Jim Cramer Says Tesla (TSLA) Is No Longer Constrained by the P/E Multiple

On By Littum

We recently published a list of Jim Cramer’s latest call before 2025 begins: Top 10 stocks. In this article, we’ll take a look at where Tesla Inc (NASDAQ:TSLA) stacks up against other stocks in Jim Cramer’s latest call before 2025 begins.

Jim Cramer spoke on a recent program about the market reaction to the Federal Reserve’s latest rate cut and its guidance suggesting fewer rate cuts going forward.

“I guess you could say the baby was thrown out with the bath water. It was really ugly, a little unexpected, and yes, vicious. While the market is hardly oversold, we may not get the quick snapback that we normally expect in a deeply oversold market,” Cramer said.

Jim Cramer said Jerome Powell’s comments and tone were “stern” and his conference call “confused” investors. Cramer said inflation has not fallen enough, making the Fed’s job difficult.

Cramer then talked about various sectors and companies that need interest rate cuts in the midst of a downturn.

“I really wish the Fed had not been so defensive about the need to cut rates going forward. A slower approach would have been much better. If they had expressly taken a wait-and-see approach before this meeting, we would be in a better position .This time they telegraphed the wrong thing, hence today’s meltdown. But if the weaker part of the economy deteriorates further, the Fed still has room to cut. Here’s the bottom line: A former data-dependent Fed didn’t data-dependent today with his statements, and that’s what drove the market down. This happened despite the quarter-point interest rate cut – which is typically good news for stocks – but it turned out to be the exact opposite.”

READ ALSO: 7 best stocks to buy for the long term and 8 Cheap Jim Cramer Stocks to Invest In

For this article, we’ve looked at some recent programs by Jim Cramer and selected 11 stocks he talks about. With each company we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds are piling into? The reason is simple: our research has shown that we can outperform the market by mimicking the best stock picks of the best hedge funds. Our quarterly newsletter strategy selects 14 small- and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

Jim Cramer Says Tesla (TSLA) Is No Longer Constrained by the P/E Multiple
Jim Cramer Says Tesla (TSLA) Is No Longer Constrained by the P/E Multiple

Number of Hedge Fund Investors: 99

Jim Cramer discussed on a recent show why some stayed on the sidelines at Tesla Inc (NASDAQ:TSLA) and missed the post-election rally. Cramer cited slowing sales of electric cars, concerns about a possible clash between Musk and Trump down the road and headwinds in China as some of the reasons that forced many to doubt Tesla stock. However, Cramer believes that Tesla has become a stock that can continue to go higher, regardless of the state of its underlying business.