In this article, we will look at the stocks on which Jim Cramer gave his opinion, as he warned that increased AI-related spending might cause near-term headwind for stocks. The host of CNBC’s Mad Money said on Wednesday that the surge in capital raising tied to the artificial intelligence boom may become a short-term obstacle for the stock market.
Bull markets can be killed by business conditions, interest rates, or geopolitical turmoil, but the thing that most easily leads them to the slaughterhouse is an excess of new supply, too many new shares, not enough buyers. Like any market, when supply outstrips demand, prices go right down as buyers get overwhelmed and they go home.
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Cramer did say that he does not fault companies for taking advantage of the opportunity to raise capital. He noted that if he were running a competing business, he likely would have done the same, if only to keep pace in an increasingly competitive environment. Still, he questioned whether investors have enough money available to support the growing number of initial public offerings and secondary stock offerings without putting pressure on the broader market and potentially pushing stocks to significantly lower levels.
Here’s the bottom line: Once we get through this period and we see that the buyers of NVIDIA’s wares are making fortunes, we’re home free. That will happen, or these companies wouldn’t be spending all that money in the first place. Until then, though, it’s a battlefield.
Our Methodology
For this article, we compiled a list of 13 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on June 3. We listed the stocks in the order that Cramer mentioned them.
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. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
Jim Cramer’s Opinion on 13 Stocks Like Eli Lilly and Boeing and Increased AI-Related Spending
13. Banco Santander, S.A. (NYSE:SAN)
Banco Santander, S.A. (NYSE:SAN) was among the stocks on which Jim Cramer gave his opinion, as he warned that increased AI-related spending might cause near-term headwind for stocks. Answering a caller’s question about the stock, Cramer said:
That was Ana Botín. I think the world of her. I know that the stock has had a big run. I think it’s paused here as it catches its breath. I don’t want people to sell it, and if it came back to $10, I’d tell people to buy it.
Banco Santander, S.A. (NYSE:SAN) provides banking, financing, investment, and insurance services to individuals, businesses, and public institutions. The company offers lending, wealth management, payments, and digital banking. During the May 5 episode, a caller inquired whether Cramer was still bullish on the stock and his thoughts on the Webster Bank acquisition. The Mad Money host replied:
Not only do I like the acquisition, but I thought it was so good that I actually wrote the chairman Ana Botín, saying that is some franchise because I owned it when I was a hedge fund manager 20 years ago. Buy Banco Santander.
12. Becton, Dickinson and Company (NYSE:BDX)
Becton, Dickinson and Company (NYSE:BDX) was among the stocks on which Jim Cramer gave his opinion, as he warned that increased AI-related spending might cause near-term headwind for stocks. When a caller mentioned that they had started a position in the stock, Cramer commented:
I like Becton, Dickinson. It is selling frankly at the lowest level to the market that I have ever seen. I think you buy some and then you wait to see if they even oversell it more. That stock is very inexpensive.
Becton, Dickinson and Company (NYSE:BDX) sells a variety of medical supplies, diagnostic tools, and lab equipment used by healthcare professionals and researchers. Cramer highlighted the company’s recent earnings during the May 7 episode, as he said:
This morning, we got a strong quarter from Becton, Dickinson and Company, which is one of the major medical supply and medical technology companies. After spending the last five years with some fine growth, Becton, Dickinson really shot the lights out with this one. Huge top and bottom line beat, management raising the full year earnings forecast, and that sent the stock up nearly 6% today on a not-so-great day for the market. The company showed excellent execution across the board. They’re getting a real boost from all sorts of technology that helps hospitals do more with fewer people.
