CNBC’s Jim Cramer on Thursday gave investors advice about “junior” growth stocks, or young companies that may be higher risk but have serious potential for higher reward.
Cramer refers to these small, fast-growing companies as “junior” growth stocks because they are perfect for young investors. As he told University of Miami students back in February, younger investors can afford to take more risks. While retirees might be wise to tread carefully when investing their life savings, young investors have plenty of time to correct their mistakes and wait for new companies to gain traction.
“Normally, we don’t spend a lot of time focusing on these higher-risk names,” Cramer said. “But tonight, I want to break form and give you the father-daughter-mother-son list, the stocks that might turn out to be huge eventually, assuming they turn out to be anything at all.”
Cramer ran through 10 junior growth names during Thursday’s episode, but here are three of his top picks:
Celsius’s year-to-date stock performance.
Celsius: Cramer called Celsius one of the most successful energy drinks of this generation. Founded in 2004, Celsius produces drinks, supplements and protein bars. In an earnings report released last week, the company showed record sales for the first quarter, up 95% year over year and up 46% from the previous quarter.
“I think Celsius could be the next Monster Beverage,” Cramer said, adding that PepsiCo has taken an 8.5% stake in the company, giving the drink manufacturer “the kind of pedigree we’re looking for.”
Dutch Bros’ year-to-date stock performance.
Dutch Bros.: The Oregon-based coffee chain Dutch Bros. piqued Cramer’s interest, and he is impressed with their “super-caffeinated” offerings. The company was founded in 1992 as a pushcart by the railroad tracks — and now the franchise boasts 671 shops across 14 states.
“Sometimes I worry that Dutch Bros. is growing too fast, spending too much to hit Texas hard and not making nearly as much money per unit as it could,” Cramer said. “I had my first one nearly a decade ago when my daughter lived in Ashland, Oregon. They called it the annihilator, downed it on a Saturday, didn’t sleep until Sunday night. My kind of elixir.”
On Holding’s year-to-date stock performance.
On Holding: Cramer called On Holding the fastest-growing sneaker company in the world. Launched in 2010, the Swiss company is backed by tennis champion Roger Federer and recently reported a 78% increase in revenue, exceeding consensus estimates.
“Seems like every other person is wearing these On sneakers,” Cramer said. “So no wonder it had 91% growth in the Americas. Hard to beat.”