Jim Cramer Looked Closely At These 10 Stocks

1. Advanced Micro Devices, Inc. (NASDAQ:AMD)

Number of Hedge Fund Holders: 107

Cramer was asked about Advanced Micro Devices, Inc. (NASDAQ:AMD) recently and he replied:

“Look, I think that it’s a great company. I do think that there’s a lot of people who believe that they will not be able to deliver on this quarter. I therefore am reluctant to get in ahead of the quarter and we did sell the stock a little bit higher for the Charitable Trust.”

Advanced Micro Devices (NASDAQ:AMD) is a semiconductor company known for its advanced processors and graphics technology used in PCs and data centers. In November 2024, Cramer shared that he was looking to buy AMD stock for his Charitable Trust, noting that the company had an exceptional quarter, with AI chip revenue expected to reach $5 billion, much higher than the $2 billion he would have anticipated a year or two ago.

However, he pointed out that traders were not focused on Advanced Micro Devices (NASDAQ:AMD) past performance but on future results, and while the company did well, it was not enough to fully satisfy market expectations. He added:

“Management guided for good revenues and good, but not good enough earnings. When you’re a high-rolling AI company in the same league as… Nvidia, you need to deliver Nvidia-style blast-offs. CEO Lisa Su didn’t give us a blastoff, it was fine, not special. Of course, the problem with the forecast is that AMD’s facing supply constraints, they literally can’t make enough chips to meet the demand. That’s a high-quality problem.

And you know, the forecast was like, here and there. Think of this company as a B student that basically gave you an inline forecast right down the middle. That’s not enough. So the stock got us clock cleaned… The numbers were simply good, but not good enough given the expectations. So that’s why the stock dropped more than 10% to where I think we probably should be buying some for the Charitable Trust.”

While we acknowledge the potential of Advanced Micro Devices, Inc. (NASDAQ:AMD) as an investment, our conviction lies in the belief that 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 AMD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.