We recently published a list of Was Jim Cramer Right About These 12 Stocks? In this article, we are going to take a look at where Nvidia (NASDAQ:NVDA) stands against other stocks that Jim Cramer discussed 6 months ago.
Back in July, Cramer was talking about the market’s turbulence which was driven by a rotation out of large-cap tech stocks and into small-cap stocks. He said:
“This rotation has been agonizing for anyone who’s stuck with the long-standing winners, including today, but it’s Nirvana for those who dived into the losers, the worst performing stocks, the ones that are buried in the Russell 2000 and the S&P 600 small cap index.”
Cramer suggested that this “change in market leadership” began on July 11, following the release of a “cooler than expected” CPI report. Cramer also talked about key events that further propelled this change in the markets, such as Donald Trump becoming the frontrunner for the U.S. presidential elections and then doubling down on his protectionist economic stance by selecting J.D. Vance as his running mate, a move that was seen as “incredibly hostile towards companies that move their manufacturing overseas”.
The rotation from large-cap tech to small-cap was exacerbated due to Trump’s comments where he questioned whether it was worth defending Taiwan from China. These remarks specifically hit Nvidia at the time, due to the company’s reliance on Taiwan for advanced semiconductor manufacturing.
Cramer expressed his concerns about the U.S. government policies regarding semiconductors labelling them as “the heart of computing and artificial intelligence” at the time. Former U.S. Secretary of Commerce Gina Raimondo also joined his show six months ago and discussed semiconductors, as the Mad Money host was worried about escalating tensions between the U.S. and China back then.
Throughout the episode, Cramer examined a variety of stocks and industries, providing bullish or bearish perspectives on their performance and potential. For this article, we went over all of the stocks that Jim Cramer talked about during his program on CNBC and how they fared since the episode aired.
Our Methodology
For this article, we compiled a list of 12 stocks that were discussed by Jim Cramer during the episode of Mad Money on July 26, 2024. We then calculated their performance from July 26, 2024, market close to January 28, 2025, market close. We have also included the hedge fund sentiment for the stocks, which we sourced from Insider Monkey’s Q3 2024 database of over 900 hedge funds. The stocks are listed in the order that Cramer mentioned them.
Why are we interested in 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).
Nvidia Corp (NASDAQ:NVDA)
Number of Hedge Fund Investors: 195
Jim Cramer and Secretary of Commerce Gina Raimondo discussed Nvidia’s heavy reliance on Taiwan for the production of its advanced AI chips. With geopolitical risks increasing, Nvidia’s dependence on Taiwan Semiconductor Manufacturing Company (TSMC) was framed as a major vulnerability. Raimondo said:
“93% of our chips come from one company in Taiwan… every single AI chip that Nvidia designs is made in Taiwan.”
Cramer highlighted the potential disruption of Nvidia’s supply chain and the market’s skepticism about AI investments:
“Wall Street began to question the future of artificial intelligence, doubting whether all these big data centers are ever going to pay off.”
Although Raimondo reassured that Nvidia only exports chips to China with government approval, Cramer seemed bearish on Nvidia.
Nevertheless, the stock is up 15% since then.
Overall, NVDA ranks 12th on our list of stocks that Jim Cramer discussed 6 months ago. While we acknowledge the potential of NVDA 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 NVDA 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 is originally published at Insider Monkey.