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Leaner Marketing and Stronger Cash Flows

Breaking down the expenses, selling and marketing costs came down by 38% compared to the same quarter last year, clocking in at $33 million. It reflects on management’s continued focus on deploying an efficient approach for its user acquisition initiatives. The approach is based on a more targeted performance marketing across certain channels that lead to durable high-value users, instead of broader campaigns for near-term benefits.

The reported quarter marked a turnaround related to the equity accounted associates. These contributed a $2 million profit share, which was a reversal from a $2 million loss share in Q2 FY25. Most notably, cash flows from operating activities turned from negative $10 million in Q2 FY25 to positive $10 million in the reported period.

Weaker Player Engagement Drags Down GDEV’s Q2 Bookings

Several operating metrics weakened during the reported quarter. Monthly paying users dropped by 23% year-over-year, along with a 15% decline for the entire first half. This was the major underlying reason for a sluggish performance in bookings, which stood at $73 million and $156 million for the second quarter and first half of the year, respectively. These fell short in comparison to $92 million and $173 million recorded in the corresponding periods last year. GDEV also said the decline in first-half platform commissions was driven by lower revenues recognized from PC platforms, while PC’s share of bookings fell to 36% from 39%.

The reported quarter also resulted in a $1 million loss related to the net foreign exchange, against a $1 million gain during the same period last year. A cumulative effect of all these factors was that the Q2 adjusted EBITDA came down to $20 million from $22 million in 2025.

Institutional Sentiment

Despite a slight uptick in the number of smart money managers invested in the company, data tracked across 1,000+ hedge funds by Insider Monkey reveals low level of institutional interest. As per 13F filing data for Q2 2026, a total of 5 hedge funds held positions in the stock compared to 4 by the end of the first quarter.

As per Yahoo Finance database, Mubadala Investment is one of the largest institutional investors with 374.08 thousand shares, representing 2.06% of outstanding shares. Other notable institutional names include AdvisorShares Investments and UBS Group that hold 0.07% and 0.02% of outstanding shares, respectively.

Way Forward

GDEV’s second-quarter print leads to a mixed picture. While cost discipline and cash generation gave some confidence to investors, lackluster results for bookings and paying users point to prevailing challenges for the topline. Whether the company’s more selective marketing approach can offset weakening player engagement over the coming quarters remains an open question worth monitoring closely.

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While we acknowledge the potential of GDEV 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.

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The company’s OSA portfolio includes CPAP and APAP machines, led by the AirSense platform. The AirSense 10 series is one of the most widely used CPAP and APAP machine series. Beyond sleep therapy machines, it also offers nasal, nasal-pillow, and full-face masks, along with a wide range of accessories and related products.

The broad product portfolio offers multiple avenues for generating recurring revenue beyond the initial sale of a sleep therapy device.

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In the fourth quarter of fiscal 2026, ResMed’s revenue increased 9% year over year to $1.5 billion, supported by strong demand for sleep devices, masks, and accessories. Americas device revenue increased 6%, while total Americas Sleep and Breathing Health revenue rose 8%. Americas masks and other revenue increased 10%. The stronger performance is particularly important as it highlights the ability to monetize the installed patient base beyond the initial device purchase.

RBC Sees Further Earnings Growth

Amid the strong OSA demand and growth, RBC Capital expects the company to achieve high single-digit earnings per share growth over the next three years. While the company could come under pressure if Philips Respironics returns to the US market, RBC assumes a return in fiscal 2028.

Similarly, on September 15, the research firm upgraded ResMed Inc. (NYSE:RMD) stock to an Outperform from Sector Perform. It also raised the price target to $262 from $244, expecting it to continue generating significant value behind market leadership in obstructive sleep apnea devices.

Competitive and Guidance Risks Remain

Nevertheless, ResMed is not immune to risks amid its strong position in sleep apnea treatment. Soaring competition is the biggest threat that could rattle the company’s growth metrics. For a long time, Philips Respironics has been absent from the US market. Its return to the market could give physicians and patients a major alternative, thereby piling pressure on sales.

Additionally, the stock has come under pressure after issuing a 2027 forecast that fell short of Wall Street expectations. It expects revenue to range between $5.75 billion and $5.85 billion, below analysts’ expectations of $5.92 billion. The disappointing guidance comes as the company stares at cost and competitive pressures that limit growth.

Another near-term headwind is the suspension of Astral ventilator sales following a device correction that the FDA classified as a Class I recall. The disruption could weigh on revenue while ResMed addresses the issue and works toward resuming sales.

Hedge Fund Positioning

Hedge fund interest in ResMed remained relatively stable in the second quarter. The number of hedge funds holding positions in RMD stock stood at 45, unchanged from the first quarter.

Some major investors increased their exposure during the quarter. Arrowstreet Capital raised its stake by 151% to approximately $220.16 million, while AQR Capital Management increased its position by 161% to approximately $177.14 million.

At the same time, bearish positioning remains significant. As of August 31, approximately 13.07 million ResMed shares were sold short, representing short interest of 9.06% of shares outstanding.

The Verdict

ResMed Inc. (NYSE:RMD) enters the next phase of growth supported by a leading position in sleep apnea treatment. The company’s ability to generate revenue beyond the initial device sale also provides an important source of recurring demand. . The key question for investors is whether the company’s market leadership and expanding product ecosystem can continue to offset intensifying competitive and operational pressures.

Investors should also balance underlying strengths against the return of Philips Respironics to the U.S. market, weaker-than-expected fiscal 2027 revenue guidance, and the temporary Astral ventilator sales suspension. These factors could limit near-term growth even as the underlying OSA market continues to expand.

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While we acknowledge the potential of RMD 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.

