In this article, we’ll explore the 10 Stocks Jim Cramer Can’t Stop Talking About.
In a recent episode of Mad Money, Jim Cramer advises that worrying about what others are concerned about or getting excited about what everyone anticipates is generally futile for investors. When most investors expect something to happen, it’s often already factored into stock prices.
“You want to know the single most useless thing you can do in this business? Oh, that’s easy. The most useless thing you can do as an investor is to worry about what everyone else is worrying about. The flip side of this is also true: there’s no point in getting excited about something that everybody else is eagerly anticipating. Why? Because when the vast majority of investors agree that something’s going to happen, that thing is already priced into the stock market.”
The stock market reacts quickly to the consensus of hedge fund and mutual fund managers, so by the time the majority agrees on an economic trend, it’s already reflected in stock values. Cramer points out that while the real economy moves at a steady pace—through borrowing, manufacturing, transporting, and selling—stocks adjust almost instantly to new information. This rapid adjustment means that, once big institutional investors align on a particular economic outlook, it is already embedded in the market.
“While the real economy moves at its own steady pace—for example, you have to borrow money to build out equipment, then use that equipment to manufacture goods, transport them to retail outlets, and wait for customers to buy them—the stock market has no such limitations. Stocks don’t quite travel at the speed of thought, but they come pretty close. So, the moment a preponderance of hedge fund and mutual fund managers decide that the economy is slowing, speeding up, or flatlining, stocks start trading like that’s already the case.
Usually, it takes some time to build that kind of consensus, which is why you rarely see these moves happening instantaneously. But once the big institutional portfolio managers are on the same page about something, you can be pretty darn confident that it’s baked into the averages.”
The Efficient Markets Hypothesis
Jim Cramer points out that understanding some basic economics can be quite useful for managing investments, even though economists often use complex models that don’t always align with real-world data. Economists can be too focused on their theories and may ignore conflicting data, but basic economic principles can still offer valuable insights. One key concept Cramer highlights is the Efficient Markets Hypothesis.
This theory suggests that stock prices at any given moment already include all available information. When new data comes out, stock prices quickly adjust to reflect this updated reality. Index fund advocates use this theory to argue that it’s nearly impossible for stock pickers to outperform the market, as all known information is already factored into stock prices.
“This is some basic economics 101 stuff. Now, I don’t have a ton of use for economists as professionals on this show—they tend to take a totally ivory-tower approach to their discipline, meaning they have all sorts of models for how the economy is supposed to work (often very boring models, by the way). But they rarely let empirical facts get in the way of a good theory. If the data conflicts with the model, economists have a bad habit of throwing away the data, not the model. However, as long as you keep that caveat in mind, some basic economics is incredibly useful when you’re trying to manage your own money.
For example, let’s take something a little bit difficult, but we’re going to get through this together: what’s known as the Efficient Markets Hypothesis. This theory says that, at any given moment, stock prices already reflect all the relevant information that’s out there. When some new piece of data emerges, stocks immediately adjust to reflect the new reality. You often hear index fund purists citing this theory to explain why it’s impossible for stock pickers to get any kind of edge. According to them, whatever you know about a company should already be baked into its share price. As far as they’re concerned, markets are so efficient that investing in individual stocks is basically the same as gambling.
Jim Cramer explains that if all possible information about a stock is already reflected in its price, then doing detailed research may not give you an edge. In this view, the only factors that can move a stock’s price are new, unexpected pieces of information. If such information were known to anyone, it would already be factored into the stock price.
“If everything you could possibly know is already priced into the stock, that means your homework is meaningless, and the only thing that can push a stock higher or lower is some random new piece of information nobody knows about. It has to be something totally unknown because, if anyone did know, they would have already acted on it, and thus it would be baked into the share price.”
Essentially, they believe that only completely new, unknown information can influence stock prices, which makes individual stock investing seem like a gamble. Cramer acknowledges that while economists and their theories might seem detached from practical investing, understanding concepts like market efficiency can help investors navigate the complexities of stock investing.
“This means that, under the extreme version of the Efficient Markets Hypothesis, the only things that can move stocks are “unknown unknowns,” to use the parlance of former Defense Secretary Donald Rumsfeld. And if you’re merely betting on unknown unknowns, you might as well just be playing roulette—it’s more fun.
That’s why index fund advocates adore the Efficient Markets Hypothesis. This theory tells them that it’s impossible for individual investors to consistently beat the averages. So if you want equity exposure, the only smart way to do it is by putting your money into a nice, low-cost index fund that mirrors the S&P 500.”
