"Cramer has not implied that the tech rally is ending, but he does believe that the AI trade is "breaking up" as investors think more critically. Put another way, if you are doubting some AI stocks and you're paying too much for them right now, it's probably a good idea to take some profits and move them elsewhere. Having more exposure to recession-resistant stocks makes even more sense as AI-related tech stocks have ballooned to epic proportions."
"McDonald's came up during the "Lightning Round" segment of the show when a caller named John from Arkansas for Cramer's thoughts on McDonald's stock price and dividend . The caller specifically asked about these in relation to commodity issues, mentioning "mad cow, avian flu, swine flu, and fuel shortages." Cramer was very bullish and responded with his signature "Buy, buy, buy!" He gave two specific reasons for this optimism, with the first one being McDonald's mobile app."
"Cramer was very bullish and responded with his signature "Buy, buy, buy!" He gave two specific reasons for this optimism, with the first one being McDonald's mobile app. He noted that it constantly provides customers with "doorbuster ideas" and deals every day, which drives traffic and sales. The second is falling commodity costs. Addressing the caller's concern about commodities, Cramer argued that cattle prices have peaked. He stated, "I think it was a generational high and it's coming down.""
The AI trade appears to be "breaking up" as investors evaluate AI stocks more critically. Investors should consider taking profits on AI shares that appear overvalued and reallocating proceeds into recession-resistant names. AI-related tech stocks have surged and now represent a large share of major indexes. McDonald's earns a strong buy case based on its mobile app that offers daily deals and drives customer traffic and sales, and on falling commodity costs, particularly cattle prices that have likely peaked. Lower beef costs are expected to improve McDonald's profit margins. McDonald's functions as a defensive, recession-resistant stock.
Read at 24/7 Wall St.
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