Jim Cramer Says He Is "Not That Worried About Broadcom"

Broadcom Inc. (NASDAQ:AVGO) is one of the stocks Jim Cramer recently discussed. Cramer highlighted that he trusts the company CEO and commented:

“Last week turned brutal for the AI data center stocks when we got this pair of poorly received quarters from Oracle on Wednesday and then Broadcom on Thursday night. Oracle plunged 10.8% the next day. Broadcom dropped 11.4% on Friday. Dragged the whole group down with them. Now, as I mentioned in my Sunday think piece for the CNBC investing club, I’m not that worried about Broadcom, which we own for the Charitable Trust. Broadcom reported a healthy top and bottom-line beat. They gave strong sales and EBITDA guidance for the current quarter.

The stock only got hit because the CFO inartfully mentioned on the conference call that their AI business will include more full rack systems next year, meaning more systems with components not entirely made by Broadcom, and thus, the gross margins on those systems will be lower.

Oh, really scary. Oh, was the market stupid about this. It’s not a big deal, people. But remember, the stock had run up a great, really dramatically going into the quarter, so it got slammed. At the end of the day, I trust Broadcom CEO Hock Tan, he has never ever let me down, to keep delivering excellent numbers.

He will do it again. Historically speaking, every time the market’s doubted this guy, the market has been dead wrong. I told club members in that same think piece that I would hold onto Broadcom, but after today’s 20-point decline, it might be time to switch directions. Do some buying. So I feel good about Broadcom. You’re getting a real nice buying opportunity now… Broadcom, like I said to club members, stay close to your email. We could be pulling the trigger to buy more any minute.”

Broadcom Inc. (NASDAQ:AVGO) supplies semiconductor devices and infrastructure software, including networking, connectivity, and storage solutions. The company’s products are used for applications in data centers, telecommunications, broadband, smartphones, industrial systems, and AI networking.

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