Our Methodology
This article looks at a recent episode of Jim Cramer’s Mad Money, where he discussed several stocks. We’ve selected ten notable companies from his mentions. The article also explores how hedge funds perceive these stocks and ranks them according to their level of hedge fund ownership, from the least owned to the most owned.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Stocks Jim Cramer Can’t Stop Talking About
10. QuantumScape Corporation (NYSE:QS)
Number of Hedge Fund Investors: 11
Jim Cramer points out that QuantumScape Corporation (NYSE:QS) initially appeared to be an ambitious science experiment aimed at creating advanced battery technology for electric vehicles. Despite the promise of developing faster-charging and more efficient batteries, QuantumScape Corporation (NYSE:QS) was far from having a commercial product. Even years later, QuantumScape Corporation (NYSE:QS) had not generated any significant revenue.
“In retrospect, QuantumScape was basically a science experiment looking to develop better battery technology for electric vehicles. Anyone who can develop better, more efficient batteries with the ability to charge very quickly can make a killing, even in a world where electric cars have lost some of their luster. But QuantumScape was a long way from having anything they could actually commercialize and sell. Even four years later, these guys still didn’t have any meaningful revenue.
Back in 2020 and early 2021, Wall Street was still giving the benefit of the doubt to anything connected to electric vehicles. QuantumScape came public via a SPAC deal—and you have to remember, you need to be really skeptical of those. When that merger was announced, the SPAC it was merging with saw its stock more than double in just two trading sessions, putting it in the 20s. During this initial period of maximum hype, the stock shot up to nearly $132, peaking in December 2020. Then we started seeing short sellers coming out of the woodwork, arguing it was a scam, and Wall Street gradually lost interest in companies with zero profitability, let alone super-speculative names like QuantumScape. With no revenue, the stock got obliterated by late 2022, trading in the single digits, only able to bounce from those levels occasionally thanks to what I regard as short squeezes.
And look, QuantumScape is hardly alone—I’m not picking on it. All sorts of electric vehicle plays that came public during the IPO frenzy of 2021 got crushed. Rivian, although it ended up coming back, Lucid, Nikola, Canoo, Lion Electric, Lightning Motors, Lordstown Motors, Faraday Future, and Intelligent Electric all saw their stocks plunge more than 90% from peak to trough. Many, like Nikola, even had some fraudulent activity—their founder and CEO was sent to prison.”
QuantumScape Corporation (NYSE:QS) is set to revolutionize the electric vehicle (EV) battery market with its advanced solid-state lithium-metal batteries. These next-generation batteries promise significant improvements over traditional lithium-ion batteries, offering higher energy density, quicker charging, enhanced safety, and longer lifespan. This progress directly addresses key issues in EV adoption, such as limited range and slow charging times.
QuantumScape Corporation (NYSE:QS)’s strong partnership with Volkswagen not only provides essential financial backing but also ensures a clear path to market entry, as Volkswagen plans to use QuantumScape’s batteries in its future EV models. With the company working towards scaling up production and aiming for mass manufacturing by the mid-2020s, QuantumScape Corporation (NYSE:QS) is well-positioned to lead the future of EV batteries.
9. PVH Corp. (NYSE:PVH)
Number of Hedge Fund Investors: 32
Jim Cramer notes that PVH Corp. (NYSE:PVH), the parent company of brands like Calvin Klein and Tommy Hilfiger, saw its stock drop more than 5% today despite reporting strong second-quarter results. PVH Corp. (NYSE:PVH) posted slightly higher-than-expected sales and exceeded earnings projections by 72 cents, reaching $2.29 per share. However, the real issue lies with their disappointing guidance for the current quarter.
“PVH got hit today. Parent company of Calvin Klein, Tommy Hilfiger. Company reported a solid set of results last night. Slightly higher than expected sales paired with a monster 72-cent earnings beat off a $2.29 basis. I mean, the second quarter was good.
Problem here is that the guidance for the current quarter was completely mystifying and outright bad, for that matter. They expect sales to be down 6% to 7%. That’s worse than we thought. And they’re in $2.50. Analysts were looking for $3.12. I mean, that’s brutal.
Now, PVH typically guides conservatively, but this was below, much more below the expectations than usual. And given that the stock’s been more or less flat over the past 12 years with no strategic plan that I really have any confidence in, I can’t blame anyone for selling it. It’s starting to really bother me.”
