Cramer reveals 5 undervalued stocks that are must-own heading into 2026

Famed investor Jim Cramer says investors shouldn’t feel boxed out of the market as the benchmark S&P 500 index continued to print higher highs in the second half of 2025. 

“Sometimes, it can feel like there’s nothing left to buy,” the former hedge fund manager agreed in a recent segment of Mad Money.

But with some digging, he’s convinced one can always find undervalued gems with above-average growth potential.

That said, following are the top five inexpensive stocks that Cramer recommends owning heading into 2026.

T-Mobile US Inc

Jim Cramer retains immense confidence in T-Mobile’s leadership, even as the company undergoes a top-level transition.

According to him, the telecom behemoth is strongly positioned to deliver value as its operational strength and network scale outweigh short-term uncertainty.

For investors seeking stability in a high-growth sector, T-Mobile stock remains a standout.

Wall Street also currently has a consensus “overweight” rating on TMUS shares.

Dollar Tree Inc

In the consumer space, Jim Cramer highlighted Dollar Tree stock as a compelling pick for value-conscious investors.

He praised the retailer’s decision to spin off its underperforming Family Dollar unit that he viewed as an overhang on DLTR shares.

With inflation still pressuring household budgets, the former hedge fund manager sees Dollar Tree benefiting from increased foot traffic and leaner operations.

Earlier this month, Dollar Tree posted better-than-expected financials for its fiscal Q2.

American Express Co

Cramer sees American Express as a financial stock with generational momentum.

“It seems to be popular with Millennials and Gen Z,” he said, noting the brand’s appeal among younger consumers.

As credit card usage remains strong and travel rebounds, AXP’s premium positioning and loyalty programs could drive outsized growth.

AMEX is particularly suitable for income-focused investors as it currently pays a dividend yield of nearly 1.0% as well.

Incyte Corp

Despite calling healthcare a “wasteland” this year, Cramer singled out biotech firm Incyte for its promising pipeline.

He believes the company’s research and development efforts could yield meaningful upside.

In a sector starved for investor enthusiasm, Incyte stands out to the Mad Money host as a rare bright spot with long-term potential.

Jim Cramer remains bullish on INCY shares even though they’re already up over 50% versus their April low.

Caterpillar Inc

Cramer’s top industrial pick is Caterpillar stock, which he dubbed a “machinery kingpin.”

He emphasized the company’s exposure to the data center buildout theme, suggesting it’s more than just a cyclical play.

With infrastructure spending and artificial intelligence (AI) driven demand on the rise, CAT shares offer both legacy strength and future-facing relevance.

A 1.28% dividend yield makes Caterpillar shares all the more attractive to own for the longer term.