On Thursday, Mad Money host Jim Cramer addressed growing concerns about market froth and advised the viewers not to let it push them out of the market entirely.
“This morning, listening to our network, I heard a fund manager blast this market because of all the froth. Our excellent anchor, Frank Holland, pressed her on the notion of froth, and she reiterated that the market was riddled with it. To which I say, if this is froth, bring it on. Honestly, this market really does have a lot of froth in it, something we see every day.”
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While Cramer did not deny the existence of froth, he questioned why it had not led to more significant damage. He noted that there are still enough fundamentally sound stories in the market to keep things grounded. He added:
“Is the widespread irrationality a reason to sell down your positions in perfectly rational stocks? Absolutely not.”
He acknowledged that he has referred to this year as one of “magical thinking,” where some speculative moves have gotten out of hand. But he argued that strong performance in speculative names often accompanies strength in legitimate companies, and one cannot expect rallies in the quality names without occasionally seeing the same in the more questionable ones.
“The bottom line: We are nothing like the end of 1999. We are nothing like March of 2000 when the dot-com bubble officially burst. So don’t quit the market because of quantum computing or jets and cars. We are still, in a word, rational.”
Our Methodology
For this article, we compiled a list of 7 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on August 14. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the first quarter of 2025, which was taken from Insider Monkey’s database of 1,000 hedge funds.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Jim Cramer on Market Rationality: 7 Stocks to Watch
7. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 77
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer called it “a talented company” and said:
“These skeptics want to understand crypto, but they can’t get their arms around it. They don’t get how there’s a consultant company that’s won over both the government and the private sector by saving them fortunes, like Palantir. This stock, more than any other, any quantum or nuclear, biotech is the one that truly rankles them. To me, that’s the most irrational view of all, not about Palantir, but about the view that they have. Palantir’s a talented company with a messianic leader who knows how to win big contracts. It’s just, it’s very hard… to value the stock. If you use traditional metrics like earnings per share, the valuation looks insane. But if you use the Rule of 40, the way we do on this show to judge enterprise software stocks, you can understand why this thing won’t stop running. It’s incredibly cheap. Palantir, rational? Let’s just say there’s no method to its madness.”
Palantir Technologies Inc. (NASDAQ:PLTR) develops software platforms that integrate, analyze, and manage complex data for intelligence, defense, and enterprise applications. The company’s products include Gotham, Foundry, Apollo, and an AI platform that supports data-driven decision-making and real-world operations.
6. Oklo Inc. (NYSE:OKLO)
Number of Hedge Fund Holders: 23
Oklo Inc. (NYSE:OKLO) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer said that the stock’s significant gains are because of a “pro-nuke” administration. He said:
“Oklo wants to build a small nuclear reactor that runs on nuclear waste. Love it. We need nuclear power, but it may take years to build, make that years and years, even if it’s a small-scale production. The stock’s up 247% year to date because this administration’s even more pro-nuke than the previous one. But man, it’s really hard to construct a nuclear reactor. The process takes forever, and the cost overruns are often endless. I’m not so sure why Oklo would be any different. Irrational.”
Oklo Inc. (NYSE:OKLO) develops advanced fission power plants to deliver clean and affordable energy at scale. In addition, the company focuses on nuclear fuel recycling technology that transforms waste into usable reactor fuel. Cramer mentioned the stock in a July episode and said:
“Until this market, I found it very hard to recommend anything… because historically, parabolic moves tend to explode in your face. But you know what? I violated my rule for this market simply because the moves are too big and the opportunities too frequent to pass on all of them. I don’t want you to miss making some big money because of a view that might no longer be relevant. Let’s take some stocks.
Take Oklo, okay. You might have seen them on TV today. Here’s a company that I’m asked about every couple of weeks, one that’s working on new nuclear technology. I felt that the stock’s parabolic run from $21 to $31 was just too steep for me, even as I’m a huge believer in nuclear. Finally, I switched my view and told people to buy it regardless of the parabola because it has just so much going for it. Today, Oklo announced an integrated power solution for data centers, might be worth billions to shareholders. It’s a turnkey solution no one else has. The stock has now doubled since I waived my parabola ban, doubled.”
5. D-Wave Quantum Inc. (NYSE:QBTS)
Number of Hedge Fund Holders: 13
D-Wave Quantum Inc. (NYSE:QBTS) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer said that betting on quantum computing is rational if you are betting for the long term, as he stated:
“Or take D-Wave Quantum. I think quantum computing could be a huge way to disrupt almost everything someday, a faster way to do high-performance computing for certain. Rational, assuming you’re betting on this technology for the long haul, but is anyone really doing that? When I listen to what D-Wave wants to do when they came on our show, which is pretty much everything, and how it’s gotten the money to do so, largely by selling… stock to the memesters who bid it up, I say irrational, frothy.”
