In this piece, we will look at Jim Cramer’s bold predictions about these AI stocks.
Given that AI has dominated stock market headlines for more than a year now, it’s no surprise that Jim Cramer of CNBC’s Mad Money and Squawk on the Street has also devoted quite a bit of airtime discussing the technology. He is extremely bullish on AI and has gone as far as to suggest that the world’s largest AI GPU company, the one run by Jensen Huang, is ushering in a new industrial revolution.
Don’t believe us? Well, take a look at his own words. In a recent Squawk on the Street appearance, Cramer said the following about Huang and his company:
“Industrial revolution, why can’t we believe? Do you remember, did you read that, book about John Garfield, where they talked about the telephone, and Alexander Graham Bell tries to get it into the centennial in Philadelphia, and only because the Brazilian guy there doesn’t get to represent it. And Alexander Graham Bell says you know this could revolutionize all of how we do things. And the American judges were like who is this clown?”
“I find over and over again that when you have the industrial revolutions no one really believes in them. And here’s Jensen Huang.”
One major AI announcement in January that has created quite a bit of a splash is President Trump’s $500 billion Stargate project. Trump announced the project joined by executives from several big tech companies. Cramer believes that Stargate might end up underpinning industrial growth in the US. Stargate might also require the US to build the energy infrastructure necessary to support massive data centers. According to Cramer:
“Crisis comes down to the fact that we had no real industrial growth in this country for decades so we haven’t had to build much energy infrastructure. Now all of a sudden these data centers start coming online like the ones that will be part of Stargate, the Oracle, SoftBank, OpenAI project… And these data centers consume insane amounts of electricity. It’s a level of demand that nobody saw coming. So after years where we spent more time decommissioning power plants and building new ones, we suddenly gotta go back into growth mode.”
These aren’t his only comments about Stargate. Cramer believes that the announcement might underlie a new paradigm shift in the US ecosystem. This ecosystem blossomed through the partnership between Bill Gates’ software company and OpenAI. However, Cramer believes that the shares of one of the world’s largest enterprise resource planning companies soared after the announcement because “maybe because there’s a reshuffling of the alliance. And the alliance could be in play.” He believes that “the fluid nature of things here is rather extraordinary” and that the firm might have replaced the software company:
“[the ERP provider] might have replaced Microsoft in an OpenAI joint venture. This would be extraordinary. And you know Carl, I don’t know whether Ellison [Larry Ellison] was doing a dance yesterday because he was so happy about this announcement. Or because he may have a real coup here. And betting against Ellison has been one of the biggest fools game in history. Man he was on his game yesterday.”
The booming demand for energy from AI data centers has injected fresh life into nuclear power companies. Some of these firms are up by a whopping 186% year-to-date. While Cramer is skeptical about the near-term returns offered by nuclear power stocks, one energy source that he believes might become popular again is coal. Here’s what he said in a recent Mad Money episode:
“Under this president, coal could have… a renaissance. Sure, coal’s time has come and gone, but it will come again because the data center inspired energy crisis really is so pressing that there’s not really a choice anymore. Yes, the demand is that great, [and] we so foolishly mothballed good nuke plants that it wouldn’t surprise me if coal’s long decline may have finally run its course.”
Our Methodology
To compile our list of Jim Cramer’s bold predictions about AI stocks, we scanned the stocks he mentioned in Mad Money and Squawk on the Street as far back as September 2024. Then, we picked out AI stocks and ranked them by the number of hedge funds that had bought the shares in Q3 2024.
For these stocks, we also mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds invest in? 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).
12. Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders In Q3 2024: 33
Date of Cramer’s Comments: 09-05-24
Performance Since Then: -19.75%
Super Micro Computer, Inc. (NASDAQ:SMCI) is a computer hardware company that has been in the news for all the wrong reasons lately. The firm’s shares sank by 19% in August last year after short-seller Hindenburg Research claimed significant accounting improprieties and Super Micro Computer, Inc. (NASDAQ:SMCI) failed to file its annual report. Since then, Hindenburg has closed down and Super Micro Computer, Inc. (NASDAQ:SMCI) has announced that an internal probe found no evidence of fraud. On the day of the latter announcement, its shares surged by 28%. The firm is due to file its 10K report on February 25th. Here’s what Cramer said in September:
“I’m not a believer in this, to be honest. I thought the Hindenburg report was good. I wouldn’t have been as enthusiastic if it weren’t for that filing the company made the next day. I think Super Micro is good, but when you read the Hindenburg report, it’s clear they need to improve their accounting practices, and that’s what worries me.”