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READ NEXT: Here’s Why Kinetik Holdings Inc. (KNTK)’s Strong Fundamentals Could Fuel a Potential Takeover and Zscaler, Inc. (ZS)’s Growth Engine Is Strong, But Slowing ARR Could Pressure the Stock. 

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On September 15, Tigress Financial highlighted the strategic importance of the alliance to Intel’s turnaround prospects. The research firm reiterated its Buy rating on Intel and raised its price target to $145 from $118, citing the company’s long-term growth opportunity.

 AI Driven Turnaround

The Terafab partnership could provide Intel’s foundry business with exposure to customers that have substantial AI and high-performance computing requirements. Securing external customers could help Intel increase manufacturing scale while improving the utilization and economics of its foundry operations.

The partnership could also support Intel Corporation (NASDAQ:INTC)’s efforts to improve its semiconductor manufacturing technology. Greater production volumes and engagement with demanding customers could provide opportunities to improve manufacturing economics, yields, and scalability as Intel works to strengthen its competitive position in advanced chip manufacturing.

Beyond manufacturing scale, Terafab could expand Intel’s role in the broader AI semiconductor supply chain. The company has historically been heavily associated with CPUs, but growing its foundry business could give it greater exposure to AI accelerators, custom silicon, and other specialized compute applications. A relationship with major AI-focused customers could also help provide greater visibility into future manufacturing demand.

Tigress Financial expects the Terafab partnership to support Intel’s AI-driven turnaround by expanding its addressable AI foundry opportunity. If Intel can achieve greater manufacturing scale while improving yields and production economics, the foundry business could eventually make a more meaningful contribution to profitability.

Intel has also emphasized the broader opportunity created by AI-driven demand for computing. In its second-quarter earnings report, the company said it remains well positioned to pursue sustainable growth through advanced packaging and its wafer foundry network. Intel also pointed to momentum in Physical AI and robotics, with more than 130 customers or testing its Core Ultra Series 3 and Core Series 3 processors for edge AI and robotics applications.

Terafab Partnership Risks

However, the Terafab partnership is unlikely to translate into a large, quantifiable revenue contribution for Intel in the near term. The principal risk is that the initiative could strengthen Intel’s strategic position in foundry manufacturing without generating meaningful financial returns for several years. The partnership’s commercial terms, production volumes, and potential revenue contribution have not been fully disclosed.

Intel Corporation (NASDAQ:INTC) could also face customer-concentration risk. The initiative is closely associated with Musk’s companies, which could potentially generate substantial semiconductor demand. However, dependence on a relatively small group of customers could expose Intel to changes in their product roadmaps, chip architectures, production requirements, or capital-spending plans.

Competition remains another significant challenge. Intel is attempting to expand its foundry operations while established advanced semiconductor manufacturers continue to compete aggressively for customers and market share. Winning major external customers will ultimately depend on Intel’s ability to deliver competitive process technology, manufacturing yields, capacity, pricing, and reliability.

Hedge Fund Positioning and Short Interest

Meanwhile, hedge fund positioning suggests growing institutional interest in Intel. According to the Insider Monkey database, 138 hedge funds held stakes in Intel Corporation (NASDAQ:INTC) at the end of the second quarter, up from 112 funds in the first quarter. SoftBank Group Corp. and Coatue Management were among the notable institutional holders, with stakes valued at approximately $12.14 billion and $1.68 billion, respectively, at the end of the second quarter.

As of August 31, approximately 152.25 million Intel shares were sold short, representing about 3.02% of the public float.

The Verdict

Intel Corporation (NASDAQ:INTC)’s Terafab partnership adds another potential catalyst to the company’s efforts to rebuild its semiconductor manufacturing and foundry businesses. Access to customers with significant AI and high-performance computing requirements could help Intel increase manufacturing scale, strengthen its foundry capabilities, and expand its exposure to the growing AI semiconductor market.

The opportunity, however, remains dependent on execution. The financial contribution from Terafab is difficult to quantify at this stage, while competition, customer concentration, manufacturing execution, and the time required to improve foundry economics remain important considerations for investors.

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While we acknowledge the potential of INTC 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.

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READ NEXT: Here’s Why Kinetik Holdings Inc. (KNTK)’s Strong Fundamentals Could Fuel a Potential Takeover and Zscaler, Inc. (ZS)’s Growth Engine Is Strong, But Slowing ARR Could Pressure the Stock. 

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On September 12, Goldman Sachs raised its price target to $115 from $106, citing improving underlying fundamentals. The hike follows the company’s impressive fourth-quarter fiscal 2026 results, with revenues surging 33% to $1.2 billion and operating income rising $89 million to $147 million.

The robust revenue growth came as the company continued to attract more business interest-bearing loans. Interest income rose 35% in the fourth quarter, in line with a 33% increase in average net loans held for investment partners. More importantly, 80% of Affirm’s direct-to-consumer product loans carried interest at quarter-end, giving the company an increasingly meaningful source of recurring interest income.

Affirm Card Strengthens Growth Outlook

The investment bank has also touted the growth opportunity around Affirm Card, which is helping the company expand its relationship with consumers beyond individual BNPL transactions. Active cardholders more than doubled to 5.2 million, resulting in a 124% increase in Card GMV to $2.8 billion.

Management has already hinted at continued upside momentum by estimating a massive increase in GMV to $64 billion in fiscal 2027 and an adjusted operating margin of 30.5%. Against this backdrop, Wolfe Research analyst Darrin Peller upgraded the stock to Outperform with a $90 price target. According to the analyst, Affirm Holdings is a winner in the point-of-sale financing space.

