Jim Cramer Says This AI Stock Is a Sizzling February Buy

Investing

Published: February 9, 2025 10:23 am

A popular name in the financial media industry, Jim Cramer is the host of ‘Mad Money’ on CNBC and a former hedge fund manager. He is someone many investors look up to, and some of his picks have generated solid returns in the past. Jim also has an impressive following and he recently picked an AI stock, Apple (NASDAQ:AAPL) which could be a sizzling buy this month. With the AI market expected to reach $15.7 trillion by 2030, this stock is on its way to hitting new highs. Indeed, Cramer doesn’t hit the bull’s eye every time, but he has picked the right stocks in the past and has impressed investors with his research. Cramer recently advised investors against trading the stock and asked them to hold on to it instead. Like Cramer, Warren Buffett loves Apple stock and has invested a massive $303 billion in the company. 

Key points in this article:

• Jim Cramer has been bullish on Apple for a long time now.
• The company recently reported its best quarter ever.

• Apple, the most valuable company in the world, has a long run from here.

• If you are looking for stocks with huge upside potential, get your hands on a free copy of our brand-new “The Next NVIDIA” report which features a stock that has 10X potential. 
  

Most valuable company in the world

A household name, Apple is known for iPhones and enjoys loyalty from consumers across the world. Whether it is their watches, phones, or services, many people are willing to buy.

Apple is the world’s most valuable company and its recent quarterly results show that it is indeed ahead of all the competitors. The company beat expectations and reported a stellar performance in the computer and services business. Trading at $233, the stock is up 23% for the year and 11% over the last six months.

Best quarter ever 

In the recently announced results, it reported a revenue of $124.3 billion, up 4% year-over-year, and the services revenue hit an all-time high. Those worried about the company reporting a drop in iPhone sales should keep in mind that Apple is steadily growing its services revenue which is proof that the overall income is growing. Apple reported its best quarter ever. While Cramer is also worried about Apple in China, I believe this is a volatile period for all the companies in the U.S. and it is not permanent. Besides the sales dip, China is also looking to consider a probe into App Store fees and policies. However, it has not decided to open a formal investigation yet.

Apple has handled tough periods earlier and can do so again. The company’s China sales dropped 11% in the quarter, and the overall iPhone sales also declined year over year. The services division is Apple’s profit engine, reporting a revenue jump of 14% year over year. Its paid subscriptions increased by double-digit percentages, and the company has more than 1 billion paid subscriptions on the platform. 

A potential winner in the AI war 

Industry experts believe that Apple could be a winner amidst the AI war. After Deepseek, it looks like Apple is one company that did not spend a large amount of money and resources on building large language models, but instead, became a consumer. However, this does not mean that Apple did not invest in AI, it did and it focused on Apple products and not on building large models, which saved a ton of money for the company. The lack of urgency to spend a huge amount on new technology benefited the company and it managed to overtake Nvidia (NASDAQ:NVDA) as the most valuable company in the world. 

Evercore ISI analyst has a price target of $260 for the stock with an outperform recommendation while JPMorgan has an overweight recommendation with a price target of $270. The stock isn’t cheap right now but looking at the growing profits, massive cash flow, and consistency, it could be a steady winner in the next five years. 

The stock is moving closer to the 52-week high and could see a strong rally in the second half of the year. Despite a drop in China revenue, the company has managed to report its best quarter ever. Its services segment has become stronger over the years and with over 1 billion paid subscriptions, the revenue is predictable. Apple will be a great stock to own for the long term.