Owning well-known brands like Calvin Klein and Tommy Hilfiger, PVH Corp. (NYSE:PVH) has proven its ability to adapt and thrive in the competitive apparel market. PVH Corp. (NYSE:PVH)’s careful cost management has helped it stay profitable even during tough economic times. PVH Corp. (NYSE:PVH)’s push for digital transformation, including growing its e-commerce presence and using data-driven marketing, positions it to benefit from the increasing online shopping trend.
As consumer spending on fashion picks up, PVH Corp. (NYSE:PVH)’s strong brand recognition and digital strategies are expected to drive revenue growth. Additionally, PVH Corp. (NYSE:PVH)’s broad global reach, expansion into important markets like Asia, and commitment to sustainable fashion enhance its growth prospects and stability, making it an appealing investment choice.
8. Zoom Video Communications Inc. (NASDAQ:ZM)
Number of Hedge Fund Investors: 39
Jim Cramer reflects on Zoom Video Communications Inc.(NASDAQ:ZM)’s trajectory since its public debut in 2019. Zoom Video Communications Inc. (NASDAQ:ZM) initially soared during the pandemic in 2020, as the demand for its video conferencing platform surged.
“Zoom Video came public in 2019 and then soared to the stratosphere in 2020 once the pandemic made its platform essential, at least during the COVID era. At first, you get a bunch of hot deals that get people excited. In 2020, we also had a ton of electric vehicle and charging station-related IPOs and SPAC mergers. Initially, these stocks were unstoppable, largely because this was a period of high-risk speculation where people were willing to give anything with the right buzzwords the benefit of the doubt—mistakenly, of course. It was reminiscent of the dot-com era in the late ’90s when anything connected with the internet was beloved until the market was flooded with excess supply, and the whole group collapsed in the year 2000.”
Zoom Video Communications Inc. (NASDAQ:ZM) is a strong investment due to its leading role in the video conferencing market, its growing range of products, and its ability to adapt to the hybrid work trend. Zoom Video Communications Inc. (NASDAQ:ZM), which became well-known during the COVID-19 pandemic, still benefits from the ongoing shift to hybrid work setups. Its core video conferencing platform remains essential for businesses, schools, and individuals, providing steady revenue.
Zoom Video Communications Inc. (NASDAQ:ZM) is expanding its product lineup with new tools like Zoom Phone, Zoom Rooms, and Zoom Events, which not only enhance its services but also offer opportunities for additional sales. Moreover, Zoom Video Communications Inc. (NASDAQ:ZM)’s investment in AI features aims to improve user experience and create new uses for its technology, strengthening its market position. With a strong financial foundation and continuous innovation, Zoom Video Communications Inc. (NASDAQ:ZM) is well-positioned for long-term growth as the need for remote and hybrid communication tools persists.
7. Enphase Energy Inc. (NASDAQ:ENPH)
Number of Hedge Fund Investors: 42
Jim Cramer points out that the dramatic rise in Enphase Energy Inc. (NASDAQ:ENPH)’s stock in 2020 and 2021 was closely tied to the low-interest rates that made borrowing money cheap. He emphasizes the importance of understanding the factors driving a stock’s movement.
“It’s not a coincidence that something like Enphase was roaring in 2020 and 2021 when people could borrow money for next to nothing. Let me give you the bottom line: It’s very helpful to understand why a stock you like is going up or down. When you have a win, don’t lazily assume you simply got it right—think about what it means if you were merely in the right place at the right time. And please, proceed with caution.”
Enphase Energy Inc. (NASDAQ:ENPH) is a great investment pick due to its leading role in the solar micro-inverter market, strong financial performance, and the growing demand for renewable energy. Enphase Energy Inc. (NASDAQ:ENPH) has consistently grown its earnings thanks to its advanced micro-inverters, which boost solar energy efficiency. Enphase Energy Inc. (NASDAQ:ENPH)’s expertise and expansion into energy storage and smart home energy management position it well to benefit from the global move towards clean energy.
In its Q2 2024 earnings report, Enphase Energy Inc. (NASDAQ:ENPH) showed impressive revenue growth of $711 million, driven by high demand in Europe and the U.S., despite a challenging economic environment. Enphase Energy Inc. (NASDAQ:ENPH)’s healthy profit margins indicate effective cost management while scaling up. Enphase Energy Inc. (NASDAQ:ENPH) is also expanding into Latin America and Asia-Pacific, highlighting its global growth strategy. Recent product innovations, like the IQ8 micro-inverters, along with strategic partnerships with major solar distributors and installers, further boost its market presence and revenue potential, supporting a positive outlook for continued growth.