11. ARM Holdings plc (NASDAQ:ARM)
Number of Hedge Fund Holders In Q3 2024: 38
Date of Cramer’s Comments: 09-09-24
Performance Since Then: 29.46%
ARM Holdings plc (NASDAQ:ARM) is a British design house whose intellectual property powers up data center processors and most of the world’s smartphones. Since Cramer’s comments in September, the stock has gained 29.46% on the back of several catalysts. One such gain came in November when the stock added 4% following a strong Q3 earnings report. ARM Holdings plc (NASDAQ:ARM)’s stock has also gained 26.8% year-to-date. These gains are because of President Trump’s $500 billion Stargate AI plan in which investors believe ARM Holdings plc (NASDAQ:ARM) can play an important role. Here’s what Cramer said about the stock in September:
“Don’t forget about Arm, the 7-nanometer kingpin whose stock has more than doubled since it came public again roughly a year ago. That’s despite pulling back from $188 in early July to $125 today. Arm got a nice boost today on now-confirmed reports that its chip designs are being used in the just-launched iPhone 16. The processor is built on their architecture—that’s not a shocker, but some people don’t understand that.
On Friday, many were buzzing about the relentless decline in semiconductor firm Arm Holdings. The stock fell from $123 down to $117, and this was after already coming down from $132 at the end of the previous week. Arm seemed spent, done. Then, today, it shoots back up to $125—up 7%, supposedly because the new iPhone is using their latest design for custom processors. Something that should have been obvious to everyone for months! Was Friday’s sell-off based on pure emotion, and today’s rally just emotion right back? Or did nothing truly happen at all to Arm on either Friday or Monday?
Arm is unique in that it designs semiconductor architecture, licenses it out to chipmakers, and collects royalties on their sales. This gives them a nice, predictable revenue stream. Their technology is firmly entrenched in data centers, mobile devices, and even the CPU portion of NVIDIA’s top AI platforms. They’ll be big winners from a new smartphone upgrade cycle fueled by all this new AI functionality.
There’s a reason Apple went with Arm’s architecture—they dominate the mobile space. Again, I’d be a buyer into the recent weakness because I think the long-term upside potential is enormous, and I don’t mind that it’s up that much today. It can go further.
Here’s the bottom line: it’s time to fall back in love with semiconductors. Some of the most beaten-down chip stocks have been punished enough, and now you’re finally getting a chance to buy Arm and Micron.”
10. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Holders In Q3 2024: 60
Date of Cramer’s Comments: 09-04-24
Performance Since Then: 4.28%
Dell Technologies Inc. (NYSE:DELL) is a computer hardware company that provides products to the consumer and enterprise industries. The only notable share price movement since Cramer’s quoted remarks has been a 12.3% share price drop in November following the firm’s third-quarter earnings. The results saw Dell Technologies Inc. (NYSE:DELL) forecast midpoint Q4 revenue at $24.5 billion which was lower than analyst estimates of $25.6 billion. Its PC revenue of $12.13 billion also missed analyst estimates of $12.43 billion. Another notable price movement was in October, and it stemmed from rival Super Micro’s woes. Here’s what Cramer said in September:
“This story is all about Dell making servers for the data centers that power artificial intelligence, along with new lines of AI-infused PCs. Unfortunately, the numbers were somewhat confusing, but I think that Wall Street got this one right—at least initially—as the stock timely rallied more than 4% last Friday before giving back all those gains today. Yep, Dell’s still worth owning here, and I’m going to tell you why. Let’s start with the numbers: Dell delivered a meaningful revenue beat driven by 38% growth from its Infrastructure Solutions division. Much better than expected, mostly thanks to heavy investment in AI infrastructure by corporate clients. In fact, their server and networking sales were up 80% year-over-year.