Credit Risks Remain

Amid the robust gross merchandise volume increase, Affirm Holdings, Inc. (NASDAQ:AFRM) faces significant risks from loan originations. Rapid GMV growth does not necessarily translate into higher profits if deteriorating credit quality drives loan losses and credit costs higher.

Additionally, the company’s core business remains highly sensitive to consumer credit quality. A weakening U.S. consumer, rising unemployment, or increased delinquencies could trigger higher provisions and reduce profitability.

The Buy Now Pay Later offering is also becoming increasingly competitive as banks, fintech companies, retailers, and payment networks expand installment-payment offerings. Competition could force Affirm to offer lower merchant fees or more attractive consumer terms, limiting revenue growth even if GMV continues rising.

Hedge Fund Positioning and Short Interest

The number of hedge funds holding stakes in Affirm Holdings, Inc. (NASDAQ:AFRM) dropped to 57 in the second quarter from 61 in the first quarter, according to the Insider Monkey database. Durable Capital Partners reduced its stake by 22% to $360.89 million, while D1 Capital Partners trimmed its share count to a stake worth roughly $155.64 million. As of August 31, short interest stood at 15.67 million shares, equivalent to about 4.64% of shares outstanding, suggesting relatively modest bearish positioning.

The Verdict

Affirm is in a phase of robust growth characterized by expanding interest income and rapid adoption of Affirm Card. Ambitious GMV and margin targets also affirm significant operating leverage as scale increases. However, investors should closely monitor credit performance. The same expansion in interest-bearing loans could become a source of downside pressure if consumer delinquencies rise sharply.

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While we acknowledge the potential of AFRM 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.

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READ NEXT: Robinhood (HOOD) Expands Prediction Markets With Crypto.com Partnership and Zscaler, Inc. (ZS)’s Growth Engine Is Strong, But Slowing ARR Could Pressure the Stock. 

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Morgan Stanley raised its price target on Accenture to $175 from $130 on September 14. Accenture shares soared more than 6% in afternoon trading following the price target increase, even though the firm reiterated its Equal weight rating on the stock.

Meanwhile, UBS recently maintained a Buy rating on the stock with a price target of $275. The bank pointed to confidence in the company’s positioning around AI and, in separate notes, its acquisition strategy. However, Wells Fargo downgraded Accenture to Equal Weight. According to Wells Fargo, macroeconomic pressures could weigh on fiscal 2027 growth expectations.

The question is whether Accenture’s expanding AI capabilities and acquisitions can translate into long-term growth.

AI Gives Accenture a Potential Growth Engine

Accenture’s AI fortunes are tied to enterprise deployment of the technology. The company has formed a joint business group with Google Cloud to deploy AI engineers across enterprise clients. That arrangement gives Accenture another channel through which AI adoption can create demand for consulting, implementation, and integration services.

Acquisitions provide another growth engine. By adding specialized capabilities, Accenture can expand its addressable market and strengthen its ability to handle complex AI projects.

The Real Test Is Fiscal 2027 Growth

The bull case depends on Accenture converting AI adoption into revenue growth at a time when macroeconomic conditions are a concern. Wells Fargo’s warning is important because fiscal 2027 growth results could become the market’s primary test of whether Accenture’s expanding AI opportunity is translating into actual business.

The risk is that enterprises delay discretionary technology spending. At the same time, some AI applications could reduce demand for traditional technology services.  That could lead to Accenture losing existing contracts faster than it can replace them with AI opportunities.

If acquisitions and AI capabilities stimulate strong demand, Accenture could be on a clear course to regain the growth profile that the market has previously rewarded. If growth remains subdued, the heavy investment in AI capabilities and acquisitions would be hard to justify.

Investors Are Positioning for a Growth Recovery

According to Insider Monkey’s database, the number of hedge funds holding Accenture rose to 69 in Q2 from 64 in Q1. Pzena Investment Management, the largest hedge fund holder, increased its stake 114% to more than 5.1 million shares. That followed an 84% increase in Q1 and 287% in Q4.

Other major funds have also been increasing exposure to Accenture. AQR Capital Management increased its position 245% to roughly 3.7 million shares to become the second-largest holder.  Greenhaven Associates established a new position of around 3.4 million shares, making it the third-largest hedge fund holder.

But investor positioning is not uniformly bullish. The short interest in Accenture rose almost 9% from the previous reading to 3.81% of the public float as of August 31. With five days to cover, the short interest points to growing bearish positioning.

AI and acquisitions provide credible growth opportunities for Accenture. The investment case now rests on execution.

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While we acknowledge the potential of ACN 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.

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READ NEXT: Northrop Grumman (NOC) Secures $4.8 Billion Army Contract. Execution Is the Bigger Test and Pentagon Adds $13.4 Billion to Boeing (BA) Contract. That Isn’t an Immediate Financial Windfall.

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NextEra’s business is already growing, and Dominion is expected to increase the growth rate. The deal’s promise is exciting, but its value to investors ultimately depends on NextEra securing regulatory approvals and successfully integrating Dominion assets.

 NextEra Already Has a Strong Standalone Growth Path

NextEra Energy, Inc. (NYSE:NEE) has reaffirmed its 2026 adjusted EPS guidance of $3.92 to $4.02 and said it was targeting the high end of that range. NextEra also said it expects adjusted EPS to grow at a compound annual rate of at least 8% through 2032 and is targeting the same growth rate through 2035, off the 2025 base.

NextEra also plans to continue rewarding its shareholders with higher dividends. The company expects its dividend per share to grow at a roughly 10% annual rate through 2026, off the 2024 base. It expects the dividend to grow 6% a year through 2028 from the 2026 base.

The EPS and dividend growth projections give investors a financial foundation for evaluating the Dominion deal. NextEra does not need Dominion simply to prevent a growth slowdown. Instead, it’s looking to add another growth engine through the acquisition.

