Insider Monkey
Broadcom’s (AVGO) AI Surge: Why Cramer Thinks It’s Just Getting Started
Syeda Seirut Javed
8 min read

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We recently compiled a list of the 7 Stocks that Jim Cramer Recently Discussed. In this article, we are going to take a look at where Broadcom Inc.’s (NASDAQ:AVGO) stands against the other stocks that Jim Cramer has recently discussed.

Jim Cramer, host of Mad Money, recently addressed how investors can sometimes lose sight of the broader market perspective. He reminded his audience that the key to successful investing is simple: buy good stocks at reasonable prices and sell poor-performing stocks, even at a loss.

“Sometimes we forget what we are trying to do around here. We’re looking to find good stocks at good prices and buy them. We want to sell bad stocks at any price and kick them out of our portfolio.”

Cramer also touched on the current market environment, noting that we're nearing the beginning of a rate-cutting cycle. While some may argue it’s not yet a cutting cycle, Cramer believes it is, regardless of whether it proceeds gradually. He pointed out that there’s another important factor to consider, an environment that is heavily oversold.

“We know that there are inflationary tariffs in the wind, but we don't know their size, their breadth or their impact, but that's why we're already oversold. People saw this coming, they were worried and they took action ahead. They dumped stocks so they wouldn't be long or own as much when the meeting (Fed meeting) occurred.”

READ ALSO: 6 Stocks Jim Cramer Talked About This Week and Jim Cramer’s Lightning Round: 7 Stocks to Watch.

As Cramer looked at the market, he expressed his focus on identifying high-quality stocks that have seen significant declines. He noted that, in a market that has already experienced substantial gains, the only place to find true value is among the laggards. Specifically, he pointed to the healthcare sector, where 62 healthcare stocks in the S&P 500 are currently down by an average of 19.7% from their peaks. Cramer acknowledged that some of this decline is tied to real risks within the sector, such as President-elect Trump's focus on addressing middlemen in the drug industry, including pharmacy benefit managers and drug distributors. However, he believes much of the risk has already been priced into these stocks, making them potentially attractive investments at this point.

Cramer also drew attention to the medical device and technology sector, where stocks are on average down 17.6% from their highs.

“Now the goal is to build a position that starts somewhere well below where it was, simply because it has gone out of style in the current version of the Wall Street fashion show and is being hit with heavy end-of-the-year tax selling… You know why you do this? Because of the overarching principle behind good investing, buying low so that one day you can sell high, or maybe not sell at all.”

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