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These Five Newly Public Stocks Could Be Great Additions to Your Portfolio, According to Jim Cramer

Scott Mlyn | CNBC
  • CNBC's Jim Cramer on Friday offered a list of five newly-public stocks he believes investors should add to his portfolio.
  • "If you're willing to be disciplined in your approach, you've got my permission to sift among the rubble of last year's IPOs and SPAC mergers," the "Mad Money" host said.

CNBC's Jim Cramer on Friday offered a list of five newly-public stocks he believes investors should add to his portfolio.

While he still sticks by his rule that buyers should stick to companies that turn profit and produce tangible things, "that's a big ask for a company that just came public," the "Mad Money" host said, adding that he was inspired by Renaissance Capital CEO Bill Smith's newsletter to examine IPOs.

"They're usually in growth mode, so it makes more sense for them to invest in their business than waste money on dividend payment," Cramer said, advising investors to look at these newer companies' free cash flow as an indicator of their ability to be profitable.

Cramer said he looked at traditional IPOs from 2021 and 2022, along with the 151 stocks in CNBC's Post SPAC index, to find companies that meet the following criteria:

  • Are large enough companies to be worth highlighting
  • Had positive free cash flow in 2021
  • Trading below 40 times its free cash flow
  • Not Chinese, Russian or Cypriot stocks that could be geopolitically risky to own

Using the above criteria, Cramer narrowed the list of traditional IPOS from 2021 and 2022, along with the 151 stocks in CNBC's post-SPAC index, to 380 larger stocks. He then cut out 42 where there wasn't sufficient data to conduct an analysis. Then, after identifying 125 stocks with positive free cash flow in 2021, and whittling down the list further, he landed on five stocks that could be buying opportunities for investors.

Here's the list:

  1. Hayward Holdings
  2. MarketWise
  3. Ryan Specialty Group Holdings
  4. Sovos Brands
  5. Vivid Seats

"If you're willing to be disciplined in your approach, you've got my permission to sift among the rubble of last year's IPOs and SPAC mergers," Cramer said.

Cramer previously in January highlighted 12 newly-minted stocks he believed could be profitable.

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