Jim Cramer Says These 5 ‘Old Tech’ Stocks Could Have a Big Year in 2022
CNBC’s Jim Cramer on Friday presented an investment case for five legacy tech companies that he says could post strong returns in 2022.
The host of “Mad Money” said the following actions correspond to his main theme for the year, which is to invest in profitable companies producing tangible goods: Apple, Cisco, IBM, Microsoft and Oracle.
âWhile most money-losing cloud-based software stocks are now banned, there are plenty of tech names that are doing real things and making real profits,â Cramer said, saying they can perform well despite the Federal Reserve’s tightening of monetary policy.
âWhat you want here are boring, mature companies, the kind that is often derisively referred to as ‘old tech’,â Cramer added. “I say with the new, and with the old.”
âEven with the stock running 34% last yearâ¦ it’s now down $ 10 from its early-week highs thanks to the tech meltdown. Every time you get an opportunity to purchase like this with Apple, you have to grab it. âCramer says.
Cramer said he believes Apple will benefit from pent-up demand consumers may unleash once supply chain issues have been resolved. The iPhone maker’s “monster” share buyback program is even more advantageous amid a tightening Fed, Cramer said.
Cisco shares have been strong since late November, Cramer said, as investors began to look past the company’s recent earnings reports.
âThe past two quarters haven’t been bad because of demand. We’re actually seeing an increase in corporate technology spending; the problem was the supply chain crisis,â said Cramer, who also touted the computer network company’s shift into software and recurring problems. accompanying income streams.
“[Cisco CEO Chuck Robbins] says things should start to turn in the second half of Cisco’s fiscal year, which begins in February. I tend to believe him because he’s a real straight shooter, âCramer said.
Cramer said he wouldn’t be surprised if IBM shares sell off when the company reports earnings in a few weeks, but he has a favorable view for the longer term.
âI still love IBM for two very simple reasons: it’s incredibly cheap, selling for 12 times the profit, and even after the Kindryl spin-off, they kept their pre-break dividend, which means the stock has a 4.9% return, âCramer said.
He also said he agreed with CEO Arvind Krishna’s “mission to unleash value at all costs”.
âThis one climbed around 51% last year, but thanks to the massive selling in the last few weeks, you get a really good buying opportunity here. The stock is down 10% from its highs. highs in late November. That usually doesn’t. happen, “Cramer said.” Microsoft is exactly the kind of tangible tech story that should work when the Fed starts to brake to stop the economy. “
Even after his breakthrough in 2021, Cramer said he still thinks Oracle shares are cheap. The enterprise software giant’s last quarter has been fantastic, Cramer said. However, the stock foregone any post-release gains it made, in part due to Wall Street’s backlash to Oracle is considering buying out electronic medical records company Cerner.
âThis is another case where the recent withdrawal gets you in at an incredible price,â Cramer said.
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Disclosure: Cramer’s charitable trust owns shares of Microsoft, Apple and Cisco.