In this article, we’ll explore Jim Cramer’s 10 Best Stock Picks for Investors Right Now.
In a recent episode of Mad Money, Jim Cramer discussed how the slowing economy might lead the Federal Reserve to ease its policies. He expects the Fed to cut interest rates, but it’s unclear whether the reduction will be 25 or 50 basis points. This decision is crucial as it could significantly impact the market.
“At last, the economy has slowed enough that the Fed can take its foot off the brakes and step on the gas. That’s why we’re starting our game plan in the middle of next week when the Federal Reserve renders its verdict: 25 or 50 basis points. We don’t typically have a lot of drama in this business, but this one counts as a nail-biter because we really don’t know how big the rate cut will be. We just know they’re going to cut.”
Cramer pointed out that Friday’s market performance was strong, with the Dow gaining 297 points, the S&P rising by 0.54%, and the Nasdaq increasing by 0.65%. This marked the best two weeks of the year for the S&P and the Nasdaq, suggesting that the market might be anticipating a larger rate cut of 50 basis points. Stocks sensitive to interest rates, particularly in housing, surged in response.
“Today’s rally saw the Dow gaining 297 points, the S&P advancing 0.54%, and the Nasdaq climbing 0.65%, capping off the best two weeks of the year for both the latter two indices. The S&P and the Nasdaq suggest the Fed might actually go for 50. That’s a double rate cut. I know this because the stocks most sensitive to interest rates, particularly housing and housing-related names, soared today.”
Cramer also cautioned that if the housing market rally continues, it could lead to a sell-off if only a 25 basis point cut is announced. He pointed out that traders are currently pricing in a higher chance of a 50 basis point cut, according to the CME Group’s FedWatch tool. If the Fed opts for a smaller cut, traders who bought in anticipation of a larger reduction might sell off their stocks, potentially causing market volatility.
“To use a little NFL fantasy football lingo, they soared presumably in anticipation of something huge from Jay Powell and company. All aboard! I still find myself betting on a quarter-point cut, though. It’s not that we don’t need a half-point cut, as the economy is slowing pretty quickly, especially for the lower-income cohort. However, I’ve always believed that the Fed should be measured when it cuts rates at this stage of the business cycle.
The biggest risk is that inflation might flare up again if you cut too much, and a 50 basis point cut all at once makes that a lot more likely. Plus, a double rate cut signals that something may be very wrong with the economy—something we don’t know about, something lurking. So going for 50 could inspire panic, and there’s simply no reason for the Fed to take that chance when it can simply hit us with a series of thoughtful 25 basis point cuts that neither reignite inflation nor cause panic.”
Jim Cramer warned that if the housing market rally keeps going, it might lead to a sell-off if the Federal Reserve announces only a 25 basis point rate cut. If the Fed delivers a smaller cut, traders who anticipated a bigger reduction might start selling their stocks, which could lead to increased market volatility.
“Now, if the housing rally continues at this pace, these stocks run the risk of being too hot to handle for a mere 25 basis point cut, and we’ll get a sell-off in response. Keep in mind how the CME Group’s FedWatch tool, which tracks interest rate expectations based on the Fed Funds Futures Market, indicates that traders are now pricing in a much higher probability of a double rate cut, currently at 45%. That’s much higher than it was a week ago. These traders could indeed be disappointed if the Fed decides to be more measured. They could be your enemy come Wednesday at 2 p.m. as they dump what they bought incorrectly, and that is what happens. That’s what traders do, they let the stocks go.”
Finally, Jim Cramer believes that this week is critical for the market. He advised that if the market declines after a 25 basis point cut, investors should remember the strong performance of the past week. This week’s gains could be a sign of more positive developments as the Federal Reserve continues to ease its monetary policy.
“When I look at next week, I can only conclude that we’re finally at the moment we’ve all been waiting for. So let me give you the bottom line: if we sell off on a 25 basis point rate cut, remember this phenomenal week, because there will be plenty more like it as the easing process continues and progresses.”
Our Methodology
This article summarizes a recent post of Jim Cramer’s Morning Thoughts, where he discussed various stocks. We’ve selected and examined the ten most notable companies he mentioned and ranked them based on their ownership levels by hedge funds, from least owned to 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).
