Jim Cramer Explains Why Concentration in Meta and Other Big Tech Stocks Has Been Lucrative

Meta Platforms, Inc. (NASDAQ:META) is one of the stocks that Jim Cramer recently shed light on. Cramer discussed the strength of big tech stocks like META, as he said:

“There truly is a tremendous concentration of capital tied up in a handful of companies, but there’s so much fear mongering about this phenomenon that it’s almost guaranteed to lead you in the wrong direction. 12 years ago, I helped coin a term called FANG, Facebook, Amazon, Netflix, Google, because these companies were changing the world. Their spectacular growth prospects made them incredible investments… You had to hold onto these for dear life. Their impact on our lives was palpable. And of course, they’re worth far more now than they were selling for 12 years ago. There was a concentration then, there’s a concentration now. It’s not fatal, it’s lucrative. At the time, though, I took a lot of heat about my selection… Ladies and gentlemen, we’ve now had more than 12 years of concentration, a dozen years. All along, it’s been the same stocks… Facebook became Meta. Why? Because of Instagram, because of WhatsApp, because of reels, because of its dominance in advertising.”

Meta Platforms, Inc. (NASDAQ:META) develops technologies and applications that enable social connection, communication, and digital interaction across Facebook, Instagram, WhatsApp, Messenger, Threads, and more. Moreover, it creates hardware and software for virtual, augmented, and mixed reality experiences through Reality Labs.

While we acknowledge the potential of META as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.