TLDR
- Jim Cramer predicts Nvidia’s next decade will surpass its previous 1,200% stock gains through a new “chip reasoning platform” technology
- The platform would enable chips to form opinions and make decisions with fewer errors than humans
- Cramer suggests industries like law firms could be transformed, potentially replacing roles such as fourth-year associates
- Wall Street maintains a Strong Buy rating on NVDA with an average price target of $216.78, representing 16.8% upside
- Cramer has been bullish on Nvidia since 2017, even naming his dog after the company to emphasize his conviction
Jim Cramer thinks Nvidia’s biggest chapter hasn’t been written yet. The CNBC Mad Money host told Yahoo Finance that the company’s next 10 years could dwarf everything that came before.
That’s quite the claim. The stock has jumped over 1,200% in the past five years.
Cramer isn’t talking about gaming chips or even today’s AI boom. He’s focused on what he calls a “chip reasoning platform.”
This technology would move beyond current AI capabilities. The chips would form their own opinions and make independent decisions.
Cramer believes these decisions could outperform human judgment. He says they would make “far fewer mistakes” than people.
The concept reminds him of astronomer Vera Rubin. She proved dark matter exists and changed science forever.
Industries Face Potential Overhaul
Cramer used law firms to illustrate the coming changes. He suggested that firms might not need fourth-year associates anymore.
The reasoning chips could handle tasks junior lawyers currently perform. The technology would complete this work with greater accuracy.
His confidence in Nvidia dates back to 2017. That year, he renamed his dog Nvidia to make a point.
Most investors dismissed the company as just a gaming chipmaker then. Cramer couldn’t get people to pay attention to what he saw.
A visit to CEO Jensen Huang’s office changed everything. Huang showed him AI demonstrations that seemed impossible.
The technology was creating art and theater scenarios. It was also generating restaurant concepts.
“I just saw it with my eyes,” Cramer recalled. People thought his views were “too crazy” at the time.
Huang urged him to tell investors about the stock. Cramer took the advice seriously.
Even now, he tells people to stop comparing Amazon and Apple. His message from 2017 still stands: buy Nvidia.
Regulatory Hurdles Ahead
The company faces some regulatory challenges going forward. Cramer warned that Nvidia needs to secure licensing deals.
Specifically, he mentioned deals with companies like The New York Times. These agreements would cover AI training data usage.
He pointed to Cloudflare as a beneficiary of these data battles. The web security company could see gains from increased data protection needs.
Wall Street analysts remain optimistic about NVDA. The consensus rating is Strong Buy based on recent recommendations.
Thirty-six analysts gave Buy ratings in the past three months. Two issued Hold ratings and one gave a Sell rating.
The average price target stands at $216.78 per share. This implies 16.8% potential upside from current trading levels.
Shares closed at $185.54 on October 6. Pre-market trading showed the stock at $186.30 the following morning.
Cramer’s eighth book promotion coincided with his latest Nvidia comments. “How to Make Money in Any Market” blends stock picks with investing lessons.
He admits that calling companies like Nvidia early doesn’t happen every investment cycle. But he’s making another prediction about the company’s trajectory.
Cramer argues “it’s not too late to buy Nvidia” despite the massive run-up. The chip reasoning platform represents what he calls “the big breakout.”
Wall Street’s $216.78 average price target suggests analysts agree there’s room to run.
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