Must-See: Jim Cramer’s 10 Best Stock Picks for Investors Right Now
10. Ollie’s Bargain Outlet Holdings Inc. (NASDAQ:OLLI)
Number of Hedge Fund Holders: 27
Jim Cramer explained his ongoing concerns about Nike (NYSE:NKE) by pointing out a recent example from Ollie’s Bargain Outlet Holdings Inc. (NASDAQ:OLLI). The store’s new flyer features an “Activewear Blowout,” with items like a Puma hoodie, a unisex jacket, and a micro fleece pullover priced at $14.99, compared to Nike (NYSE:NKE)’s similar items that can cost up to $67.99.
“Here’s why I continue to dislike Nike: Ollie’s Bargain Outlet new flier has an “Activewear Blowout,” Puma hoodie, unisex jacket and micro fleece pullover for $14.99 versus “theirs” up to $67.99.”
Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI) offers a strong investment opportunity due to its impressive financial performance and strategic position in the value retail market. In Q2 2024, Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI)’s saw a 12.4% increase in net sales year-over-year, reaching $578.4 million, and a 5.8% rise in comparable store sales, marking nine consecutive quarters of growth.
Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI)’s earnings per share of $0.79 surpassed expectations, showcasing its operational efficiency despite inflationary pressures.Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI)’s plans to open 50 new stores in fiscal 2024, capitalizing on its ability to source discounted closeout inventory. This expansion is backed by effective expense management and rising demand for bargain-priced goods.
With Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI) raising its fiscal year guidance and analysts, including Goldman Sachs, increasing their price target to $115, Ollie’s is well-positioned to benefit from the growing trend toward value retail. Strong customer loyalty and continued store growth further enhance Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI)’s attractiveness as an investment with a promising outlook.
9. Walgreens Boots Alliance Inc. (NASDAQ:WBA)
Number of Hedge Fund Holders: 35
Jim Cramer reported that TD Cowen has noted Walgreens Boots Alliance Inc. (NASDAQ:WBA) is falling behind on its restructuring efforts. Walgreens Boots Alliance Inc. (NASDAQ:WBA) plans to close 2,000 underperforming locations, but so far only 1,000 have been shut down. The process of closing these stores has turned out to be more challenging than initially expected.
“TD Cowen said the restructuring of Walgreens Boots Alliance is behind schedule. The drugstore and pharmacy chain is trying to close 2,000 underperforming locations. So far, only 1,000 have been actually closed as it proves harder to shutter underperformers than previously thought.”
Walgreens Boots Alliance Inc. (NASDAQ:WBA) presents a strong investment opportunity due to its strategic growth in healthcare services, solid retail pharmacy performance, and robust international expansion. Walgreens Boots Alliance Inc. (NASDAQ:WBA) is significantly increasing its presence in healthcare through VillageMD and Shields Health Solutions, which contributed to a 7.6% revenue increase in its U.S. Healthcare segment. VillageMD’s expansion enhances Walgreens Boots Alliance Inc. (NASDAQ:WBA)’s role in primary care.
In retail, despite challenges, the U.S. pharmacy business has shown resilience, with a 4.4% year-over-year sales increase driven by prescription growth and higher branded drug prices. Internationally, Walgreens Boots Alliance Inc. (NASDAQ:WBA)’s Boots UK segment is performing well, with a 6.0% rise in comparable retail sales and a 13.8% boost in online sales.
Walgreens Boots Alliance Inc. (NASDAQ:WBA) is also managing cost pressures effectively and improving profitability through ongoing cost-cutting measures, achieving positive EBITDA in its healthcare segment. Walgreens Boots Alliance Inc. (NASDAQ:WBA)’s high dividend yield of around 5% and its perceived undervaluation make it attractive to income-focused investors. As Walgreens Boots Alliance Inc. (NASDAQ:WBA) continues to shift towards healthcare and leverage its international growth, it offers a compelling long-term investment opportunity with the potential for further gains if earnings forecasts improve.
Ariel Appreciation Fund stated the following regarding Walgreens Boots Alliance, Inc. (NASDAQ:WBA) in its Q2 2024 investor letter:
“Alternatively, shares of retail drugstore operator, Walgreens Boots Alliance, Inc. (NASDAQ:WBA), underperformed following an earnings miss and significant reduction to full year guidance, largely due to continued weakness in its U.S. retail business. In response, management announced a multi-year plan for the U.S. business to reduce the retail footprint, invest in the customer experience, align the retail and healthcare businesses for enhanced go-to-market capabilities and simplify the healthcare portfolio.
Meanwhile, the company continues to execute on its cost savings initiatives to optimize profitability and is using excess capital to prioritize the sustainability of its operations and balance sheet. Over the medium-term, we expect a re-rating in shares as WBA’s new CEO rebuilds the leadership team and earns credibility by executing on previously articulated strategic imperatives as well as margin.”
