We recently published a list of Jim Cramer’s Bold Predictions About These 12 AI Stocks. In this article, we are going to take a look at where Super Micro Computer, Inc. (NASDAQ:SMCI) stands against other AI stocks that Jim Cramer has made predictions about.
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.
“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?”
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 companiessoared 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).
Jim Cramer on Super Micro Computer, Inc. (SMCI): Why the Hindenburg Report Still Worries Him - Here’s Why
A team of technicians in a server room, testing and managing the newest server solutions.
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.”
Overall, SMCI ranks 12th on our list of AI stocks that Jim Cramer has made predictions about. While we acknowledge the potential of SMCI 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 time frame. If you are looking for an AI stock that is more promising than SMCI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
