CNBC’s Jim Cramer detailed his approach to investing in high-quality growth stocks, telling investors it’s vital to search for companies with an impressive track record.

“It’s only hard to find these hero stocks if you’re picking randomly,” he said. “For anyone with eyes to see, we’re talking about obvious winners that tend to keep winning for years and years.”

He reviewed some of the best performers of the past 20 years, namely megacaps placed into two groups, FAANG – Meta, formerly known as Facebook, Amazon, Apple, Netflix and Google – and the Magnificent Seven – Nvidia, Amazon, Alphabet, Apple, Meta, Microsoft and Tesla.

Cramer reviewed FAANG’s returns, noting that many outperformed the S&P 500 and saw double-digit gains over the past decade or so. These stocks were “hiding in plain sight,” he suggested, saying he’d been recommending them often over the years. Cramer stressed that he’s not advising investors to buy any stock that seems to be doing well, as most don’t have a solid pedigree and their gains are “often the product of an overenthusiastic public and greedy investment bankers trying to feed the maddening maw.”

He cited research from economist Hendrik Bessembinder, who looked at stocks’ performance from 1925 to 2023 and discovered that a very small number of individual stocks produce the bulk of the market’s gains. Bessembinder found that thousands of stocks did make money — but not necessarily enough to justify an investment versus an index fund — while 17 stocks delivered enormous returns, Cramer pointed out. These high-yielding stocks were relatively well-known companies, Cramer continued, including Boeing, IBM, Coca-Cola, Deere and Johnson & Johnson.

“I’m always hunting, not just for Amazon but for the next Amazon, or the next Netflix, or the next Nvidia. Once the Magnificent Seven lose their magnificence, then there are another seven out there, believe me, that are just waiting to be found,” he said. “And they too, could be very obvious. But as long I think these proven winners can stay strong and deliver, I’ll stick with them.”