NVIDIA Corporation (NVDA)

She feels that tech is trading at unsustainable multiples and can be volatile when reporting earnings. Nvidia has consistently had good earnings.

First-mover advantage. Gross margins are out of sight at 75%. No one's caught up to it yet. At some point, companies will make their own chips and rely less on NVDA, but not right now. Big tech is spending $200B this year on capex to meet AI demand, and a lot of that is going to NVDA.

Arguably inexpensive. At some point growth will tail off, but he's not smart enough to know when that will happen, so it's in the "too hard" pile.

Great company, a bellwether. Fantastic management. Growth rate for next year or two is great. 

Real risks that customers will make chips in-house or that demand falls. We won't know the answer for awhile, look at earnings size to figure out. His sense is that the wave is just starting, and NVDA will go really hard for 3-4 years. The other chip makers aren't taking market share yet, but just trying to catch up. 

Today it surpassed $3-billion in market cap--and Apple. It comes down to their visionary CEO Jensen Huang.

Already a big fan of this stock, he agrees with an analyst's report today: they have a roadmap to continue dominating the chips industry. They will have a huge free cash flow over the next 3 years, amazing gross margins and no real competition right now. Another analyst also said that if you believe that AI is about to peak in development, then Nvidia is over-valued by a mile, but if you feel that AI is still in its infancy, then investing in anything but AI will mean underperformance. He also agrees with this. One analyst targets $2,000, meaning it will double by the end of this year. But he (Cramer) has some caveats. To reach $2,000, then where will the money come from? Not unless Nvidia's rise crushes the market. Hm. Also, inflation will erode the value of NVDA's future cash flow. Also, NVDA isn't immune to the flows of the overall stock market. He doesn't agree with the most bullish projections. That said, own and don't trade NVDA.

No comments on short-term moves, as he invests for the long term. Meets a number of his criteria. Founder-run, founder-owned. ROIC quite strong. Valuation of 62x PE leaves him on the sidelines. Fast-moving space. Share split has no effect on the stock's value.

Everyone knows that they're going to have a great quarter. $24.5-25B in revenue, which is 3x that of a year ago. People will be looking at the margins. Gross margins now are 76%, phenomenal. Most importantly, people will look at the guidance, and analyst interviews will be key as they look out to 2025. Will have to see what the competition has in store.

Trendlines are great, but you have to watch when things go parabolic. Stocks tend to consolidate after that. This stock likes to do these big jumps. Seasonal slowness for high beta is coming. Nothing bearish about the chart. When it catches up to the trendline and the 200-day MA, it will be a buying opportunity.

Icon of the market right now. People are scared to own because it's up 4-fold in the past year. Earnings are coming out soon. Others will enter this space and will encroach on its moat, but right now it's #1. A name to own, try to buy when it backs off.

Will probably double from here, over the next 2-3 years, before people start taking market share from them.

Sometimes he has to say that he missed something, rather than chasing something. If he buys it here, can he generate the kind of return he's looking for? With this one, there's too much risk for him. Management's been spectacular, earnings should be great, but will it match expectations?

New chip technology is allowing major breakthrough's in actions like robots throwing the baseball. Research is also expanding in areas across the board. Chip technology is fastest on the market (Microsoft can't compete). Technology of chips is moving at such a fast rate, perhaps not understandable. Recent market correction a good time to buy. 

Firing on all cylinders. Still expensive at 19x forward price to sales. Management keeps executing, earnings keep coming in stronger. AI is coming, and NVDA is at the forefront. He prefers AMD.