8. Moderna Inc. (NASDAQ:MRNA)
Number of Hedge Fund Holders: 39
Jim Cramer reported that Moderna Inc. (NASDAQ:MRNA)’s shares fell by 10% after the company announced it would cut costs by $1.1 billion. Along with this, Moderna Inc. (NASDAQ:MRNA) revealed plans to launch 10 new products by 2027. Moderna Inc. (NASDAQ:MRNA) is navigating challenges as its Covid vaccine business declines. Moderna Inc. (NASDAQ:MRNA)’s second commercially available product, RSV vaccines for seniors, was approved four months ago.
“Moderna shares dropped 10% after the biotech announced $1.1 billion in cut costs. It also announced plans for 10 new products by 2027. Moderna is trying to figure out the future as its Covid vaccine business rapidly declines. The company’s second commercially available product, RSV shots for seniors, was approved four months ago.”
Moderna, Inc. (NASDAQ:MRNA) presents a strong investment case due to its promising vaccine pipeline, progress in cancer treatment, and solid financial position. Moderna, Inc. (NASDAQ:MRNA)’s technology is expanding beyond COVID-19 vaccines. Notable developments include a next-generation COVID-19 vaccine (mRNA-1283), a successful Phase 3 trial for a combined flu and COVID-19 vaccine, and FDA approval for its RSV vaccine.
Moderna, Inc. (NASDAQ:MRNA)’s collaboration with Merck & Co., Inc. (NYSE:MRK) on mRNA-based cancer treatments, like the melanoma therapy mRNA-4157, also shows potential for new revenue streams. Even though Moderna Inc. (NASDAQ:MRNA) has faced a decline in COVID-19 vaccine sales this year, it remains financially healthy, with expected cash and investments around $9 billion by year-end. This strong financial base supports continued research and growth.
Analysts are optimistic, forecasting Moderna Inc. (NASDAQ:MRNA) could reach between $70 and $105. Overall, despite current short-term challenges, Moderna, Inc. (NASDAQ:MRNA)’s long-term potential in vaccines and therapeutics makes it a compelling investment.
7. e.l.f. Beauty, Inc. (NYSE:ELF)
Number of Hedge Fund Holders: 40
Jim Cramer reported that TD Cowen significantly lowered its price target for e.l.f. Beauty, Inc. (NYSE:ELF), reducing it from $235 to $150 per share. This adjustment comes as e.l.f. Beauty, Inc. (NYSE:ELF)’s stock has dropped by 42% over the past three months. Cramer also noted that the cosmetics industry has become increasingly contentious.
“TD Cowen took an axe to its price target on Elf Beauty, going to $150 a share from $235. The stock has cratered 42% over the past three months. What a controversial area the cosmetics industry has become.”
e.l.f. Beauty, Inc. (NYSE:ELF) offers a strong investment opportunity due to its impressive financial performance, strategic growth efforts, and market expansion. In Q1 FY2025, e.l.f. Beauty, Inc. (NYSE:ELF) reported an earnings per share (EPS) of $0.87, exceeding expectations by $0.20, and achieved a 71.4% increase in revenue year-over-year, reaching $321.1 million. This growth was driven by both organic improvements and the successful acquisition of the skincare brand Naturium, helping e.l.f. surpass $1 billion in annual sales for the first time.
e.l.f. Beauty, Inc. (NYSE:ELF) is also increasing its market share in color cosmetics and has raised its fiscal 2025 outlook. e.l.f. Beauty, Inc. (NYSE:ELF)’s innovation, expanded retail partnerships, and effective digital marketing strategies aimed at younger consumers support this positive outlook. Analysts predict a 31.6% increase in EPS next year, highlighting e.l.f. Beauty, Inc. (NYSE:ELF)’s strong potential for long-term growth.
ClearBridge Multi Cap Growth Strategy stated the following regarding E.l.f. Beauty, Inc. (NYSE:ELF) in its first quarter 2024 investor letter:
“In consumer sectors, we added Tractor Supply Company and E.l.f. Beauty, Inc. (NYSE:ELF). ELF, in the consumer staples sector, is the third-largest mass cosmetics brand in the U.S. We believe the flywheel of ELF’s consumer value proposition, its innovation pipeline, and its unique ability to bring prestige-like products to mass consumers and high consumer engagement will enable the company to continue to outgrow the global market.
