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CNBC’s Jim Cramer on Wednesday said that while headlines continue to swirl around the government shutdown, investors should be paying closer attention to the story the market just finished telling. However, he cautioned that the biggest gains of the year may have passed.
“You can tell an awful lot about a market by looking at the winners and losers of a quarter that was just put to bed,” Cramer said. “I think the third quarter’s winners are a terrific place to be. I’m betting most of these can keep rallying through the end of the year, but the biggest gains may, indeed, have already been made.”
Cramer contended that the third quarter’s top performers offer a valuable roadmap for the final stretch of the year — since many fund managers tend to buy those July-to-September winners in the fourth quarter to show their clients “they own the right stocks.”
Leading the charge was AppLovin, a mobile ad tech company that uses AI and analytics to help app developers drive monetization. The stock jumped 105% in the third quarter. Cramer explained that even though the stock isn’t a household name, many institutional investors are just beginning to take notice.
Western Digital and Seagate also posted massive gains — 87% and 63%, respectively — as data storage demand soared on the back of the AI boom. Cramer reflected on his own past as a Western Digital investor decades ago, saying, “It’s good to see the market giving the stock its due, even if it’s 30 years too late for me.”
Warner Bros. Discovery surged 70%, thanks to balance sheet improvements, a better box office and, crucially, speculation of a takeover from Paramount Skydance. Cramer said such a bid would front-run the company’s restructuring and could trigger a bidding war. Teradyne, up 53%, and a rebounding Intel, up nearly 50%, also made the list, with Cramer crediting Intel’s turnaround to new CEO Lip-Bu Tan and bold capital moves involving SoftBank, Nvidia, and U.S. government funding.
Even Invesco, the asset manager, made an appearance with a 45% gain, a nod to strong overall market performance.
As for Q3’s underperformers, Cramer saw little reason to go bottom fishing. He said Chipotle was the only candidate he thought could make a reversal but said to hold off on investing in managed care, cable, used cars or Invisalign braces.
