Tag: CHEAPEST

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A technician operating an automated semiconductor processing machine with laser accuracy.

Number of Hedge Fund Holders: 58

During the episode, Cramer expressed enthusiasm about Lam Research Corporation (NASDAQ:LRCX) and emphasized that the stock is cheap.

“That stock is so cheap. Oh, I wanna buy it. I wanna buy. We have so much semi in the Charitable Trust, but that stock is so, the cheapest I’ve seen in a long time. I really like LRCX.”

Lam Research (NASDAQ:LRCX) operates in the semiconductor sector and specializes in the design, manufacturing, marketing, refurbishment, and maintenance of equipment used in integrated circuit production. At the time of writing, the stock has a forward P/E of 21.60. In October 2024, Cramer pointed out that the company is not solely tied to ASML’s performance. He mentioned that the company has already disclosed its level of exposure to China and has made adjustments by reducing it. Given these factors, Cramer expressed that he would consider buying the stock.

Vltava Fund, an investment management company, noted in its Q4 2024 investor letter that Lam Research (NASDAQ:LRCX) is a market leader in plasma etching, thin film deposition platforms, photoresist systems, as well as wet and plasma-based cleaning products for individual wafers. The fund mentioned the company’s ROCE, capital allocation, and more as it said:

“In the quarter just ended, we added to the portfolio two new companies from the technology sector: Applied Materials and Lam Research Corporation (NASDAQ:LRCX). Both are in the same industry as is another of our investments that we have held for some time, KLA Corporation. This industry is termed semiconductor devices and materials. One chapter in Hidden Investment Treasures is devoted to investing in technology companies and, among other things, the controversy over what really constitutes a technology company. As investors, we try to view technology companies not according to the industry into which they are formally classified but by whether the technologies and technological processes used in the production of their products and services are an essential element in value creation or if they are a source of long-term, sustainable competitive advantage. Among the companies that are formally categorized as technology-based and fall into either the Information Technology or the Communications Services sector, we find some that can be said to be just that but also others for which this classification is at least debatable. Similarly, among companies that do not formally belong to these two sectors, we find many that clearly are built to a large extent on technology and base their market positions and competitiveness on it. In the cases of Applied Materials and Lam Research, there can be no doubt that these are technology companies not only as a formality but also in fact.

Overall, LRCX ranks 3rd on our list of stocks that stocks that Jim Cramer recently looked at. While we acknowledge the potential of LRCX as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LRCX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap

Disclosure: None. This article is originally published at Insider Monkey.