We see significant opportunity for ELF to transform itself from an emerging U.S. color cosmetics brand to a global beauty stalwart by doubling its share in the U.S. over the next few years and gaining share in international and skincare markets. ELF is profitable, balancing growth and earnings, and has an attractive balance sheet.”
6. Palantir Technologies Inc. (NYSE:PLTR)
Number of Hedge Fund Investors: 44
Jim Cramer highlighted that Citi noted Palantir Technologies Inc. (NYSE:PLTR) as one of the priciest companies in the software sector but remained optimistic about its artificial intelligence initiatives. Despite this, Cramer described Palantir Technologies Inc. (NYSE:PLTR) as somewhat opaque or hard to fully understand. However, Palantir Technologies Inc. (NYSE:PLTR)’s recent addition to the S&P 500 has led to a significant boost, with shares rising more than 15%.
“Citi pointed out that Palantir is one of the most expensive names in software but remained bullish on its AI push. To me, the whole company is one big black box. Palantir’s inclusion into the S&P 500 this week has been good for more than a 15% jump in shares.”
Palantir Technologies Inc. (NYSE:PLTR) offers a strong investment opportunity due to its impressive financial performance, growth driven by AI, and strategic market positioning. In Q2 2024, Palantir Technologies Inc. (NYSE:PLTR) reported a 27% increase in revenue year-over-year, reaching $678 million, and earned $134 million in net income, marking its fourth consecutive profitable quarter. Palantir Technologies Inc. (NYSE:PLTR) saw a 55% rise in U.S. commercial revenue, driven by high demand for its Foundry software and AI solutions.
Palantir Technologies Inc. (NYSE:PLTR)’s Artificial Intelligence Platform (AIP) has been a major growth driver, prompting the company to raise its annual revenue forecast to $2.74–$2.75 billion. Its diverse revenue sources, including commercial and government contracts, reduce reliance on any single sector. Palantir Technologies Inc. (NYSE:PLTR)’s recent addition to the S&P 500, which boosted its stock price by 12%, is likely to attract institutional investors and increase market confidence.
Furthermore, its partnership with Microsoft (NASDAQ:MSFT)’s Azure enhances its AI and cloud capabilities, particularly in national security. Despite its high valuation, Palantir Technologies Inc. (NYSE:PLTR)’s innovative growth and strong financials suggest a positive long-term outlook for the stock.
5. Coterra Energy Inc. (NYSE:CTRA)
Number of Hedge Fund Holders: 48
Jim Cramer reported that JPMorgan has lowered its price target for several energy stocks, including Coterra Energy Inc. (NYSE:CTRA), which is the Investing Club’s only oil and natural gas holding. The new target for Coterra Energy Inc. (NYSE:CTRA) is $26 per share, down from $31, due to falling crude oil and natural gas prices and worries about increased OPEC+ supply. Despite this adjustment, JPMorgan has kept its overweight rating on Coterra Energy Inc. (NYSE:CTRA).
“JPMorgan cuts price targets on a host of energy stocks, including Coterra, our lone oil and natural gas Club holding. The analysts went to $26 per share from $31, citing declines in both crude and nat gas prices. There’s concern about more OPEC+ supply. JPMorgan maintained its overweight rating on Coterra.”
Coterra Energy Inc. (NYSE:CTRA) presents a strong investment opportunity due to its solid operational performance, positive outlook for natural gas, and disciplined capital management. In its latest earnings report, Coterra Energy Inc. (NYSE:CTRA) reported $1.27 billion in revenue and an earnings per share (EPS) of $0.37, demonstrating effective operations with production of 647 MBoepd.
Although there were minor revenue misses, Coterra Energy Inc. (NYSE:CTRA)’s full-year production forecast remains stable, with capital expenditures expected to be between $1.75 and $1.95 billion. Coterra Energy Inc. (NYSE:CTRA) is well-positioned to benefit from the increasing demand for natural gas, driven by growing LNG exports and global energy shifts. Its diversified assets in the Permian Basin and Marcellus Shale enhance its growth potential.
Additionally, Coterra Energy Inc. (NYSE:CTRA)’s $0.21 per share quarterly dividend and low-cost operations strengthen investor confidence. Analysts are optimistic, with many giving “buy” or “overweight” ratings and raising price targets. Overall, Coterra Energy Inc. (NYSE:CTRA)’s stable production, effective capital management, and favorable natural gas market conditions support a strong positive outlook for the stock.
