• CNBC’s Jim Cramer on Thursday cited sectors that have seen big gains recently and warned investors not to buy them while they’re hot.
• “We have a lot of overvalued stocks in this market right now,” he said. “But a lot of them deserve love, just not on this level.”

CNBC Jim Cramer Thursday suggested the post-election market had been extreme, with big wins and big losses. He cited sectors that have seen big gains recently, explaining why they may have roared – but he warned they needed to calm down before investors would consider buying them.

“We have a lot of overvalued stocks in this market right now,” he said. “But a lot of them deserve love, just not on this level.”

Cramer highlighted the sharp rise in enterprise software stocks, saying it seems like these companies offering products that are in high demand by big business can do no wrong. He named Sales force, ServiceNow, working day, Data Dog And Atlassian. He also suggested that most of these companies would be relatively unscathed by trade problems with China that could erupt under the current administration of Donald Trump, which places a premium on stocks. Still, Cramer is wary of “parabolic moves” in stocks.

The market also seems to like companies offering subscription models, he said, nodding to Costco, Netflix, Spotify And Amazon with their recurring revenue streams. Another booming sector is banking, Cramer noted, adding that these measures are entirely justifiable as investors anticipate a looser regulatory environment when Trump takes office.

Cramer also highlighted two sectors that he says are “too hated” but could rebound, including pharmaceuticals and semiconductors. Both Merck And Pfizer are producing promising drugs, he said. Pfizer could see its shares rise on any good news, he added. Cramer suggested concerns about the group were due to Trump’s controversial choice to lead the Health and Human Services Department – a vaccine skeptic. Robert F. Kennedy Jr. – could be largely priced into stock prices as they have already been hit hard.

For semiconductors, Cramer concluded that these companies have suffered in part because some believe that new PCs based on artificial intelligence have not taken off.

“For the group that seems to have fallen into a bottomless pit, call me interested, but only if we get a few days where they stop sinking and if we have more clarity from President-elect Trump, who is going to bring many stocks at the stake,” Cramer said. “We need to see the bottom of the abyss, unless, of course, we are already bouncing off it.”

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Disclaimer The CNBC Investing Club Charitable Trust owns shares of Salesforce, Costco and Amazon.

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