Dell’s other business, the Client Solutions Group, which includes the PC business, came in a little light, but not light enough to offset the strength in the infrastructure side. In the earnings release, Dell Vice Chairman and COO Jeff Clarke, an old hand, explained that “our AI momentum accelerated in Q2, and we’ve seen an increase in the number of enterprise customers buying AI solutions each quarter.” Notice the word “solutions”—I think that’s really important. It’s more than just a box. He added that AI-optimized server demand jumped by 23% compared to the previous quarter.
Now, last time Dell reported, some investors didn’t like the margins from Dell’s infrastructure business. Long story short, their earlier AI hardware sales mainly came from selling servers to large hyperscalers—here we’re thinking about Alphabet, Amazon, Meta—and those companies can drive a hard bargain. Dell was confident that the margins would improve later on as they sold more networking and storage equipment along with services, but hardly anyone was willing to give them the benefit of the doubt. Except me, maybe. That’s because I saw that Jeff was with Jensen—of course, Jensen Huang, CEO of Nvidia—at the GTC conference I attended.”
9. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders In Q3 2024: 68
Date of Cramer’s Comments: 09-06-24
Performance Since Then: 10.3%
Intel Corporation (NASDAQ:INTC) is the troubled American integrated chip manufacturing giant that’s been beset with multiple woes over the past year or so. Since Cramer’s September comments, its shares have gained 10.3%. Several events have driven the upward momentum. For starters, in November, Intel Corporation (NASDAQ:INTC) guided $13.8 billion in midpoint sales that beat Wall Street estimates of $13.66 billion. The firm also announced progress with its cost-cutting plans. Then, in December, the stock rallied and then fell after CEO Patrick Gelsinger’s sudden departure. Year-to-date Intel Corporation (NASDAQ:INTC)’s shares are up 16% on market rumors that Elon Musk or others might acquire the company. Here’s what Cramer said in September:
“The Financial Times reports that Intel has been rocked by key defections, including Stuart Pann who was named head of the foundry business in 2023. Shlomit Weiss, a key designer, departed in April. Coupled with stock price declines, the deck looks increasingly stacked against CEO Pat Gelsinger’s turnaround plans.”
8. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders In Q3 2024: 91
Date of Cramer’s Comments: 09-06-24
Performance Since Then: 31.25%
Oracle Corporation (NYSE:ORCL) is the enterprise resource planning that we mentioned in the introduction to this piece. It is one of the largest players in its industry, and the stock has seen several catalysts since September. Oracle Corporation (NYSE:ORCL)’s shares surged by 11% in September after the firm’s second-quarter earnings report saw it beat analyst revenue and EPS estimates. Then, the stock jumped by 10% in November only to fall by 8% in December after a poor earnings report. Year-to-date, the stock is up by 10.6% after President Trump’s $500 billion Stargate AI announcement. Here’s what Cramer said in September:
“Oracle has reinvented itself with an AI kicker to go with its regular enterprise software business. As of last quarter, it’s been performing exceptionally well, and I think they’re going to do it again. Oracle could stop the tech blood flow.”
7. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders In Q3 2024: 107
Date of Cramer’s Comments: 09-04-24
Performance Since Then: -12.80%
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a chip designer that makes and sells CPUs, GPUs, and other chips. The firm has faced a tumultuous time on the stock market since Cramer’s remarks as it has been unable to cash in on AI demand. Analysts are also worried about Advanced Micro Devices, Inc. (NASDAQ:AMD)’s personal computing market. The firm’s stock fell by nearly 12% in December after multiple analysts downgraded the stock and cut the share price target. These included a Bank of America note that warned about a sluggish PC market in H1 2025. Here’s what Cramer said about Advanced Micro Devices, Inc. (NASDAQ:AMD) in September:
“Very, very tough. . . I think Lisa Su from AMD is just terrific too. It doesn’t have to be either/or [AMD or AVGO] because the charitable trust owns both. But, you know what? In two days, anything can happen—that’s how crazy this market is.”
