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Are these stocks too ‘dangerous’ to hold?

Monday, 29 Jul 2013 | 6:53 PM ET
No Huddle Offense: Are home builders shaky?
Monday, 29 Jul 2013 | 6:58 PM ET
Mad Money host Jim Cramer shares his final thoughts of the day.

(Click for video linked to a searchable transcript of this Mad Money segment)

They were a bet on the recovery. But a shift in dynamic makes Cramer extremely cautious.

"Despite the endless entreaties to stick with the home builders, I think it's dangerous to do so," said Cramer.

Although the Mad Money host is a long-term bull on the housing recovery, he thinks in the near term the path of least resistance for the group is probably lower. And the DR Horton conference call seemed to confirm his outlook.

To put it simply, they suggested higher mortgage rates pretty much stopped housing sales in their tracks," Cramer said.

JuSun | E+ | Getty Images

Although rates remain low relative to the historic average, they spiked recently and as a result they scared potential home buyers out of the market. "People got real sticker shock and decided to put their buys on hold. Or they canceled," Cramer said.

As the economy stands right now, Cramer thinks many Americans remain worried about jobs. Therefore, he thinks even modestly higher rates are enough to dissuade potential buyers from taking the plunge.

Again, DR Horton confirmed the outlook.

On the conference call, Cramer said the company noted that it anticipated slower demand for months to come. "Until Super Bowl Sunday," he said.

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In the stock market, Super Bowl Sunday is a lifetime away. Cramer isn't willing to wait and he doesn't think the Street will wait either.

"Nobody's going to hold on to these momentum stocks through Super Bowl Sunday. That's just too long to wait," he said. There are too many other places to make money before then.

Therefore, Cramer thinks over the next few months home builders are too dangerous to hold. "Especially since I believe, if anything, rates are going higher, not lower."

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

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