NextEra expects Dominion to be immediately accretive to adjusted EPS. The combined company is expected to deliver 9%+ adjusted EPS growth through 2032 and is targeting the same growth rate through 2035, off NextEra’s 2025 base.

The combined company would operate the largest natural gas-fired generation fleet in the U.S. and the second-largest nuclear fleet.

The Merger’s Financial Case Depends on Regulatory Approval

NextEra Energy, Inc. (NYSE:NEE) expects to close the Dominion transaction in the second half of 2027. The biggest near-term test is whether NextEra can secure the regulatory approvals to close the deal in the expected time.

The companies are trying to improve the deal’s approval chances through an expanded benefits package submitted to Virginia regulators. In updated filings, they have proposed to double residential bill credits to four years. Additionally, they are committing to shielding retail customers from grid costs associated with Northern Virginia’s rapidly expanding AI data centers.

And that’s not all. They have also added $100 million to Dominion’s low-income bill assistance program through 2038 and another $100 million for workforce development. These commitments matter because the deal’s expected benefits hinge on regulatory approvals.

The merger could strengthen NextEra’s growth trajectory if it closes on time and with favorable conditions. But the thesis weakens if the deal’s closing is delayed or regulators impose conditions that materially diminish the deal’s expected economic benefits.

Investor Positioning Is Expanding, But Conviction Is Mixed

Insider Monkey’s hedge fund database suggests that elite investors are paying attention to NextEra Energy, Inc. (NYSE:NEE)’s growth prospects. But major funds are showing divergent trades.

The number of hedge funds holding NextEra stock increased to 80 in Q2 from 74 in Q1. GQG Partners remained the largest hedge fund holder, though it did reduce its stake by 20% to 7.42 million shares. But Marshall Wace, the second-largest holder, increased its stake 350% to 3.37 million shares. Balyasny Asset Management also raised its stake by 2,084% to 1.62 million shares.

Regarding bearish bets, some 49.8 million NextEra shares were shorted as of August 31. That represents 2.39% of the float and remained essentially unchanged from the previous reading.

The big question right now is whether NextEra can maintain its standalone growth while absorbing Dominion. The reaffirmed 2026 outlook and 2035 projections provide a solid starting point. But regulatory approvals and execution remain major tests.

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While we acknowledge the potential of NEE 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.

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READ NEXT: Northrop Grumman (NOC) Secures $4.8 Billion Army Contract. Execution Is the Bigger Test and Pentagon Adds $13.4 Billion to Boeing (BA) Contract. That Isn’t an Immediate Financial Windfall.

Disclosure: None. Follow Insider Monkey on Google News.

The acquisition will strengthen the company’s agentic AI capabilities as it moves to capitalize on growing demand for AI agents that can handle business transactions. Plans are underway to integrate Stilla.ai’s team and technology into Meta Business Agent, which already helps businesses interact with customers across various platforms.

Stilla.ai’s technology could help Meta’s Business Agent enable more sophisticated interactions between customers and AI agents across its messaging platforms. In the long term, customers could use AI agents to inquire about products, discuss pricing, and potentially complete purchases without leaving Meta’s ecosystem.

Such capabilities could result in new monetization opportunities as the company faces increasing pressure to generate returns from its substantial artificial intelligence investments. Rather than relying exclusively on AI to improve advertising efficiency, Meta could use AI to facilitate transactions and capture value from the commercial activity taking place across its platforms.

AI-Powered Commerce Opportunity

The acquisition could help the company build an AI-driven commerce layer across its massive messaging ecosystem. The company has access to billions of users across Facebook, Instagram, Messenger, and WhatsApp, while millions of businesses already use its platforms to communicate with customers.

If Meta Platforms, Inc. (NASDAQ:META) can successfully integrate AI agents into these interactions, the company could eventually monetize transactions occurring across its platforms. This would provide another potential revenue stream while making its messaging services more valuable to businesses.

Key Underlying Risks

However, investors should not expect the Stilla.ai acquisition to materially affect Meta’s revenue or earnings per share in the near term. Stilla.ai remains a small startup, and developing AI-powered commerce at scale could take years. The company still needs to invest in infrastructure, product development, and integration before Meta Business Agent can generate meaningful transaction-related revenue.

There is also a risk that the incremental revenue generated by Meta Business Agent remains modest relative to the company’s enormous AI spending. Integrating Stilla.ai’s technology could take considerable time, and slower-than-expected adoption could limit the financial payoff from the acquisition.

Consumer trust, privacy, and AI reliability represent additional challenges. AI agents handling product recommendations, pricing discussions, payments, and other commercial interactions must operate reliably and securely. Concerns surrounding the reliability and handling of sensitive information by Meta’s AI products could become more significant as the company gives AI agents greater autonomy.

Hedge Fund Positioning

According to the Insider Monkey Database, 254 hedge funds held positions in Meta Platforms, Inc. (NASDAQ:META) during the second quarter, down slightly from 262 funds at the end of the first quarter. Newlands Management Operations LLC reduced its position by approximately 2% to $5.44 billion, while Fisher Asset Management increased its stake by 2% to $3.83 billion.

Short interest remains relatively limited, suggesting that investors are not positioning aggressively against the stock. As of August 31, approximately 1.13% of Meta’s outstanding shares were sold short, representing roughly 28.81 million shares.

The Verdict

The Stilla.ai acquisition represents a potentially important Meta Business Agent monetization opportunity. If Meta Business Agent can eventually handle product discovery, customer service, negotiations, and transactions, Meta could create a new monetization layer beyond advertising.

