Yahoo Finance Is MasTec Inc (NYSE:MTZ) The Best Infrastructure Stock Pick of Jim Cramer?
We recently published a list titled Jim Cramer is Recommending These 10 Stocks in June. Since MasTec Inc (NYSE:MTZ) ranks 8th in the list, it deserves a deeper look.
Jim Cramer in a latest program talked about the effect of inflation on US consumers and discussed how it’s impacting the Haves and the Have Nots. Cramer said while everyone is feeling the “pinch of inflation,” the Have Nots are feeling a “heck of a lot more” than the Haves. Cramer said that the difference between these two classes of consumers is very important for investment portfolios. He complained that many retailers don’t even know their consumers and that’s why they have a totally different reading of the current economic situation and its effects on consumers. Cramer criticized those who aren’t careful about the differences between consumers and use “the consumer” as a blanket term.
Cramer talked about several retail companies and how they are directly feeling the effects of inflation as consumers cut back on spending. The CNBC host said that Americans are making tough choices because of rising prices but we usually don’t talk about it.
Jim Cramer said that many strategists demand several rate cuts because “they want stocks higher.”
“I want higher stock prices too but if we get multiple rate cuts and inflation comes roaring back, it’s the Have Nots that will get hurt.”
Jay Powell Is Worried About Tens of Millions of People With Almost Nothing in the Bank, Cramer Says
Jim Cramer said that while many people won’t be happy to see a strong jobs report (because that decreases the chances of rate cuts), they should keep in mind the tough situation the Federal Reserve is in.
“Jay Powell isn’t worried about those of us with big portfolios. He’s worried about the tens of millions of people with almost nothing in the bank.”
For this article we watched several latest programs of Jim Cramer aired recently and picked 10 stocks he’s bullish about and recommending investors to buy or hold. With each stock we have mentioned the number of hedge fund investors. 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).
MasTec Inc (NYSE:MTZ)
Number of Hedge Fund Investors: 42
Florida-based infrastructure engineering and construction company MasTec Inc (NYSE:MTZ) is one of the best Jim Cramer stock recommendations in June. When asked about the stock, Cramer said MasTec Inc (NYSE:MTZ) is a “great infrastructure play.” Cramer said that MasTec Inc (NYSE:MTZ) is making a comeback.
“People say it’s down and out. No! That is a very good company. Jose R. Mas (MasTec CEO) is doing a terrific job. We like MTZ,” Cramer added.
Wall Street analysts are starting to talk about the stock, too. They believe despite low pricing power, the broader economic slowdown won’t impact specialty builders like MasTec Inc (NYSE:MTZ). Last year MasTec Inc’s (NYSE:MTZ) revenue jumped 23% to $12.0 billion, compared to $9.8 billion for the prior year.
Over the past one year the stock has slipped 0.8%. Despite its strong performance this year, some believe MasTec Inc (NYSE:MTZ) is undervalued. While its forward P/E of 35 is higher than the industry average, based on Wall Street’s estimates of a 49.70% earnings growth this year and 46% growth next year, the stock could be an attractive choice for long-term investors. Average analyst estimate for the stock is $121.69, which presents an 11% upside potential.
FPA Queens Road Small Cap Value Fund stated the following regarding MasTec, Inc. (NYSE:MTZ) in its first quarter 2024 investor letter:
“MasTec, Inc. (NYSE:MTZ) is a contractor that builds and repairs infrastructure for telecoms, electric utilities, oil and gas pipelines and the clean energy industry. The company benefits from strong spending for 5G in telecom and government support (including the Infrastructure Investment and Jobs Act) for clean energy and the electrical grid.10 The Mas brothers have an impressive history of rolling up smaller players and growing earnings, most recently in the electrical and clean energy spaces. But we became uncomfortable with the low margins and competition in the electrical utility and clean energy businesses. On Aug 4, 2023, in its Q2 2023 earnings release, the company reduced guidance, and we began to exit our position, partially in Q3 2023 and fully by the end of Q4 2023.”
Overall, MasTec Inc (NYSE:MTZ) ranks 8th on Insider Monkey’s list of Jim Cramer is Recommending These 10 Stocks in June. You can visit Jim Cramer is Recommending These 10 Stocks in June to see other stocks in the list. While we acknowledge the potential of MasTec Inc (NYSE:MTZ), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MasTec Inc (NYSE:MTZ) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: Michael Burry Is Selling These Stocks and Jim Cramer is Recommending These Stocks.
Disclosure: None. This article is originally published at Insider Monkey.
