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Cramer uses Warren Buffett’s investing method to spot 5 long-term Dow winners

Warren Buffett always talks about investing in America for the long-term, and owning the best of the best stocks to generate more wealth.

Jim Cramer used the notion of long-term investing to take a look at the stocks that rallied the most, from the time when the Dow Jones industrial Average was at 10,000, to its latest level at 20,000.

He boiled it down to five winners that were totally achievable, and in some cases downright obvious.

"They are here because management has been terrific, innovation extraordinary and their attention to customer's superb. Those are difficult traits to erase even if [President] Donald Trump fails to get much done," the "Mad Money" host said.





Warren Buffett
Adam Jeffery | CNBC
Warren Buffett

The biggest winner since the Dow was at 10,000 was UnitedHealth, which has more than quadrupled in the last decade. There wasn't much competition, and UnitedHealth pulled out of the Obamacare when it realized it wasn't making money.

That move made it the only healthcare company worth owning right now, Cramer said, because it's not stuck in Obamacare if it goes away.

"It is the only healthcare Trump stock I know. I think it can go much higher," Cramer said.

Next was Home Depot, which has tripled in the last 10 years. It was able to pull off such strong numbers during the worst housing recession in history, which was nothing short of amazing to Cramer. It used the downturn to solidify its position in the market.

No. 3 was Apple, which has also more than tripled in the same period. This is what happens when a company has the best and most sought after product. When the stock was at $93, naysayers were convinced Apple's best days were behind it.

CEO Tim Cook came on "Mad Money" and told Cramer he disagreed and laid out a multi-year strategy. The stock is now at $121.

Visa was next on the list as the paper-to-plastic play in the payment space. While Cramer thinks there are years of growth ahead for the company, he is worried that its CEO Charlie Scharf just retired, making him less certain about Visa's future.

The last player was Disney, which aside from Apple is the most obvious stocks in the world to buy for Cramer. From its movies and theme parks, it has cornered the kid market. The stock has been down lately on worries about ESPN subscriptions.

"CEO Bob Iger has multiple levers, including selling ESPN if he has to — although I think that would be a big mistake — in order to keep generating the 266 percent return that Disney gave you from Dow 10,000 to 20,000," Cramer said.

All five of these stocks were integral to the Trump rally. Additionally, most will benefit from lower corporate taxes and repatriation of foreign assets, making them prime picks for Cramer as the market powers higher.


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