6. Martin Marietta Materials Inc. (NYSE:MLM)
Number of Hedge Fund Investors: 45
Jim Cramer suggests that Martin Marietta Materials Inc. (NYSE:MLM) is a solid investment because it focuses on essential building materials for new housing developments. However, Cramer notes that the real gains for Martin Marietta Materials Inc. (NYSE:MLM) will come later after homebuilders fully commit to new construction projects. This means Martin Marietta Materials Inc. (NYSE:MLM)’s performance might improve significantly once the construction of new homes picks up speed.
“The more tangible plays are going to be Martin Marietta Materials, which represent the basics of building out new housing developments. But those really start winning later on, once the homebuilders fully embrace new construction.”
Martin Marietta Materials Inc. (NYSE:MLM) is an appealing investment because of its leading role in the construction materials industry, its ability to benefit from infrastructure investments, and its strong financial performance. As a major supplier of aggregates, cement, and ready-mixed concrete, Martin Marietta Materials Inc. (NYSE:MLM) is well-positioned to take advantage of the ongoing demand for infrastructure development across the United States.
In Q2 2024, Martin Marietta Materials Inc. (NYSE:MLM) reported a 10% increase in revenues year-over-year, reaching $1.82 billion. This growth was driven by strong demand in both public and private construction sectors, bolstered by federal and state infrastructure funding, price increases, and effective cost management. Martin Marietta Materials Inc. (NYSE:MLM) is also expanding its operations through strategic acquisitions, which enhance its geographic reach and production capacity.
With a strong balance sheet and a disciplined approach to capital allocation, Martin Marietta Materials Inc. (NYSE:MLM) is well-equipped to pursue growth opportunities and return value to shareholders through dividends and share repurchases. Given the U.S. government’s ongoing investment in infrastructure, including the Infrastructure Investment and Jobs Act, Martin Marietta Materials Inc. (NYSE:MLM) stands to benefit significantly from increased spending on transportation and public works, reinforcing its potential as a worthwhile investment.
5. Abercrombie & Fitch (NYSE:ANF)
Number of Hedge Fund Investors: 48
Jim Cramer notes that Abercrombie & Fitch (NYSE:ANF)’s stock dropped 17.7% on Friday despite reporting strong earnings. Abercrombie & Fitch (NYSE:ANF) posted an 18% increase in same-store sales and a 21% rise in revenue, with earnings of $2.50 per share, exceeding expectations of $2.22. This represents a significant 127% growth in earnings year-over-year.
“ANF stock plunged 17.7% today despite reporting what I thought was a pretty darn good, solid set of numbers. ANF had 18% same-store sales growth, higher than expected. 21% revenue growth. They earned $2.50 per share. Street was only looking for $2.22. That’s 127% earnings growth year-over-year. Hey, kind of like NVIDIA!
The company even raised its full-year sales forecast aggressively, also boosted their operating margin guidance. So what was the problem then? Well, the sellers seemed to focus on three words from an otherwise positive quote from ANF’s—well, let’s just say really—CEO. She has the place so well-run, Fran Horowitz, and she wrote the words “increasingly uncertain environment” into the call. And while the updated full-year forecast was terrific, the forecast for the current quarter represented a deceleration from the results they just reported.
Hey, look, frankly, I’m grasping. They’re the only explanations I can find for this selling, and I don’t think it’s convincing. Abercrombie is giving conservative quarterly guidance in a tough operating environment, and with football season on the horizon, let’s just say I take the over on the third quarter outlook.”
Abercrombie & Fitch (NYSE:ANF), with its effective brand overhaul, solid financial results, and successful digital strategy, is an attractive investment. Abercrombie & Fitch (NYSE:ANF) has transformed its image from a “preppy” style to one that is more inclusive and diverse, helping it attract a broader and more loyal customer base. In Q2 2024, Abercrombie & Fitch (NYSE:ANF) saw a 16% increase in net sales, reaching $935 million, thanks to improved gross margins, higher full-price sales, and strong performance from the Hollister brand. Abercrombie & Fitch (NYSE:ANF)’s digital strategy has been fruitful, with e-commerce now a significant revenue source.
Additionally, Abercrombie & Fitch (NYSE:ANF) is smartly expanding its physical presence by opening new stores in key areas while closing less successful locations. Its commitment to sustainability and corporate social responsibility also adds to its appeal. With strong financial health, a successful rebranding effort, and a focus on digital growth, Abercrombie & Fitch (NYSE:ANF) is well-positioned for continued success in the retail market.