6. Adobe Inc. (NASDAQ:ADBE)
Number of Hedge Fund Holders In Q3 2024: 123
Date of Cramer’s Comments: 09-06-24
Performance Since Then: -22.7%
Adobe Inc. (NASDAQ:ADBE) is a productivity software company. Since Cramer’s remarks, the stock is down by a whopping 22.7%. Two major drops are the reason behind Adobe Inc. (NASDAQ:ADBE)’s poor share price performance. The first of these saw the shares sink by 13% in September after the firm’s fiscal Q3 earnings saw it guide midpoint Q4 revenue at $5.525 billion which was below analyst estimates of $5.61 billion. Adobe Inc. (NASDAQ:ADBE)’s EPS also missed the mark, with the shares tumbling by another 14% in December when its 2025 revenue guidance of $23.30 billion and $23.55 billion missed estimates of $23.78 billion. Here’s what Cramer said in September:
“Adobe reports after the close. We’ve had three positive analyst notes ahead of this quarter, which is extremely bullish. Against that, of course, is the fact that Adobe is a tech company with an AI component, which is now suddenly “guilty until proven innocent”—a complication to an otherwise magnificent story. That said, I sense this should be a good result for the bulls, given that the analysts are promoting it so aggressively ahead of the quarter.”
5. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders In Q3 2024: 128
Date of Cramer’s Comments: 09-11-24
Performance Since Then: 54.61%
Broadcom Inc. (NASDAQ:AVGO) is one of the largest and most valuable semiconductor companies in the world. Its shares have been on a tear since Cramer’s remarks and have added a whopping 54.6% in gains. All of these gains have come primarily on the back of blowout announcements by management in December. In December, Broadcom Inc. (NASDAQ:AVGO)’s shares surged by an unbelievable 62.2% as the company shared that it expected to earn up to $70 billion from selling AI chips in 2027. At the same time, Broadcom Inc. (NASDAQ:AVGO) also forecast a 22% revenue growth for its Q1 Fy25. Here’s what Cramer had shared in September:
“Did you know that today Broadcom Inc (NASDAQ:AVGO) traded above where it was sitting before the aforementioned quarter, which I told you was good anyway? The one that seemed to be hated but now seems to be transforming from an ugly duck into a beautiful, but angry, swan. Have you ever noticed swans are really angry? Look, we’re in a highly emotional market.”
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders In Q3 2024: 158
Date of Cramer’s Comments: 09-05-24
Performance Since Then: 0.18%
Apple Inc. (NASDAQ:AAPL) is the largest consumer electronics company in the world. Since Cramer’s comments in September, the stock has been flat and has added a negligible 0.18%. However, this doesn’t mean that the actual performance has been lackluster. Between September and late December, Apple Inc. (NASDAQ:AAPL)’s shares gained a respectable 16.5%. Since then, they have lost 14% on the back of analyst downgrades and a report suggesting that iPhone shipments in China fell by 17% in 2024. Loop Capital’s downgrade to Hold from Buy with a $230 price target (down from an earlier $275) along with bearishness from Jefferies haven’t helped the case either. Here’s what Cramer said about Apple Inc. (NASDAQ:AAPL) in September:
“In fantasy football, what you want is steady production and solid performance week in and week out. That’s why I’ve long said that Apple, the original “own it, don’t trade it” stock, is like the quarterback of your portfolio. Last year, I said Patrick Mahomes from the Chiefs was the Apple of the NFL, and that analogy worked pretty darn well, as he led the Chiefs to their third Super Bowl victory in four years. Meanwhile, Apple is up more than 20%.”
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders In Q3 2024: 193
Date of Cramer’s Comments: 09-04-24
Performance Since Then: 34.28%
NVIDIA Corporation (NASDAQ:NVDA) is the leading global AI GPU designer. Since Cramer’s September remarks, the stock has seen bullishness from analysts and rumors of problems with its Blackwell GPU supply. Truist raised the price target to $204 from $169 in December after the stock had set an intraday record in October after a strong earnings report from Taiwan’s TSMC. NVIDIA Corporation (NASDAQ:NVDA) also rallied in November after President Trump’s victory. However, the stock fell by 3% in January after US export control rules targeted its GPUs. The dip maintained the downward trend that had started since CES when CEO Jensen Huang didn’t share any details about NVIDIA Corporation (NASDAQ:NVDA)’s next-generation Rubin chips. Here’s what Cramer had said in in September:
“A repeat of 1999 would indeed be devastating for NVIDIA and all the tech that surrounds it. As much as I think Cembalest is the best pure strategist on Wall Street—the best I’ve found—I found this piece a little harsh because we had many fly-by-night outfits spending like drunken sailors back in the 1990s. Now, though, the firm and its clients are some of the most well-endowed companies ever. The company doesn’t have any real competition, and no one is near them by their own proclamations.”