For investors, however, the opportunity remains more long-term than immediate. Stilla.ai is unlikely to materially move Meta Platforms, Inc. (NASDAQ:META)’s financial results in the near term, while the company will need to spend heavily on AI infrastructure and product development. The key question is whether Meta can convert its enormous user and business base into meaningful AI-driven commerce revenue while maintaining consumer trust and controlling the costs associated with deploying increasingly sophisticated AI agents.

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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.

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READ NEXT: Robinhood (HOOD) Expands Prediction Markets With Crypto.com Partnership and Roivant Sciences Ltd. (ROIV)’s Pulmonary Hypertension Breakthrough Could Transform Its Growth Story. 

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“I had George Kurtz last night, who has partnered both with OpenAI and Anthropic. And he encouraged me to say look, they are doing a lot of things about safeguards. I think he was so much surprised, that there was so much doomsaying, of course, doomsaying being heavily refuted. Now there’s a stock, remember that stock was up the most of any stock in the S&P.”

While Cramer believes CrowdStrike Holdings, Inc. (NASDAQ:CRWD) will play an important role in cybersecurity in the AI era, the broader debate about the firm is about its AI-driven cybersecurity initiatives and whether they are sufficient to stay competitive and justify the eye-watering share price performance. On this front, the firm’s annual recurring revenue (ARR) grew by 25% and net new ARR grew by 55% in its fiscal second quarter. Additionally, CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s net new ARR set a new record of $333 million. Cramer’s bullishness on the firm is also matched by others, such as analysts from Argus. Argus has set a $425 share price target for CrowdStrike Holdings, Inc. (NASDAQ:CRWD) and argued that growth in agentic AI use presents a major tailwind for the firm.

Yet, in a classic case of the bigger you are, the harder you fall, CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s massive growth creates risk. For its fiscal second quarter, the firm has guided net new ARR to range between $343 million and $347 million to imply growth ranging between 29% to 31%. Considering that the metric grew by 55% in Q1, the new figures do indicate a slowdown. As for catalysts from agentic AI, CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s next-gen SIEM (Security Information and Event Management) ending ARR grew by 60% to $695 million in the second quarter.

Hedge fund interest in CrowdStrike Holdings, Inc. (NASDAQ:CRWD) grew in Q2. According to Insider Monkey’s data, 89 out of 1,006 funds had held a stake in the firm during the period. This marked a jump over the 89 out of the 1,022 funds in Q1. As for valuation, CrowdStrike Holdings, Inc. (NASDAQ:CRWD)’s forward P/E ratio of 188 is significantly higher than peer firm Palo Alto’s 89 which should increase the pressure to maintain growth. Short interest as a percentage of float is 2.41% for CrowdStrike Holdings, Inc. (NASDAQ:CRWD) compared to 2.65% for Palo Alto.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“One company, GE Vernova, which was hit incredibly hard, which actually builds these, was saying they’re seeing an order acceleration. So I really doubt the idea there’s going to be a decel. Now that stock got hammered yesterday, it’s been a horrendous stock since we started getting this political controversy. But again I point out that you just hear no one say anything about pullback.”

For GE Vernova Inc. (NYSE:GEV), as perhaps indicated by the share price movement, the narrative is driven by its backlog and overall exposure to AI’s power generation demand. On this front, CEO Scott Strazik, another Cramer favorite, outlined during the firm’s second quarter earnings that data center orders of $5 billion for H1 2026 had already doubled over the full year 2025 figures. Additionally, during Q2, the firm’s total orders touched $24 billion to mark an 88% growth driven by its Power and Electrification segment. As a whole, GE Vernova Inc. (NYSE:GEV)’s Q2 revenue grew by 22% annually, while its overall backlog and electrification backlogs sat at $176 billion and $446 billion.

At the same time, with GE Vernova Inc. (NYSE:GEV) also relying on gas turbines for its business, the debate is also about whether exposure to AI can remove the inherent cyclicality in the business. Additionally, with data centers accounting for 40% of the Electrification business’s orders, any slowdown in capex spending by big tech players could generate tailwinds for GE Vernova Inc. (NYSE:GEV). Similarly, while the data center business is booming and the gas generation business remains tied to prices and interest rates, the firm’s wind business is a drag and expected to hurt the bottom line throughout 2026.

In Q2, 106 out of the 1,006 funds tracked by Insider Monkey had held a stake in GE Vernova Inc. (NYSE:GEV), which marked a dip over the 118 out of 1,022 funds in Q1. Whether the dip was due to the order mix and AI sentiment or due to profit taking, your guess is as good as ours. On the valuation front, GE Vernova Inc. (NYSE:GEV) trades at a forward P/E ratio of 35, while short interest as a percentage of float is 3.29%.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“What’s refuted by Hock Tan, of course, maybe Hock Tan is one of the biggest providers of semis, other than NVIDIA, and when I asked him about, give me a prediction about the AI slowdown, would there be one, he said, not in the least. We see the demand for compute infrastructure for development of AI and inference as extremely strong and durable. So I know those stocks were the most heavily hammered, other than the fiber stocks. But David, when you listen to what Hock Tan said last night on Mad Money, you are inclined to do buying.

“I think David, you recognize, and a lot of people don’t, when you’re speaking about Hock Tan, whom I had on, you’re talking about a 1.6 trillion dollar company. This isn’t just someone. . .worried about what orders are going to be. . .this man has more orders than almost anybody other than Jensen Huang. So I think Carl, when we get very, very negative we still have to rely on the facts And the facts do not support there are some people who are very worried about mankind, I did not get the mankind worry when I spoke yesterday.”

