Jim Cramer is the host of CNBC's Mad Money and co-founder of TheStreet.com. In 1987, Cramer started his own hedge fund and returned an average of 24% per year between 1987 and 2001. Cramer has also written six money management books.
George Soros is ranked No. 35 on Forbes' list of the world's wealthiest people, and became known as “the Man Who Broke the Bank of England” after making $1 billion in 1992. He earned his initial fortune through investments and currency speculation.
Here are 13 stocks Soros and Cramer both love:
Westport Innovations (WPRT): Cramer recommended this energy company for its leading role in the future of natural gas. Westport converts petroleum-fueled engines into those that can run on liquefied natural gas. They recently made a deal with General Motors (GM) to make light-duty natural gas vehicles and launched a co-marketing program with Royal Dutch Shell (RDS.A) to form the North American market for liquefied natural gas powered vehicles.
Because of the recent 19% run-up, Cramer is expecting a pullback, and recommends buying the stock when it happens.
Apple (AAPL): Cramer praised Apple as being an innovation machine and the best-run company in America. As leader of the mobile internet revolution, Cramer said listening to conference calls (to find out that Apple is short in the memory space, for instance) is a way to find other companies in the sector poised to benefit from Apple.
Cramer’s charitable trust owns Apple. To many investors’ solace, the stock hasn’t fallen as much as initially expected upon the news of Steve Jobs’ resignation. Apple is cheap relative to earnings, having a $357 billion market cap and trading at only 15 times earnings. Soros has nearly $100 Million in AAPL common stock and call options. Bill Miller of Legg Mason Capital Management has 2.3% of his portfolio in Apple.
FedEx (FDX): Cramer has often said that shipping and transportation stocks are a good barometer for measuring the pace of the economy. Being down 20% from its 52-week high, a viewer wanted to know how FedEx might perform as a short-term growth play for the holiday season. Cramer likes FedEx, but prefers United Parcel Service (UPS) (which his charitable trust owns) because it is trading very close to its 52-week low and offers 3.25% yield protection. FedEx has a $23.25 billion market cap, trades at 16 times earnings and yields 0.7%. Soros has nearly $70 million in FDX common stock and call options.
AT&T (T): Cramer likes AT&T for its strong yield protection in an uncertain market. Soros increased his position in the stock by 7% recently. AT&T is trying to get around the Justice Department’s bid to block its merger with rival T-Mobile. This telecom giant has a $163 billion market cap, trades at 8 times earnings and yields 6.25%. Soros has nearly $68 million in bullish T positions.
IBM Corp. (IBM): IBM offers integrated solutions to help businesses solve technological problems. The company has a $192.75 billion market cap, trades at 13 times earnings, and yields 1.9%. Soros initiated a brand new position in IBM during the second quarter. Louis Navellier of Navellier and Associates has 2.55% of his portfolio in IBM stock as well.
American Science and Engineering (ASEI): This company works within the prevention and protection area of homeland security and produces X-ray scanners in a variety of formats. Cramer gives this stock a buy recommendation, but only when it goes lower in order, to get a good entry point. ASEI currently trades at 13 times earnings and yields 1.875%.
Potash (POT): Playing the theme of a global food shortage, Cramer recommended the best of the fertilizer companies under the assumption that a rising middle class around the world will increase the demand for chickens, cows, etc., which all feed on grain. Cramer recommended buying on a pullback. Mohnish Pabrai has a 19% position in the stock. Soros increased his POT position by 47% during the second quarter.
USB Bancorp (USB): Although Cramer hasn’t been a fan of financial stocks, his charitable trust owns USB Bancorp. It’s one of the few financials offering any yield, let alone 2.25%. The bank has a $42.25 billion market cap and trades at 10.7 times earnings. Soros initiated a brand new position in USB during the second quarter.
Caterpillar (CAT): Cramer gave a buy recommendation to Caterpillar, especially if the stock were to tick lower. United Rentals (URI) is a CAT distributor that has reported selling out of the equipment last month. Ken Fisher’s Fisher Asset Management has a particularly large holding of Caterpillar stock.
Cramer said CAT was one of the most “bedraggled” stocks to own in this market, as he thinks it’s incredibly cheap. Caterpillar is trading at 14 times earnings and generating 6.05 earnings per share. Soros initiated a brand new position during the second quarter.
Altria (MO): As one of the highest-yielding stocks on the Nasdaq, Cramer approved the ownership of this tobacco holding company. Soros initiated a small, brand-new position in MO during the second quarter.
Amazon (AMZN): A viewer asked Cramer during Mad Mail if Amazon was considered a true tech company. Cramer replied that it is more than just a tech company. It is a retail stock; the world’s largest, in fact. Cramer highly recommends the growth stock.
This mega retailer has successfully forged forward in the mobile internet space with its Kindle e-Reader. The company has a $98 billion market cap and trades at 93 times earnings. Louis Navellier of Navellier and Associates reduced his position by 5%. Soros cut his AMZN holdings by 96% during the second quarter.
Express Scripts (ESRX): Express Scripts is eyeing a merger with Medco Health and its projected completion is in the beginning of 2012. The pharmaceutical company has a $21.3 billion market cap and trades at 18 times earnings. Steven Cohen of Sac Capital Advisors reduced his position by 15%.
Oracle (ORCL): This tech stock dominates the enterprise market and has just received mixed reviews from a number of financial firms. While RBC Capital downgraded it, Credit Agricole and FBR both upgraded it. RBC was worried about the company’s combined hardware and software strategy as well as competitors taking away market share. Cramer thought they overlooked the biggest concern, which is the chance of slashed corporate IT budgets if the global economy continues to slow down.
For a tech company to be a good buy in this market, Cramer said they need to have exposure to strong end markets, high returns and a strong balance sheet. Oracle has all three. In addition, they have new products that will help the firm take market share and gain double-digit growth. Even in this market, it still managed to deliver 17% earnings growth. The stock is relatively cheap, trading at 11 times forward earnings. Soros has a very small position in this software giant.