Cramer’s Take on the Newest S&P 500 Additions

On Monday, CNBC’s Jim Cramer discussed the latest companies set to join the S&P 500: Applovin, Robinhood, and Emcor Group. He mentioned that both Applovin and Robinhood are currently more appealing stocks, anticipating possible price increases, although a retreat isn’t out of the question. In contrast, he feels Emcor’s story is particularly intriguing, suggesting it’s worth a buy right now.

Last Friday, S&P Global announced these three firms would be added to the index on September 22. By the end of Monday’s trading, Applovin gained 11.59%, Robinhood rose by 15.83%, while Emcor Group slipped by 0.61%. Even though trading hasn’t officially begun for these additions, Cramer encouraged investors to act swiftly upon such announcements.

Applovin started as a platform connecting mobile game developers with advertisers but has evolved into a significant player in digital advertising. Cramer noted the stock has seen erratic trading since its 2021 launch, but recently, it reported substantial profits and nearly doubled its revenue over three years. He expressed enthusiasm for Applovin’s management, who have effectively expanded within the industry and speculated that its impending S&P 500 membership might attract investors looking for gains. He advised waiting for a dip to buy in.

Regarding Robinhood, Cramer described it as “reinventing a retail stock securities company” and praised its rapid growth into areas like options, cryptocurrency, retirement accounts, and credit cards. He remains optimistic as wealth transfers from baby boomers to younger generations continue. Like with Applovin, he suggests investors should be ready to buy if the stock dips.

Concerning Emcor Group, Cramer highlighted how its engineering and construction focus aligns with current industrial and energy infrastructure trends. Emcor has experienced growth thanks to the surge in demand for data centers. Analysts expect this momentum may continue, fueled by current policies. Cramer mentioned the stock is also worth considering at its current price point.

“Nothing is more favorable for stocks than being part of the leading index,” Cramer remarked. He added that numerous index funds must buy new additions like these, creating a demand influx.

Robinhood’s CFO Jason Warnick shared enthusiasm over their addition to the S&P 500, emphasizing their commitment to democratizing finance and highlighting the progress they’ve made.

Neither Applovin nor Emcor Group immediately commented on the developments.