Jim Cramer Questions Alphabet Inc. (GOOGL) Amid AI Cannibalism Concerns

Insider Monkey
Yesterday

We recently published a list of Jim Cramer’s Game Plan for Next Week: 25 Stocks in Focus. In this article, we are going to take a look at where Alphabet Inc.’s (NASDAQ:GOOGL) stands against other stocks that Jim Cramer discussed.

On Thursday, Jim Cramer, the host of Mad Money, walked viewers through what he described as an important week ahead for Wall Street, with earnings season hitting full stride and a flood of quarterly reports expected from companies spanning multiple sectors.

“The fact is the president wants lower interest rates to help offset the pain from higher prices that  gonna be caused by the tariffs, but higher prices represent inflation.”

READ ALSO: 12 Stocks on Jim Cramer’s Radar Recently and Jim Cramer Discussed These 12 Stocks Recently.

“The Federal Reserve never cuts rates when inflation’s out of control,” Cramer emphasized and added that it may very well become the case if tariffs continue to drive up costs. He made it clear that he respects Fed Chair Jerome Powell as he described him as a capable public servant who, in Cramer’s words, has “generally done a good job.” Still, he acknowledged Powell’s difficult position as he said the Fed chair is “stuck between a rock and a hard place.” He added:

“Now history says he should be doing exactly what he’s doing, but history is now in the eye of the beholder and there’s only one beholder in this whole country and it ain’t Jay Powell.”

While Cramer stopped short of diving deeper into political commentary, he admitted he is growing increasingly weary of the political noise surrounding monetary policy. As earnings reports begin to dominate the conversation, he highlighted how swiftly sentiment on Wall Street can shift based on results and noted that the market is entering a phase where “snap judgments” start flooding in after hours.

“Here’s the bottom line: I know it’s supposed to be a terrible time, right? I mean like woo, scary, but I don’t know. The companies themselves they keep delivering and delivering, and you know what? I don’t think next week’s going to be any different.”

Our Methodology

For this article, we compiled a list of 25 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on April 17. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 234

Cramer expressed uncertainty about Alphabet Inc.’s (NASDAQ:GOOGL) Google business as he said:

“After the close, we have a very compelling night. We get results from Alphabet, and I’m not sure how the core Google business can be doing if people are starting to use ChatGPT, Grok, Claude, and even Alphabet’s own Gemini, although I use that last. There’s too much cannibalism here. At the same time, the company was just dealt a severe legal defeat in its ability to handle both sides of the advertising business. Tonight, we have on the former Justice Department lawyer who originally brought the case to help figure out what this all means.

I am sure Alphabet will tell us not to worry. They always tell us not to worry. You know, when people tell you not to worry, what do you do? Exactly. Alright, now here’s what you need to know, you can’t model the advertising gross margins in 2027 because of that lawsuit loss. So if you can’t model 2027, then you can’t model it, and now we discover why it sells at 16 times earnings, because it may be expensive.”

Alphabet (NASDAQ:GOOGL) is a parent company made up of multiple businesses, with Google being the most famous. It offers a wide variety of popular products and platforms, including Search, Ads, Chrome, Cloud, YouTube, and Android.

Overall, GOOGL ranks 21st on our list of stocks that Jim Cramer discussed. While we acknowledge the potential of GOOGL as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GOOGL but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

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

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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