Cramer says the sell-off isn’t over for tech stocks that trade at high multiples of the sell-off: ‘Those got it’

Jim Cramer

Scott Mlyn | CNBC

It’s been a bloody few weeks for high-flying tech stocks and CNBC’s Jim Cramer thinks there’s still a little more carnage to be had for some parts of the market.

“Tomorrow you have to make sales…if you own stocks that are selling at a multiple of the sales…those who had it,” the “Mad Money” host said in a CNBC special report Monday night, following a volatile session for stocks.

Cramer is specifically referring to stocks trading at high valuations relative to the sale price that have little or no current earnings that have been bid up during the pandemic for their future earnings potential. Those names are now faltering in the face of a Federal Reserve pivot that could lead to higher rates. Cramer says you need to separate those stocks from companies that actually make products and sell services that generate profits today.

Major averages fell on Monday, recouping steep losses to finally close in the green. However, it has been a sea of ​​red for stocks this month, particularly the tech-focused Nasdaq Composite, which is in correction territory.

At one point on Monday, the index was only a few percentage points away from hitting a bear market.

Cramer used Lemonade and Cloudflare as examples of stocks he finds difficult to assess.

He said that only when a major software company buys one of these failing high-tech stocks would the bottom be for those kinds of names.

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