Stocks rose Wednesday as Federal Reserve Chairman Jerome Powell said a spike in inflation likely was temporary.
Katherine Ross spoke with TheStreet.com Founder Jim Cramer about the decision to sell Disney (DIS) – Get Report from the Action Alerts PLUS investing club portfolio and the future of automakers Ford (F) – Get Report and General Motors (GM) – Get Report.
Disney: Buy or Sell?
Cramer explained his decision to give up on Disney and other stocks, such as Campbell Soup (CPB) – Get Report and Take-Two Interactive (TTWO) – Get Report, that he said are “being viewed as pandemic plays.”
“I gave up,” he said. “I feel it’s become missionary work to stay long in these stocks.”
Cramer said that Disney did not present itself as an opening stock.
“They had been trying to get away from ESPN by talking about Disney+, And I think what got lost in the narrative is how great the theme parks are,” he said.
“I think people are paying less for the companies that are viewed as pandemic plays and more for the companies that are viewed as the great reopening trade.”
Ford, GM: Buy or Sell?
Cramer spoke highly of Ford, noting that he believed the semiconductor shortage that has weighed down the auto industry has ended.
Ford recently said its current-quarter earnings will exceed forecasts.
With the chip shortage ending, Cramer said “you’re going to see a flood of new supply.
“And if you see new supply, you’re going to see Ford stock go up nicely because they were slated to lose 2 billion without the chips and they will revert to them,” he said.
GM, which in May beat first-quarter forecasts, has come a long way under CEO Mary Barra’s efforts, Cramer said
The company has an incredible battery business “that it’s not getting credit for,” he said.
Last month, GM said it would restart production at some of its North American plants that it had idled as a result of the global semiconductor shortage.
Cramer added that he likes Ford CEO Jim Farley’s competitive nature against Tesla’s (TSLA) – Get Report Elon Musk.
“He said he’s going to bury Musk in the truck market and I’m with Farley,” he said. “This is the first time I ever felt that Musk can be beaten. Farley will beat Musk.”
Ford is a holding in Jim Cramer’s Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells F? Learn more now.