Jim Cramer Thinks AI Revolution Can Boost These 5 Stocks

1. Salesforce Inc (NYSE:CRM)

Number of Hedge Fund Investors: 131

Salesforce is one of the stocks that will benefit from the ongoing AI revolution, according to Jim Cramer. He thinks that the massive rise of data centers to handle generative AI applications means there would be a demand for software solutions like Salesforce to process and parse this data. Last month, Jim Cramer said 2024 would be a “great year” for Salesforce.

The company recently posted Q4 results. Adjusted EPS in the period came in at $2.29, beating estimates by $0.02. Revenue in the quarter jumped 10.9% year over year to $9.29 billion, surpassing estimates by $70 million.

Polen Focus Growth Strategy stated the following regarding Salesforce, Inc. (NYSE:CRM) in its fourth quarter 2023 investor letter:

“In the fourth quarter, the top relative and absolute contributors to the Portfolio’s performance were Netflix, ServiceNow, and Salesforce, Inc. (NYSE:CRM).

Salesforce has continued to grow its revenues at what we see as a healthy rate despite market concerns about the impact of the weaker macroeconomy on its business and penetration rates in its core CRM offering. Even its most mature and largest offerings, Sales Cloud and Service Cloud, are still growing revenue at double-digit rates. In addition, management realized that their cost structure, especially in salespeople, had gotten too bloated. Over the past year and a half, the company has run a much more streamlined expense structure that has led to strong operating margin expansion and earnings growth. Importantly, we do not feel Salesforce has cut into its innovation or sales muscle through these cost cuts but has eliminated unnecessary excess fat from the organization.”

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