4. Lennar Corporation (NYSE:LEN)
Number of Hedge Fund Holders: 60
Jim Cramer mentioned that Lennar Corporation (NYSE:LEN), a well-known home builder, is set to report its earnings the day after the Federal Reserve’s meeting. This timing could provide valuable insights. Cramer believes Lennar Corporation (NYSE:LEN) will present a strong performance, and if the Fed announces a 50 basis point rate cut, Lennar’s stock might become an excellent investment opportunity.
“Lennar, a classic home builder, will report a day after the Fed meeting, which could be very enlightening. I think Lennar will tell a terrific story, and if we get a 50 basis point cut, its stock might be a terrific place to be.”
Lennar Corporation (NYSE:LEN) offers a strong bullish outlook based on its solid financial results and its ability to take advantage of current housing market conditions. In Q3 2024, Lennar Corporation (NYSE:LEN) outperformed expectations with earnings per share of $3.91, compared to the expected $3.52, and revenue of $8.73 billion, surpassing the forecasted $8.43 billion. This growth was driven by a 5% increase in home deliveries and healthy gross margins of 23.1%, highlighting Lennar Corporation (NYSE:LEN)’s ability to stay profitable even with rising interest rates.
Lennar Corporation (NYSE:LEN)’s focus on affordable housing, a key need in the U.S. due to a housing shortage, has positioned it well in the market, especially as higher mortgage rates push buyers toward lower-cost homes. Lennar Corporation (NYSE:LEN)’s success is also supported by its ability to manage costs and adjust to regional demand, thanks to its strategic geographic diversification.
Additionally, Lennar Corporation (NYSE:LEN)’s plan to spin off its multifamily unit and its ongoing share buyback program show management’s confidence in future growth and commitment to returning value to investors. Backed by a strong balance sheet and continued investment in land and communities, Lennar Corporation (NYSE:LEN) is set to benefit from ongoing housing demand, making it an attractive investment opportunity.
3. T-Mobile US Inc. (NASDAQ:TMUS)
Number of Hedge Fund Investors: 67
Jim Cramer reported that Wells Fargo has increased its price target for T-Mobile US Inc. (NASDAQ:TMUS) shares from $200 to $230 and maintained its overweight rating. The bank’s analysts pointed to price increases and substantial free cash flow as reasons for the upgrade. T-Mobile US Inc. (NASDAQ:TMUS), along with Verizon (NYSE:VZ) and AT&T (NYSE:T), is also offering promotions on Apple’s new iPhone 16, which is expected to drive a strong upgrade cycle powered by AI advancements.
“Wells Fargo raised its T-Mobile price target to $230 per share from $200 and kept its overweight rating. The analysts cited prices increases and huge free cash flow. T-Mobile, like Verizon and AT&T, is offering deals on Apple’s new iPhone 16, in what’s expected to be a robust AI-driven device upgrade cycle.”
T-Mobile US Inc. (NASDAQ:TMUS) presents a strong investment case due to its leadership in 5G technology, impressive customer and revenue growth, and solid financial performance. T-Mobile US Inc. (NASDAQ:TMUS) stands out in the 5G market by offering the fastest speeds and the widest coverage in the U.S., which helps retain and attract customers. In Q2 2024, T-Mobile US Inc. (NASDAQ:TMUS) added 406,000 high-speed internet customers, surpassing its competitors and showing high demand. T-Mobile US Inc. (NASDAQ:TMUS) expects to add 5.4-5.7 million postpaid customers by year-end.
Financially, T-Mobile US Inc. (NASDAQ:TMUS) experienced a 54% increase in free cash flow year-over-year, reaching $4.4 billion, which has enabled substantial share buybacks and dividends, with $3 billion returned to shareholders so far in 2024. T-Mobile US Inc. (NASDAQ:TMUS) also raised its free cash flow forecast to $16.6-$17 billion, highlighting its strong cash generation and investor returns. With stock prices over $200 and analysts setting target prices around $228, T-Mobile US Inc. (NASDAQ:TMUS) financial strength, network leadership, and focus on shareholders make it an attractive investment in the telecom sector.
2. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 100
Jim Cramer highlighted that JPMorgan has increased its price target for Eli Lilly and Company (NYSE:LLY) shares from $1,050 to $1,100. This adjustment reflects anticipated developments for Eli Lilly and Company (NYSE:LLY)’s rapidly growing obesity drug business. JPMorgan has also maintained its buy-equivalent rating on the stock, which is part of the Investing Club’s portfolio.