The CNBC TV host’s remarks about Broadcom Inc. (NASDAQ:AVGO) sit right at the center of the debate for the firm. This debate is about whether it will be able to continue to capture additional orders for custom AI chips. Looking at the third quarter earnings, released on September 2nd, the growth narrative appears to be quite strong.

It boosts Cramer’s claims of Broadcom Inc. (NASDAQ:AVGO) experiencing strong orders, as during the quarter, the firm’s revenue grew by 86%, AI semiconductor revenue jumped by 221% and fiscal year 2026 guidance implied 186% annual AI revenue growth. Not to mention, CEO Tan reaffirmed that Broadcom Inc. (NASDAQ:AVGO) could pull in $115 billion in annual AI chip sales in 2027 and a whopping $230 billion in 2028.

Yet, while Tan, and Cramer, remain optimistic about the firm’s orders, the fourth quarter guide did leave investors wanting more. For the fiscal Q4, Broadcom Inc. (NASDAQ:AVGO) guided $34.8 billion in revenue which missed analyst estimates of $35.03 billion. Not to mention, the firm guided Q4 gross margin at 73% which marked a five point annual drop due to a higher mix of XPU sales. XPUs need more memory chips and the memory market is experiencing historic prices due to hot AI demand. Coupled with the fact that estimates have suggested that 71% of Broadcom Inc. (NASDAQ:AVGO) ‘s fiscal 2027 and 2028 XPU deployment could rely on OpenAI and Anthropic, the firm could experience headwinds. In other words, a huge portion of the orders might be from firms that are now calling for a slowdown in AI development.

What do the hedge funds think? Well, in Q2, 170 out of the 1,006 finds tracked by Insider Monkey had held a stake in Broadcom Inc. (NASDAQ:AVGO).  This marked a slight drop over the 163 out of 1,022 funds in Q1. Notable exits included Third Point and Two Sigma Advisors. As for the valuation, the stock trades at a forward P/E ratio of 18 which is lower than NVIDIA’s 23.42.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“So it was interesting that Walmart stock went up yesterday and Kroger stock did not react to the negative earnings. As if, somehow, they are going to be able to get a little bit more of a margin.”

On the topic of earnings, The Kroger Co. (NYSE:KR)’s second quarter results saw the firm cut its full-year identical sales growth guide to 0.2% and 0.8% from an earlier 1% to 2%. The firm’s identical sales growth also dropped significantly in the second quarter, as it sat at 0.2% compared to 3.4% in the year-ago quarter. The figure also missed analyst estimates of 0.9%.

The weakness pointed towards the potential impact of lighter consumer spending in an inflationary environment, with reports suggesting that while consumers are making more store trips, they are reducing discretionary spending and overall basket size. The higher costs also appeared to affect The Kroger Co. (NYSE:KR)’s operating margin, which remained flat annually at 2.8%. However, on the positive side, particularly when it comes to margins, the firm’s high margin marketing business, KPM, grew its profit by 24% annually to provide the firm with much needed margin pressure relief.

On the other hand, Walmart Inc. (NASDAQ:WMT)’s second quarter saw the firm grow comparable sales at 2.6%, which was much faster than Kroger’s growth. Yet, even this growth was the slowest in nearly five years, and it missed analyst estimates of 3.7%. Management was also upfront about the impact of higher fuel prices and outlined that it expected a $10 billion cost headwind from the higher prices in fiscal year 2027. Yet, just like Kroger, Walmart Inc. (NASDAQ:WMT)’s advertising revenue growth was strong. The business grew revenue by 38% with initiatives such as Walmart Connect growing by 43%.

Looking at the valuation, Walmart Inc. (NASDAQ:WMT)’s forward P/E ratio of 37 is significantly higher than Kroger’s 11.96. Considering the difference, it’s unsurprising that Cramer had remarked on August 24th that: “I guess you have to let go of your Walmart unless you think you have a plan.” As for the short interest, 1.9% of Walmart Inc. (NASDAQ:WMT)’s float is short, while the figure is higher at 4.69% for Kroger. Hedge fund interest, at 111 funds in Q2, is significantly higher for the former compared to 56 for the latter.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“Oh I wish I. . .I got to tell you David, if I had it all over to do. I would never have gone into Goldman Sachs, I would have gone to Valero, that’s where the money is.”

Looking at Valero Energy Corporation (NYSE:VLO)’s financial performance, the firm’s second quarter revenue jumped by 49% annually to sit at $44 billion, while its net income jumped to a staggering $3.7 billion from the year ago figure of $714 million. At the center of the growth was Valero Energy Corporation (NYSE:VLO)’s refining business, as the operating jumped to $4.47 billion, or by 252%. Simultaneously, the firm’s refining margins and refining margins per barrel jumped by 93% and 91%, respectively.

While the growth can also be attributed to the crack-spread cyclicality, Valero Energy Corporation (NYSE:VLO)’s ethanol operating income jumped by 488% while renewable diesel swung to $717 million operating income from the year-ago’s $79 million operating loss on the back of capacity growth that can help with the traditional upcycle cyclicality of the summer season.

On the flip side, should electrification continue, especially in commercial fleets, then Valero Energy Corporation (NYSE:VLO) could experience headwinds for its diesel business. Additionally, the conflict in Iran has once again shaken the global energy industry and spurred non-OPEC development of refinery capacity. This capacity surge could reduce the benchmark Gulf Coast 3-2-1 crack spread that Valero Energy Corporation (NYSE:VLO) is exposed to through its presence in the US Gulf Coast. The firm’s reliance on renewable diesel to potentially introduce alternate revenue streams could also experience headwinds from regulatory changes.