4. Bath & Body Works (NYSE:BBWI)
Number of Hedge Fund Investors: 55
Jim Cramer comments on Bath & Body Works (NYSE:BBWI), noting that the struggling retailer reported a disappointing quarter, causing its stock to drop 7%. Bath & Body Works (NYSE:BBWI)’s comparable sales and revenues fell short of expectations, and earnings were only slightly above forecast, still down 7.5% from the previous year. Bath & Body Works (NYSE:BBWI)’s management also provided a bleak outlook, cutting both current quarter and full-year earnings forecasts.
“Finally, Bath & Body Works. The struggling mall retailer reported another bad quarter today. Shares sunk 7%. Comparable sales missed, revenues missed, and the only earnings came in just a penny better than expected, which was still down 7.5% year-over-year. Worse, management guidance for the current quarter was horrific, and they slashed their full-year earnings, their full-year forecast.
CEO Gina Boswell says that, quote, “They’re taking a prudent approach,” end quote, to their outlook by cutting numbers. So I’ll take the prudent approach and tell you: Please don’t go near Bath & Body Works. You can go to Bath and Body Works, it smells nice. You walk by it, I always like—can you smell it? I smell it right now. I mean, like, you can just, like, you know, reflect on it. It’s like International Flavors & Fragrances. It’s right here, or maybe it’s here in the Vegas nerve.
Bottom line, looking back at the last 24 hours in retail: Nordstrom and Kohl’s deserved a rally today, but they’re both very much in show-me mode, especially Kohl’s. Abercrombie and Foot Locker got hit way too hard. I really like the Foot Locker. ANF, great buying opportunity. As for PVH, Bath & Body Works, all I can say is, as our—as the man who is behind so much of the greatness of the show, Cliff Mason, used to say: “If you lie down with dogs, you wake up with fleas.”
Bath & Body Works (NYSE:BBWI) represents a strong investment opportunity due to its solid brand loyalty, successful product innovation, and efficient cost management. As a top player in personal care and home fragrance, Bath & Body Works (NYSE:BBWI) has shown resilience in a challenging retail landscape by leveraging its well-established brand and deep customer connections. In its Q2 2024 earnings report, Bath & Body Works (NYSE:BBWI) exceeded expectations with $1.56 billion in net sales.
Bath & Body Works (NYSE:BBWI)’s focus on innovation, particularly in fragrances and body care, has driven steady consumer demand. Its strong profit margins, supported by strategic pricing and careful inventory management, have maintained profitability despite inflation. Additionally, Bath & Body Works (NYSE:BBWI) is growing into new areas like wellness and home care and investing in its digital capabilities to improve e-commerce and the overall shopping experience.
3. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Investors: 64
Jim Cramer discusses The Procter & Gamble Company (NYSE:PG), suggesting it could be a solid investment due to its strong management, attractive dividend, and the potential benefits from lower plastic and fuel costs. However, he cautions that stock market movements are not always driven by logic.
“Maybe you want to buy Procter & Gamble, a longtime favorite. There are lots of logical reasons to like them, but like I told you earlier, logic is rarely what drives the stock market on a day-to-day basis.
Let’s follow through here: Suppose you pick up some Procter & Gamble because you really believe in management, you like the dividend, or you think that plastic and fuel costs are going down, which will boost the company’s gross margin—a huge part of their expenses. So you buy the stock, and then it explodes higher. What’s next? Well, you have to ask yourself, why is it rallying? It’s very easy to tell yourself, “I nailed it! The market’s finally giving Procter & Gamble the credit it deserves.” When you buy a stock and it goes up, that means you were right, right? Why would you second-guess yourself when you’re right?
Well, the answer is simple: Maybe you were just lucky. As I’ve told you before, it’s better to be lucky than good, but either way, you need to be able to tell the difference. So, let’s say you rack up a nice win in Procter & Gamble—you should ask yourself if you were right or if you simply happened to be in the right place at the right time.”
As a major global consumer goods company with well-known brands like Tide, Pampers, and Gillette, The Procter & Gamble Company (NYSE:PG) benefits from a diverse range of products that provide stability, even during challenging economic periods. In its Q4 2023 earnings report, The Procter & Gamble Company (NYSE:PG) demonstrated impressive performance with net sales reaching $20.6 billion, a 5% increase from the previous year. This growth was driven by smart price adjustments and a positive product mix, helping to counteract the impact of inflation and rising costs. The Procter & Gamble Company (NYSE:PG)’s strong brand loyalty and pricing power allow it to pass on higher costs to consumers without significantly reducing demand.