“JPMorgan nudged up its Eli Lilly price target to $1,100 a share from $1,050 ahead of what analysts see as looming catalysts for its fast-growing obesity drug franchise. The firm kept its buy-equivalent rating on the Club stock. On Thursday, the drugmaker announced more investment to expand manufacturing capacity for obesity drugs as well as its recently FDA-approved Alzheimer’s therapy.”
Eli Lilly and Company (NYSE:LLY) presents a strong investment opportunity, bolstered by its impressive Q2 2024 earnings. Eli Lilly and Company (NYSE:LLY) saw a 36% increase in revenue year-over-year, reaching $11.3 billion, driven mainly by its diabetes and obesity treatments, with Mounjaro leading the way. Eli Lilly and Company (NYSE:LLY) also raised its revenue forecast for 2024 to between $45.4 billion and $46.6 billion, reflecting confidence in its promising drug pipeline. This includes new treatments for obesity, diabetes, and cancer. Analysts share this positive outlook, with target prices around $1,060, indicating strong market confidence in the company’s future growth.
Baron Health Care Fund stated the following regarding Eli Lilly and Company (NYSE:LLY) in its Q2 2024 investor letter:
“Shares of global pharmaceutical company Eli Lilly and Company (NYSE:LLY) increased on continued investor enthusiasm around GLP-1 drugs for diabetes and obesity. We remain shareholders. Lilly’s Mounjaro/Zepbound not only offers superb blood sugar control for diabetics but can drive 20%-plus weight loss and likely improve cardiovascular outcomes in both diabetic and non-diabetic obese patients.
Lilly is developing next generation drugs, including retatrutide, which drives approximately 25% weight loss, and orforglipron, a daily pill that produces approximately 15% weight loss. In the U.S. alone, there are 32 million Type 2 diabetics and an additional 105 million obese patients who we estimate would qualify for GLP-1 drugs.
Although supply and access are limited near term, we think GLP-1 drugs will become standard of care for both diabetes and obesity and will become a $150 billion-plus category. We see Lilly setting a high efficacy bar and capturing significant long-term market share. We think the adoption of GLP-1s will drive Lilly to triple total revenue by 2030.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Investors: 179
Jim Cramer noted that Wall Street is expected to build on Wednesday’s strong performance, following a midday reversal. On the previous day, NVIDIA Corporation (NASDAQ:NVDA) CEO Jensen Huang boosted the market by highlighting high demand for Nvidia’s AI chips and promoting the company’s bright outlook. NVIDIA Corporation (NASDAQ:NVDA), a long-standing member of the Investing Club’s portfolio, will be a topic of discussion at the September Monthly Meeting, starting at noon ET.
At a Goldman Sachs conference, Huang described the demand for NVIDIA Corporation (NASDAQ:NVDA)’s upcoming Blackwell chip platform as extremely high, with many eager to be the first to get it. This led to NVIDIA Corporation (NASDAQ:NVDA)’s shares rising 8% during the session.
“Wall Street on Thursday is on track to extend Wednesday’s robust gains following an intraday reversal. Nvidia CEO Jensen Huang ignited the market in the prior session after talking up demand for its AI chips and touting the company’s bright future. We’ll discuss Nvidia, a longtime Club holding, and the rest of our Investing Club portfolio at our September Monthly Meeting, which kicks off at noon ET.
Demand for Nvidia’s next-generation Blackwell chip platform is “so great, and everybody wants to be first,” Jensen said at a fireside chat at a Goldman Sachs conference Wednesday. Shares soared 8% in that session. Jensen also made a compelling case that the value proposition of AI chips overwhelmingly favors Nvidia, something that really resonated with us at the Club. Jensen’s comments were a real death rattle for Intel, by the way.”
NVIDIA Corporation (NASDAQ:NVDA) is a strong investment prospect due to its leadership in AI and GPU markets, rapid revenue growth, and advancements in computing technology. In its latest earnings report, NVIDIA projected over 107% year-over-year revenue growth, potentially reaching $28.6 billion in fiscal Q2 2024. Analysts are bullish on the stock, with firms like Evercore ISI and Wedbush forecasting a potential 20% increase in its price.
NVIDIA’s dominant market share of 70-80% in AI chips, along with its growing footprint in cloud gaming and data centers, positions it for sustained growth. With an expected annual growth rate of 38% over the next five years, the company’s revenue could climb to $108 billion by 2026. This growth is largely driven by its leadership in AI hardware, a market expected to expand to $300 billion annually by 2027. The combination of market dominance and strong future demand makes NVIDIA a highly attractive investment.
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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