Cramer taps Eli Lilly as a new member of the 'Magnificent Seven' if Tesla earnings falter
CNBC's Jim Cramer on Monday suggested Tesla could lose its spot in the "Magnificent Seven" megacap stocks list.

He said he's waiting to see results from the electric vehicle giant's upcoming earnings report, but said Tesla may have hit a "growth pause," compared to its Big Tech peers that are still on the rise. If Tesla falls out of favor, he said he thinks pharmaceutical giant Eli Lilly is a solid contender to take the company's place.

The other members of the Magnificent Seven include Apple , Amazon , Alphabet , Meta , Nvidia and Microsoft .

"We're ready no matter what, but to ignore the decline of Tesla or the advance of Eli Lilly is to reject the facts," Cramer said. "There's a real challenge to Tesla's greatness. I don't see that going away anytime soon."

Tesla's stock is down nearly 16% so far in 2024, according to FactSet. Cramer said there's been a host of issues plaguing Tesla on Wall Street, including stiff competition from Chinese EV-makers, as well as possible saturation in the U.S. market. And the automotive industry seems to be reducing its focus on EVs. Hertz announced last week it would be selling roughly a third of its EVs, most of which are Teslas. In October, General Motors and Honda Motor scrapped their plans to jointly develop EVs in the face of slower-than-expected demand.

At nearly $600 billion, Eli Lilly leads the pharmaceutical industry in terms of market capitalization. Cramer cited investor Ken Langone, who said in December that Lilly is poised to be the first drug maker worth $1 trillion. Lilly is known for its diabetes and weight loss medication, which Cramer said may be the biggest drug in history.

"I say let's see what Tesla does. If it falters, we can keep things at a 'Super Six' level until Lilly reports on Feb. 6," he said. "If Tesla can somehow pull a rabbit it of a hat, maybe I'm premature in calling its magnificent demise."