Cramer Sees AI Boom in Nvidia and CrowdStrike
Investors are being recommended to buy two artificial intelligence (AI) stocks that have seen significant growth since 2023. According to Jim Cramer, shares of Nvidia and CrowdStrike Holdings are worth considering for their potential.
Nvidia dominates the AI infrastructure market due to its graphics processing units (GPUs), which combine high performance with a broad software ecosystem. The company's GPUs account for nearly 90% of AI accelerator sales, making it a leader in the field.
In its second quarter fiscal 2027 results, Nvidia reported exceptional financials, with revenue increasing by 106% to $96.2 billion and gross margin expanding by 2.5 percentage points. Wall Street estimates that adjusted earnings will increase at 72% annually through January 2028, making the current valuation of 36 times earnings look undervalued.
CrowdStrike provides a cybersecurity platform with 34 modules addressing various security markets. The company is known for its dominance in endpoint security and has a strong presence in identity protection, cloud security, threat intelligence, and managed detection and response.
In its second quarter fiscal 2027 results, CrowdStrike reported revenue increasing by 26% to $1.4 billion, with non-GAAP earnings rising by 35%. Despite this growth, the current valuation of 230 times earnings looks expensive, with a median target price of $245 per share implying 4% downside from its current price.