“As the company’s CEO Jensen Huang has pointed out many times, if the tech titans don’t spend, they’re out of luck when some great use cases come along, and they don’t have the infrastructure for it. Remember, Jensen has proved that the platform pays for itself very quickly. That sure wasn’t the case back in 1999, was it? Of course, the company’s stock has become a total pariah right now after this amazing quarter because the world suddenly seems convinced that AI spending will peak soon, at which point it’s all over but the shouting.”
“Stocks are getting slammed because most investors think the company’s run-up was too extreme, given that the company only reported a major upside surprise—not the kind of insanely huge upside surprise they’d come to expect. The sellers are eager to take the company back to where it was trading during the last visit to the penalty box in the first week of August, with the stock ticking as low as $90 and change.”
“I’m sure the sellers will be right back tomorrow morning after we learned tonight that the Justice Department has hit the company with a subpoena over an antitrust probe. Now, who cares? That’s standard practice. It’s shot first, second, and third. Though with the company right now, no one’s thinking, ‘Well, wait a second, why didn’t the Justice Department just ask them some questions?'”
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders In Q3 2024: 202
Date of Cramer’s Comments: 09-04-24
Performance Since Then: 27.97%
Alphabet Inc. (NASDAQ:GOOGL) is a mega-cap technology giant whose shares haven’t performed too well lately. In fact, between Cramer’s remarks and early December, the stock had gained 12.9% as it navigated through a 5% drop in November following reports that the firm was being pushed to sell its Chrome business. However, since early December, Alphabet Inc. (NASDAQ:GOOGL)’s shares have gained 14% primarily on the back of a massive announcement in December. This announcement saw the firm reveal its Willow quantum computing chip which it claims can perform calculations that would take a supercomputer ten septillion years in less than 15 minutes. Here’s what Cramer said in September:
“Stocks can’t stabilize until these weak shareholders sell out. History shows that significant market drops like this tend to offer great buying opportunities. On October 25th, 2023, Google dropped $180 billion, and since then, it’s come back with a 25% gain—not bad, but it’s the only stock on this list that failed to beat the S&P, which jumped 32% in that time.”
“Next week, Justice goes to court to try to stop Google. The Department claims in its brief that Google abuses its monopoly power to disadvantage website publishers and advertisers who dare to use competing ad tech products in search of higher quality or lower cost matches. According to the brief, Google uses “its dominion over digital advertising technology to funnel more transactions to its own ad tech products, where it extracts inflated fees to line its own pockets at the expense of the advertisers and publishers it purportedly serves.”
“Now, Google was recently found to be engaged in anti-competitive behavior when it paid to become the default search engine for Apple. Yeah, they got nailed for that. I get it—they paid to reach a huge audience. Microsoft could have outbid them to make Bing the default search engine, but they didn’t. However, this new case is more absurd. The Justice Department is going after Google in a business where they’re already losing market share in the open market.”
1. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders In Q3 2024: 235
Date of Cramer’s Comments: 09-04-24
Performance Since Then: 26.2%
Meta Platforms, Inc. (NASDAQ:META) is the most valuable social media company in the world. After Cramer’s comments in September, Meta Platforms, Inc. (NASDAQ:META)’s shares jumped by 6.8% in late November and start of December after the firm announced a plan to build a massive $10 billion global subsea cable that can provide it with a key position in the global internet infrastructure market. Year-to-date, Meta Platforms, Inc. (NASDAQ:META)’s stock is up by 9.51% as the firm benefits from CEO Mark Zuckberberg’s relationship with the Trump administration and TikTok’s US ban. Here’s what Cramer said in September:
“You’re going to hold Meta because it’s not expensive, believe it or not. It’s probably the least expensive of the mega caps, especially after what happened with Alphabet. Here’s what I would say: if it went down, let’s say 100 points, you should buy another 25 shares. I’m not advocating selling it right here because there’s too much in the pipeline that could be very good. We’re on a down day, and a lot of people freak out on down days. So, stay the course.”
META is a stock Jim Cramer talked about last year. While we acknowledge the potential of META as an investment, our conviction lies in the belief that some 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 META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
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