Looking at the valuation, Valero Energy Corporation (NYSE:VLO)’s forward P/E ratio of 14.39 is roughly in line with its peers, while its short interest as a percentage of float is similar to Marathon Petroleum but higher than Phillips 66. Hedge fund sentiment improved significantly in Q2. Insider Monkey’s data shows that 81 funds had disclosed a holding in Valero Energy Corporation (NYSE:VLO) in Q2 compared to 67 in Q1. Notable movements include AQR Capital Management‘s $526 million stake, which marked a 192% jump, and Two Sigma Advisors, which exited the position.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

On September 14, UBS analyst Atul Maheswari upgraded the stock to a Buy, highlighting the potential synergies from the combination. Although the analyst lowered his price target to $107 from $111, the new target still implies substantial upside.

What the Merger Means

According to the analyst, the market is yet to price in the combined company’s long-term earnings potential fully. The merger creates an airline with approximately 195 aircraft and service on 650 routes. The expanded network should improve scale and aircraft utilization while giving the company greater exposure to leisure and vacation destinations.

Pixabay/Public Domain

The larger fleet could also provide greater flexibility to shift aircraft between markets based on seasonal demand. This could improve scheduling efficiency and asset utilization while strengthening its competitive position as the low-cost airline industry continues to consolidate.

The transaction also diversifies Allegiant’s revenue base through Sun Country’s cargo operations. This could reduce the company’s reliance on leisure passenger traffic, which tends to be more sensitive to changes in consumer spending and economic conditions.

Charter operations provide another potential source of diversification. Sun Country operates charter flights that provide a relatively stable revenue source and help partially offset weakness in consumer travel demand.

Combined Company Synergies In Play

A key part of the investment thesis is the potential for cost savings. UBS expects Allegiant Travel Company (NASDAQ:ALGT) to unlock significant synergies as the two airlines integrate their operations. Management expects approximately $140 million in annual synergies within three years following the transaction, including both cost efficiencies and revenue benefits.

However, investors should distinguish between the transaction’s potential benefits and the timing of those benefits. The market may require evidence that Allegiant can execute the integration successfully before assigning the combined company a higher valuation multiple.

Underlying Concerns to Watch

Despite the potential benefits, the merger introduces several risks. Integration could prove more difficult and expensive than anticipated, given the different fleets, networks, and technology systems at the two companies.

Meanwhile, profitability is not guaranteed when operating a large fleet. Increased capacity could intensify competition and limit pricing power, particularly if demand for leisure travel weakens.

Hedge Fund Positioning

Insider Monkey database suggests that hedge fund ownership increased during the second quarter. As of the end of the second quarter, 38 hedge funds held stakes in Allegiant Travel Company (NASDAQ:ALGT), up from 30 in the previous quarter. Donald Smith & Co. reduced its stake in ALGT by 11% to about $175.64 million, while Citadel Investment Group increased by 48% to about $76.18 million.

At the same time, short interest remains meaningful. As of August 31, approximately 2.04 million shares were sold short, representing 7.45% of shares outstanding. This indicates that a significant group of investors remains positioned for further weakness.

The Verdict

The $1.5 billion acquisition is a potentially transformative step in Allegiant’s growth outlook as it expands the network and increases fleet flexibility. However, the key question is whether the combined airline can integrate successfully, shrug off competition, and generate long-term value.

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“One of the things that happened yesterday, that kind of was obscured about all the trading worry about OpenAI, were the banks. Bank of America spoke at a conference, I think Bank of America feels, a little aggrieved about the coverage. The reason I say that is because the stock was down very large, down 5% on what could considered to be only a 1.5% EPS cut. I don’t even know if they’re going to have to do an EPS cut. The problem was, Brian did say, that this was going to be a very good trading period. Meaning that they expected a flat trading period. Now there were some people who were on the upside from that. But it was kind of interpreted as being a down trading. A down quarter on trading. It was a prediction, it wouldn’t be so bad that business were flat, when we consider the fact that what was the problem was in Asia, Bank of America Asia, not here. They’re still saying everything is in place. Should it be down 5%? Maybe it should be down 3%, maybe 2%. But I do think they’re going to be able to pull it out.”

The CEO’s remarks came after Bank of America Corporation (NYSE:BAC) had released its second quarter earnings and third quarter guide in mid-July. While the firm did not provide a Q3 investment banking revenue guide, the second quarter’s figure of $2.1 billion had marked a strong 50% annual growth. During Bank of America Corporation (NYSE:BAC)’s Q2 earnings call, CFO Alastair Borthwick did remark that  the “second quarter last year was a slower quarter for investment banking for the entire industry.”

He added that the $2.1 billion in Q2 revenue, which marked 50% annual growth, was, “if you kind of sustain that relative to what we did in third quarter of last year, which was $2 billion or so, you just don’t get the same kind of uplift in the second half. So that’s what we’ve got our minds on.”

On a broader level, Bank of America Corporation (NYSE:BAC)’s narrative, like that of other banks, is driven by its net interest income. On this front, NII grew by 9% in Q2 on the back of a 19.6% growth in revenue. Crucially, Bank of America Corporation (NYSE:BAC)’s net income growth outpaced revenue growth and sat at 27%. Not to mention, the bank exited the quarter with $4.9 trillion in Global Wealth and Investment Management balances, which provide it with diversification from the traditional banking model.

Looking at the valuation, Bank of America Corporation (NYSE:BAC) trades at a forward P/E ratio of 11.43, which is roughly in line with its peers Citigroup and Wells Fargo. Short interest as a float is negligible for the three. On the hedge fund front, 111 funds tracked by Insider Monkey had held a stake in Bank of America Corporation (NYSE:BAC) in Q2, which was higher than the 106 in Q1. A notable addition was Azora Capital‘s $238 million stake, while Marshall Wace LLP‘s $711 million stake marked a 582% jump.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“Yeah, Mike has been, I think, a beacon of rationality during this period that does not speak in any way to his previous views, that something clearly has changed.”