D-Wave Quantum Inc. (NYSE:QBTS) develops quantum computing systems, cloud services, and software tools designed for real-time access and hybrid problem solving. The company’s technology is applied to areas such as logistics, scheduling, drug discovery, portfolio optimization, and industrial design.
4. Bullish (NYSE:BLSH)
Number of Hedge Fund Holders: N/A
Bullish (NYSE:BLSH) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer discussed the company’s during the episode, as he commented:
“But how about the froth we never stop hearing about?… Yesterday, an outfit called Bullish came public. I find that name in itself irrational. You don’t name a company bullish when a bear market could always be in the offing, and at some point, there will be a bear market. It’s like putting a target on your back. I know that Bullish is meant to be the institutional version of Coinbase, a cryptocurrency exchange for the big boys.
Of course, this kind of thing should have been done by a national bank; we all know. How about a JPMorgan? But uh-uh, they missed out. They were too worried about a future regulatory crackdown that never came. Call them not visionaries. Bullish had an explosive gain right out of the gate yesterday, and even though it pulled back from its highs, it rallied another 10% today.
Problem is, the documents indicate that Bullish plans to prioritize stablecoins on the Solana network, a cryptocurrency that few people use. Why? To make Solana go up because it wants the currency to be well-known. Who knows? Irrational. Bullish, the company is as frothy as it gets.”
Bullish (NYSE:BLSH) runs a digital asset exchange that combines order book trading with automated market making to provide liquidity. It also offers CoinDesk indices, market data, analytics, and a media platform covering crypto and blockchain.
3. The Charles Schwab Corporation (NYSE:SCHW)
Number of Hedge Fund Holders: 102
The Charles Schwab Corporation (NYSE:SCHW) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer discussed the company’s increase in net new assets, as he remarked:
“Charles Schwab announced a 17% increase in net new assets month over month. That’s an amazing gain, and it totally justifies the stock’s 2.3% move. Rational.”
The Charles Schwab Corporation (NYSE:SCHW) provides wealth management, brokerage, banking, asset management, custody, and financial advisory services. Its offerings include trading platforms, managed portfolios, banking products, retirement solutions, and trust services. Cramer discussed the stock in a July episode. He commented:
“Finally, don’t say I didn’t tell you so, we’ve been championing Charles Schwab from the days when the doubters cast dispersions on the balance sheet. That was 25 points ago. They’ve been silent of late. But I think the short sellers like to come out and color the opening of trading when Schwab opens. I say be very careful before you do some buying.”
2. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 119
Eli Lilly and Company (NYSE:LLY) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer discussed the stock purchases by insiders during the episode. He said:
“Or how about Eli Lilly? After that disappointing pill form of the GLP-1 drug, which didn’t cause enough weight loss, and the subsequent clubbing of Lilly’s stock, insiders started to buy the stock like crazy. CEO David Ricks and board member J. Erik Fyrwald, the CEO of IFF… bought $1 million worth each. Daniel Skovronsky, the chief scientific officer, he bought $634,000 worth, and Jacob Van Naarden, he’s president of Lilly Oncology… bought $647,000 worth.
These are not small amounts; they’re not painting the tape, so to speak. This is a big deal. To me, the insider buying says you should buy Eli Lilly, too. And I rerated the stock positively for my Charitable Trust in today’s monthly CNBC Investing Club meeting. Rational.”
Eli Lilly and Company (NYSE:LLY) develops and markets pharmaceuticals across diabetes, obesity, oncology, immunology, neuroscience, and other therapeutic areas.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 328
Amazon.com, Inc. (NASDAQ:AMZN) is one of the stocks to watch as Jim Cramer looked at market rationality. Cramer called the company “arguably the best retailer in the world,” as he commented:
“Today, we had a giant run in Amazon, up almost 3%. Why? It’s a follow on move from yesterday’s announcement that the company will be moving to same-day grocery delivery, which the analysts wrote about overnight. Now this is an incredibly disruptive initiative that was basically ignored yesterday. Given that delivery is free with Amazon Prime, it could spell real problems for Instacart, perhaps even DoorDash and Uber. Just as importantly, this announcement changed the narrative about Amazon.
You see, for the past two weeks, the story of Amazon was about how its AWS business had fallen behind Google Cloud and Microsoft Azure, its principal competitors, because it’s using its own slower chips instead of buying them from NVIDIA. It was a very damning storyline. This week, though, we remember that Amazon’s also a retailer, arguably the best retailer in the world. That’s rational, not frothy.”
Amazon.com, Inc. (NASDAQ:AMZN) sells consumer products, digital content, and subscriptions while also providing cloud computing, advertising, and entertainment services. The company develops devices like Kindle and Echo, supports third-party sellers and content creators, and operates the Amazon Prime membership program.
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