Jim Cramer's Rate Test: Why He Backs Reddit but Passes on SiTime

CNBC host Jim Cramer backed Reddit (RDDT) and Rocket Lab (RKLB) but passed on SiTime (SITM) on Thursday’s “Mad Money,” favoring stocks that have fallen over those priced for growth while interest rates climb.

The picks span social media, rockets, refiners and chips, yet one thread links them. The Federal Reserve (Fed) raised rates in September, and Cramer leaned toward stocks that had already sold off.

Does a Sell-Off Make Reddit and Rocket Lab Worth Owning?

Cramer said he wants to buy Reddit after its slide this year. In contrast, one caller said investors punished lost, unprofitable Google traffic and ignored Reddit’s earnings from direct users.

However, CEO Steve Huffman called Google search referrals choppy in July, even as revenue grew 61%.

On Rocket Lab, Cramer said the failure to launch hurt the stock less than he expected. On Wednesday, Rocket Lab delayed the debut of Neutron, its medium-lift rocket, to 2027, Bloomberg reported.

Meanwhile, Rocket Lab reported a record $2.36 billion backlog in the second quarter, up 137% year over year. However, it has yet to turn a profit, and Neutron anchors that plan.

Where Does Oil Risk Sit in Cramer’s Energy Calls?

Cramer prefers Chevron to Exxon, unless taxes complicate a swap. He told a caller Enterprise Products Partners earns from natural gas liquids, such as ethane and propane, not oil.

Cramer called Valero (VLO) a binary bet on the crack spread, the gap between crude costs and refined fuel prices. He tied the spread to the Iran war.

On SiTime, which makes silicon timing chips, he drew the clearest line.

“It’s expensive, and I’m not recommending expensive stocks in tech or out of tech.”

Jim Cramer, host of CNBC’s “Mad Money,” CNBC

If the Fed keeps hiking, the same valuation test could reach crypto. Grayscale’s rate hike outlook argues that higher rates hit assets unevenly.

The Fed meets Oct. 27-28, and futures price about a 27% chance of another hike.