Cramer: Here's how investors should be positioned after April's hot inflation data

Published Wed, May 12 202110:11 AM EDTUpdated Wed, May 12 202110:48 AM EDT

Kevin Stankiewicz @in/kevin-stankiewicz-b5593466 @kevin_stank

CNBC's Jim Cramer said Wednesday he was surprised some market participants were caught off guard by the latest reading for the consumer price index , which came in hotter than expected for the month of April. "Other than the highest-growth stocks … most stocks have been anticipating this," Cramer said on "Squawk Box." He said he continues to share Federal Reserve Chairman Jerome Powell 's view on inflation, seeing the current price pressures as transitory rather the beginning of sustained, problematic increases. "I'm in Jay's camp for a little bit more," Cramer said, while stressing that investors still need to position their portfolios to benefit from the current economic landscape. "We need to see some of these commodities peak, and they have not peaked. And as long as they haven't peaked, you can buy their stocks," Cramer said, pointing Freeport-McMoRan as one example. Shares of the copper mining company have soared more than 70% year to date and nearly 400% in the past 12 months. The stock's move coincides with the price of copper rallying to record highs . "I know that it seems weird that you can still buy Freeport," Cramer said, adding: "That's the nature of an inflationary cycle. You don't even have to think about it, which I know is terrible, but they just go up and up and up." "If the Fed is committed to its stance, then we're not done with these [inflation] numbers. It's the first of the really bad numbers," Cramer added later on CNBC. Because of that, the "Mad Money" host said investors should continue to avoid stocks that trade on price-to-sales multiples. "You do not pay times sales. You have to pay times earnings. You can't buy stocks that don't have buybacks. You must buy stocks with dividends," Cramer said, echoing a view espoused Tuesday by Jeremy Siegel of the Wharton School. The finance professor told CNBC investors should be looking for dividends when price increases are a concern because "fixed income is just not going to keep up with inflation." "All the history has shown that dividends on stocks do keep up with inflation, and that's another reason why I think the value trade will be a good trade in 2021," Siegel said on "Closing Bell." Earlier this week, Cramer discussed some other economically sensitive stocks that young investors should know . Included on that list were Cleveland-Cliffs , which produces steel and iron ore products; aluminum maker Alcoa ; and mining company Southern Copper . "When you get these periods, you're not thinking about Vizio . Palantir is not on your front burner," Cramer added Wednesday.

Jim Cramer

Scott Mlyn | CNBC

"Other than the highest-growth stocks … most stocks have been anticipating this," Cramer said on "Squawk Box."

He said he continues to share Federal Reserve Chairman Jerome Powell's view on inflation, seeing the current price pressures as transitory rather the beginning of sustained, problematic increases.

"I'm in Jay's camp for a little bit more," Cramer said, while stressing that investors still need to position their portfolios to benefit from the current economic landscape.