CNBC’s Jim Kramer on Wednesday encouraged people to remain invested in Big Tech tech megacap names after recent market volatility raised concerns over moderating growth in the pool. Apple, Microsoft and Amazon, however, will be intact over the long term he said because their valuations are strong and solid and they will continue to innovate.
Big Tech isn’t going anywhere,” said Cramer in his recent segment on Mad Money. “These companies represent the modern economy backbone, and their adaptability to head in any direction is unprecedented.”
Big Tech’s Recent Market Challenges
Cramer’s remarks came as the technology-heavy Nasdaq has seen a turbulent ride with some megacap stocks well off their highs in price. Pounding the pavements is concern of rising interest rates, increasing regulatory scrutiny, and slow earnings growth, all keeping investors edgy lately. However, according to Cramer, they are short-term headwinds that should not obscure the long-term potential of industry leaders.
These companies have been through many storms,” Cramer said. “What has differentiated Big Tech from everybody else is that they can change with the environment and prosper.
Cramer cited, in his analysis, how Big Tech had fantastic balance sheets and cash reserves for investment in research and development, weathering any bad economic times, and other strategic acquisitions. He also talked of their dominance in big markets, including cloud computing, artificial intelligence, and consumer technology.
Don’t let the short-term noise in the market fool you,” Cramer said. “These companies are cash machines, and they can outlast anything.”
Investor Confidence and Diversification
Cramer said investors should diversify but retain Big Tech as the core of their portfolio. He admitted that while the sector has had some setbacks, its long-term trajectory is still very positive. Cramer also said that pullbacks in stock prices could present buying opportunities for those with a long-term investment horizon.
“Use these dips wisely,” he said. “If you have done your homework, you know these companies are worth holding onto.”
The Future of Big Tech
Yet Cramer remained optimistic that Big Tech would continue to be innovative and lead the way to growth, regardless of either a regulatory or economic challenge. From AI developments to the extension of cloud services, he said, these companies will continue to define the future and stay essential players in the global economy.
“Big Tech is where the future is happening,” said Cramer. “These are the companies that are redefining industries and creating new ones.
Looking ahead
as investors consider options in today’s volatile market, is underscored by Cramer’s call for a continuation of faith in Big Tech. And though there are still issues, strong and innovative companies such as Apple, Microsoft, and Amazon, continue to create great investment opportunities that will last into the long-term future.
