CNBC’s Jim Cramer said Tuesday that the best way to capitalize on the artificial intelligence boom is with existing tech giants, which have multiple opportunities to leverage the technology.
The “Mad Money” host acknowledged concerns about AI’s overestimation and comparisons to the dot-com bubble. Kramer said he favors blue-chip companies with strong operations and management teams that can find new ways to benefit from AI, rather than exiting the trades that continue to drive much of the market’s profits.
“I want to stick with the AI data center effort because I think a lot of things can go right,” Kramer said.
he pointed to Meta and microsoft As two examples. Mr. Kramer’s CNBC Investment Club owns both shares.
Meta stock has had a rocky start to 2026, but Cramer said he trusts CEO Mark Zuckerberg and his team to figure out a way to monetize AI spending, and the Facebook and Instagram parent company is expected to do that with Muse. The stock is currently trading around $738.
“I didn’t think, ‘What a bunch of chowderheads, they don’t have any AI,'” Kramer said. “Mark Zuckerberg and his Dream Team are brilliant and I knew they would figure something out.”
Cramer had a similar view of Microsoft in June, when the stock traded at a 52-week low of $350. Despite expressing dissatisfaction with the stock’s performance at times, Mr. Cramer said, “I didn’t think the best was behind us.” But in the end, Kramer retained his stake in the club because he believed in the veteran leadership team of CEO Satya Nadella and CFO Amy Hood.
“I thought, ‘They’re going to figure this Copilot out and make a lot of money in the Azure web services business.'” The stock is currently trading around $529 as the market gains confidence in Microsoft’s Copilot plans. Azure’s results and outlook also beat Wall Street expectations in late July, leading to a rise in the stock price.
Mr. Kramer also emphasized advanced micro device and intel In semiconductors, marvel technology chips and fibers, and cloud strike and palo alto networks in cyber security.
The strategy is particularly attractive to Mr. Cramer because rising interest rates make growth elsewhere difficult. In contrast, AI companies are among the relatively few that can continue to grow strongly in this environment, he said.
“About 80% of queries S&P500 Most people have no idea what would work,” Kramer said. “Certainly, that may change once the war is over, but until then, AI stocks offer the best chance for something to work out.”
However, this does not mean that AI trading is without risks. Kramer acknowledged that enthusiasm could be overblown. He also emphasized that, regarding the investment club’s portfolio, “I want to be diversified, and I certainly run a diversified portfolio.”
Cramer’s Charitable Trust, a portfolio managed by CNBC’s Investment Club, owns shares in META, MSFT, INTC, CRWD, and PANW.
