In this piece, we will look at the stocks Jim Cramer recently discussed.

In his recent appearance on CNBC’s Squawk on the Street, Jim Cramer spent nearly all of the show either discussing stocks or the changed environment for AI data center stocks after the DeepSeek selloff. During the selloff, Wall Street’s favorite AI GPU stock lost close to $600 billion in market capitalization. Since then, AI data center investors have been greeted with several optimistic earnings call announcements that counter the narrative of DeepSeek leading to lower AI data center capital expenditure and lower demand for its products.

Since the selloff though, the stock still hasn’t risen to its former glory. While it dropped by 17% during the day and has gained 12.5% since then, the shares are still down by 6.6%. The shares appear to have regained some of their value due to growing evidence showing that the demand for AI chips still exists.

The rise is also relevant when we consider Cramer’s remarks in the selloff’s immediate aftermath. Back then, the CNBC host had outlined that he was watching two key metrics to determine the fate of the AI stock According to Cramer, the first metric is energy spending. Investors have piled into nuclear energy stocks due to the industry’s demand for clean energy to power gigawatt data centers. Cramer believes that any drawdown in energy spending or a slowdown of plans such as those to revive the Three Mile Island nuclear reactors could signal a paradigm shift in AI data center investing.

The second metric is GPU orders. On this front, earnings calls from big tech firms have painted an optimistic picture as no firm has significantly reduced their expenditure. Yet, Cramer had cautioned back then “But that’s not, necessarily, what people are going to announce, ‘listen, I’ve decided. . . If this thing only needs one-tenth of the power, one-tenth of the compute, well I’m going to cut my orders by nine-tenths.’ I’ve not heard that yet, but this thing is. . . a steamroll.”

While capital expenditure spending by big tech for data centers is an estimate of future capital outlays, a similar metric is the revenue earned by chip manufacturers. On this front, the world’s largest contract chip manufacturer based in Taiwan announced in February that it had earned a cool $8.93 billion in January to mark an impressive 39% annual growth. This revenue is from chips that will ship later this year, and it presented investors with insight into semiconductor demand immediately after the DeepSeek selloff. Although, granted that these orders were likely made before the selloff, the shares of the AI GPU stock jumped by 2.7% on the news.

During his show, Cramer shared details of a website that he came across. He outlined “Now there’s an outfit that I’ve been dealing with called you dot com. . . .I really like you dot com. It’s one of those companies that is really ahead of DeepSeek, it’s way ahead,” he shared. Cramer’s initial takeaway was that You.com’s advantage could hurt the GPU company. But, when he dug deeper, he found that the GPU company was actually one of the website’s biggest investors.”

Commenting on this discovery, he outlined “Once again you just find this, the long knives came out, whether it be China or whether it be Biden or whether it be these big hyperscalers, that said listen we don’t want [to buy the GPU company’s stock], we wanna scale back in [the stock] and then something happened which just said, you know, I guess we can’t.”

Our Methodology

To make our list of the stocks that Jim Cramer talked about, we listed down the stocks he mentioned during CNBC’s Squawk on the Street aired on February 5th.

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).

10. PDD Holdings Inc. (NASDAQ:PDD)

Number of Hedge Fund Holders In Q3 2024: 78

PDD Holdings Inc. (NASDAQ:PDD) is a Chinese eCommerce company that is a new entrant in the domestic and international industries. Its shares are down by 11.6% over the past year as the firm has been beset by one set of bad news followed by another. PDD Holdings Inc. (NASDAQ:PDD)’s stock sank by 36% in August after the firm warned investors about a slow Chinese economy impacting its revenue. While the shares recovered soon after that, they slipped by 8.8% this year after President Trump’s tariffs against China. Here is what Cramer said about PDD Holdings Inc. (NASDAQ:PDD):

“We don’t seem to know, we don’t have a handle on what to do with PDD.”

“They’re social. Have you been hit by the Temu box. Like my daughter does some social. She suddenly gets two hundred dollars worth of Temu stuff. You know it arrives.”

9. Merck & Co., Inc. (NYSE:MRK)

Number of Hedge Fund Holders In Q3 2024: 86

Merck & Co., Inc. (NYSE:MRK) is a global pharmaceutical giant whose revenue depends on its cancer and HPV vaccines. The two account for more than 70% of the firm’s sales and any weakness for either means that the stock struggles. Merck & Co., Inc. (NYSE:MRK)’s HPV drug GARDASIL is facing a sales slowdown in China due to regulatory crackdowns against doctors. In his previous remarks, Cramer commented that the firm heart drugs and other treatments are being overlooked by investors. Here are his recent comments about Merck & Co., Inc. (NYSE:MRK):

“[On MRK and EL] It’s funny you mention those two because of China. If you have China, then you are open for question. Because people say well wait a second, if you take a look at Merck, they really deny their people GARDASIL, which is a terrific vaccine and then you say wait a second maybe the vaccine problem is RFK Jr. Of Pfizer, I thought they had a good number. But what was going on there, RFK Jr. So you’ve got this kind of split, where the drug stocks are really getting hurt. It’s hard to get them moving. You do have this endless debate about how much people have to spend capex. Now we’ve heard it from almost everybody. But I think that in general when you get up in the morning and you see a sea of red, and you think everything’s going to get down, by the time you get here, you say to yourself, well wait a second, what really went wrong.”