Cramer: The Best Performers Show No Signs of Letting Up

 | Apr 10, 2017 | 6:00 AM EDT
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Some stocks just can't seem to be stopped. They fly under the radar screen and manage to tread higher on little news flow and not much publicity.

They tend to be in four groups: industrials, health care maintenance and devices, financial tech and anything insurance. These have been the best performers for ages, and they show no signs of letting up.

Let's start with the industrials. Cummins (CMI) , Caterpillar (CAT) , Eaton (ETN) , Emerson (EMR) , FMC (FMC) , Fastenal (FAST) , Honeywell (HON) , Illinois Tool Works (ITW) , Ingersoll Rand (IR) , Nucor (NUE) , Rockwell Collins (COL) , Rockwell Automation (ROK) , Timken (TKR) , Trinity (TRN) and United Technologies (UTX) have dominated the new high lists or been close to it every time. They are all lacking in volatility. They used to be the most volatile stocks we saw in the market.

This is incredible, given how uneven the recovery in this country is. Now, you could argue they have all gotten strong since the Trump administration took office. But I would come back and say that, other than deregulation, there hasn't been that much good for any of these companies.

To me it's all about how much international business they have and how much better it has gotten. The year-over-year compares with just about every country on earth are far better than anyone thought, and while the U.S. wasn't weak it really didn't matter. Their overseas business has been carrying them.

Think about it like this. If Trump were so important to their fortunes, then why didn't they fall down on the failure to get health care repealed and replaced -- the first sign that Congress was not capable of following up on its own agenda? How are they going to do with lower taxes, all of which they would benefit from? As the infighting increases in Congress, the odds diminish.

Yet this isn't some unknown. The inability of Washington to get it done is right in our faces. But the stocks don't go down. To me, that's a sign that it's overseas that's pulling the train, because of the year-over-year comparisons. If we get tax relief, it is pure gravy.

Well before repeal and replace failed, stocks like Aetna (AET) and Cigna (CI) and Humana (HUM) and Anthem (ANTM) saw it all coming. As did UnitedHealth (UNH) . I think they knew that they would be in the catbird seat, no matter what. They would either get more incentives to write in the system, or they could leave and do even better. It was win-win as we saw from the leader, UnitedHealth, which had already pulled out.

These stocks are amazing.

So are the medical device companies. It's been such a no-brainer to own Baxter (BAX) , Bard (BCR) , Becton (BDX) , Boston Scientific (BSX) , Hologic (HOLX) , Intuitive Surgical (ISRG) and the like, that it's been painful. It's why I keep thinking that Medtronic (MDT) and Abbott (ABT) have to be good. Makes too much sense for them not to be, given that not all of these winners even have that good a record. Witness Hologic and Boston Scientific's ups and downs.

Then there's fintech. American Express (AXP) , MasterCard (MA) , Visa (V) , they just have such strong charts, especially vs. the banks, because they are the low-rate plays. They win because the banks lose.

And the insurers? I have been stymied all my life by these stocks. Chubb (CB) , Travelers (TRV) , Allstate (ALL) , Lincoln (LNC) , it really doesn't matter. They work. Those do fine in a deflationary environment and they have no excitement. They just go up.

Of course, hedge funds are drawn more to drama. They like the vastly underperforming AIG (AIG) , for example, as one that could get it together. They like Hartford Financial (HIG) because they think it can be taken over. But they aren't ever interested in global risk managers -- meaning insurance brokers -- Aon or Marsh & McLennan (MMC) . Just too boring? What is it about boring that we dislike so much?

Now, there are plenty of anomalies: stocks like Hershey's (HSY) and Unilever (UL) -- both doing better after takeovers. There's the cruise ships, for the experiential offerings. The defense stocks, obviously, where there are no sellers whatsoever. And the semi providers to Action Alerts PLUS charity portfolio holding Apple (AAPL) .

But for the most part, there are winners and losers in those groups. You want something without winners or losers? You can throw darts at those first groups. It's been like that for ages.

I think it's just going to continue. They are the best buys when we are down. They turn first, and I bet as we go into earnings season only the industrials might begin to bifurcate.

It's been easy pickings.

I think it continues.

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