Keep an eye on these 9 beaten-down retail stocks, Jim Cramer says

CNBC’s Jim Cramer on Friday offered a list of nine discounted retail stocks that he believes could be great additions to investors’ portfolios.

“Today we saw many of these discounted retailers rally nicely, but it will take many more days like today before these stocks come close to being expensive again. So, I would give any one of these a look,” the “Mad Money” host said.

Cramer’s comments come after the Dow Jones Industrial Average on Friday inched up 0.4% while the S&P 500 declined 0.27%. The Nasdaq Composite dropped 1.34%.

To come up with the list of retail stocks, Cramer started with a list of every retailer in the S&P 500, the S&P Mid-Cap 400 and the S&P Small Cap 600 before taking out every company with a market cap below $1 billion. 

Then, he took out the names with stocks selling for more than 10 times earnings, and also gave the boot to GameStop and Bed Bath & Beyond because they have no price to earnings multiple and are expected to lose money this year.

Cramer then whittled down the list even further to companies that meet the following criteria:

  • Does not have a debt to EBITDA ratio over three
  • Does not have an earnings forecast this year that is down more than 20% from last year
  • Did not miss the numbers when reporting their first quarter results
  • Does not have a dividend yield under 1%

Here is the list of nine retail companies that fit the bill:

  1. Macy’s
  2. Signet Jewelers
  3. Buckle
  4. American Eagle Outfitters
  5. Dick’s Sporting Goods
  6. Kohl’s
  7. Williams-Sonoma
  8. Bath & Body Works
  9. Best Buy

Disclosure: Cramer’s Charitable Trust owns shares of American Eagle Outfitters.

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Sophie Tremblay

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