Moreover, The Procter & Gamble Company (NYSE:PG)’s focus on innovation and sustainability further enhances its market position. The Procter & Gamble Company (NYSE:PG) is investing in new, premium, and eco-friendly products that meet the growing consumer demand for sustainable options. Its commitment to environmental goals, including carbon neutrality and waste reduction, strengthens its appeal to environmentally conscious consumers. The Procter & Gamble Company (NYSE:PG)’s strong cash flow enables it to deliver value to shareholders through dividends and share repurchases.
2. Sherwin-Williams (NYSE:SHW)
Number of Hedge Fund Investors: 76
Jim Cramer highlights that some stocks, including Sherwin-Williams (NYSE:SHW), have experienced significant gains. While Sherwin-Williams (NYSE:SHW), a paint company, is frequently recommended, Cramer suggests it might be time for a pullback. In other words, after a strong performance, it could be wise to be cautious about holding onto Sherwin-Williams (NYSE:SHW) too long without expecting a temporary dip.
“Now, some stocks have had such mammoth runs that you don’t want to have your money languish. Sherwin-Williams, for example, the paint company, is recommended almost every day, but this one is due for a pullback.”
As a leading global supplier with a vast distribution network and well-known brands, Sherwin-Williams (NYSE:SHW) serves a broad customer base across residential, commercial, and industrial markets. Sherwin-Williams (NYSE:SHW)’s Q2 2024 earnings highlight its success, with net sales rising 6% year-over-year to $6.24 billion. This increase is driven by robust demand in both its Professional and DIY segments and the company’s effective pricing strategies that manage cost increases without hurting sales volumes.
Sherwin-Williams (NYSE:SHW)’s growth strategy includes expanding its retail presence and enhancing its e-commerce capabilities. Sherwin-Williams (NYSE:SHW) is opening new stores and upgrading existing ones, especially in high-growth areas, and is also growing its international market presence. Its investment in innovative and sustainable products meets the rising consumer demand for eco-friendly options, boosting its competitive edge.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Investors: 179
Jim Cramer explains that NVIDIA Corporation (NASDAQ:NVDA) often appears expensive based on future earnings estimates, but it consistently surpasses those expectations, making the stock look undervalued in hindsight. This pattern has been a remarkable feature of NVIDIA Corporation (NASDAQ:NVDA) since 2012. Cramer advises investors not to focus too much on daily fluctuations in a stock’s price. Instead, it’s important to discern when these movements are meaningful signals versus when they are simply noise with no real significance.
“When you look at NVIDIA on forward earnings or estimates, it always looks expensive, and then it so far trumps those estimates that when you look backward, it turns out the stock was selling at a remarkably low price. That’s been the secret to NVIDIA literally since 2012—incredible! It just keeps doing that, right? Please don’t put too much significance on day-to-day gyrations in a stock’s share price. You have to know when something is a signal and when it’s all just sound and noise, always signifying nothing.”
NVIDIA Corporation (NASDAQ:NVDA) is a highly attractive investment due to its leading role in the semiconductor industry, particularly in GPUs and AI technologies, as well as its impressive financial performance and expanding market opportunities. As a dominant player in tech, NVIDIA Corporation (NASDAQ:NVDA) benefits from the rapid growth in AI, data centers, gaming, and autonomous vehicles.
In its Q2 FY2024 earnings report, NVIDIA Corporation (NASDAQ:NVDA) achieved record revenue of $13.51 billion, marking a 101% increase from the previous year. This growth is driven by exceptional demand for its GPUs, particularly those used in AI and data centers, with the Data Center segment seeing a 171% revenue boost. This underscores NVIDIA Corporation (NASDAQ:NVDA)’s pivotal role in supporting AI technologies and large language models.
NVIDIA Corporation (NASDAQ:NVDA)’s strong momentum is further supported by its strategic partnerships and innovative product offerings. NVIDIA Corporation (NASDAQ:NVDA) is a key player in the AI revolution, providing essential hardware to cloud providers, enterprises, and research institutions. Its recent collaborations to advance generative AI solidify its leadership position. Additionally, NVIDIA Corporation (NASDAQ:NVDA) is expanding into new areas such as automotive and edge computing, where its AI and GPU technologies are increasingly being adopted. NVIDIA Corporation (NASDAQ:NVDA)’s ongoing investment in research and development and its robust product pipeline keep it at the cutting edge of innovation.
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA), our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones on our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
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