For Mike Wirth and Chevron Corporation (NYSE:CVX), it’s all about whether the movement in oil prices is sustainable and whether they can sustainably grow in spite of cyclicality in the energy market. On the latter front, the cyclicality has served the firm so well that Cramer has remarked on multiple occasions that the shares could very well serve as a proxy for the conflict in Iran.

As an example, Chevron Corporation (NYSE:CVX)’s second quarter saw the firm grow its revenue by 56%, its global upstream production by 20% and its US upstream production by 22.5%. Crucially, the firm reached the ‘plateau’ for production in the Permian region. Its Permian production reached one million barrels in the quarter, which has led the firm to claim that capital intensity in the region should dip by 25% in 2026 over 2025 levels. Additionally, while the business might be cyclical, Chevron Corporation (NYSE:CVX) is a top dividend stock as it has increased its dividend for 39 straight years.

The firm’s Hess acquisition has provided it with additional growth to mitigate cyclicality. Furthermore, Chevron Corporation (NYSE:CVX) also plans to grow free cash flow and earnings per share by 10% annually through 2030 at a crude oil price assumption of $70 per barrel. The growth is expected to come on the back of a 2% to 3% expansion in annual production. Consequently, the firm’s narrative depends on the execution of these goals.

Yet, the focus on oil growth can be Chevron Corporation (NYSE:CVX)’s Achilles’ Heel. The firm is primarily dependent on oil as its bread and butter, while peers such as Shell and Exxon have diversified their business to include liquefied natural gas (LNG) as well. Additionally, Chevron Corporation (NYSE:CVX)’s investments in regions such as Venezuela and the Middle East are subject to geopolitical risk and could create tailwinds with respect to the firm’s production, cash flow and earnings growth targets.

Looking at hedge fund sentiment, 101 funds tracked by Insider Monkey had held a stake in Chevron Corporation (NYSE:CVX) in Q2 which marked little movement over the 103 in Q1. In comparison, 96 had held a stake in XOM and 49 had held a stake in Shell. Looks like the hedge funds also favor Chevron Corporation (NYSE:CVX) over peers. On the valuation front, the stock trades at a forward P/E ratio of 16.26 which is higher than Shell’s 10 and roughly in line with Exxon’s 15.5. Short interest as a percentage of float is negligible on a standalone and on a comparative basis.

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Disclosure: None.

“David, I think your conference is really important. Here’s why. I had Marc Fisher, the CEO of Thermo on, not that long ago. . .I’m sorry Marc Casper, I’ll tell you what bothered me, David. We’re sitting there talking about how strong business is. And Marc Casper’s really a titan in this. And no one was listening to him, no one. Not unlike when we had Beckton Dickinson on, no one was listening, and Cardinal Health, no one was listening. When I spoke to them behind the scene, what’s changed David? For making it so that everybody’s saying the same thing that they said three months ago and now we’re listening?

“I think that what’s happened is this that, when I speak to the executives off camera, when I do that, every time, I think they just felt that the rotation into all that stuff that yesterday people fled is so strong that the only place that they could really go to sell things, would be at, you would sell a Medtronic, you would sell a Thermo, you would sell out a Danaher.”

In line with what Cramer said, while Thermo Fisher Scientific (NYSE:TMO)’s shares have performed well recently, they were down by 25% from the start of the year until mid-May. However, while Cramer attributed the share performance to the need for investors to fund their AI investments, the broader debate for the firm is also in the context of the funding recovery in the biotechnology sector. For instance, at the Morgan Stanley healthcare conference on the 15th, Casper outlined that even “though funding wasn’t super strong, it was improving. But the confidence from our customers in the emerging biotech companies really was picking up. You saw funding start to improve as 2025 progressed. Has stepped up even further in 2026.”

This funding is crucial for Thermo Fisher Scientific (NYSE:TMO) since it kicks off investigations and drug research that eventually require the firm’s products. Early signs of the recovery were also present in the firm’s second quarter report, which saw it post 5% organic growth, which was the fastest since 2021. The organic growth, along with a 13% earnings growth in Q2, coupled with the funding recovery, were also part of UBS’s September coverage of Thermo Fisher Scientific (NYSE:TMO), where the bank bumped the rating to Buy from Neutral and raised the share price target to $730 from $540. Yet, Deutsche Bank pointed to funding uncertainty when it downgraded the shares to Hold from Buy, joining the chorus of bears who point towards the funding’s cyclicality.

Looking at Becton, Dickinson and Company (NYSE:BDX), its forward P/E multiple of 12.27 is nearly half of TMO’s 23.58. Revenue growth for the fiscal third quarter at 5.4% was slower than TMO’s 10%, while organic growth of 4.4% was closer. On the costs front, Becton, Dickinson and Company (NYSE:BDX) did better through its higher adjusted operating margin of 24.9% comapred to TMO’s 22.8%. Yet, unlike TMO, for BDX, a key factor that has the bears worried is the firm’s troubles with the FDA for its Alaris system. Other regulatory troubles the firm has faced in 2026 include the recall of contaminated sodium chloride ampules and an FDA warning letter tracking a 3-week shipping hold on ChloraPrep and PurPrep products.

Looking at hedge fund sentiment, 46 hedge funds had held a stake in BDX during Q2, while the figure was 51 for TMO. Given BDX’s regulatory problems, the fact that its short interest as a percentage of float of 4.47% is higher than TMO’s 1.54% is unsurprising. Notable hedge fund exits from BDX in Q2 included Millennium Management and Two Sigma Advisors while Greenhaven Associates added an $859 million stake.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“I think that what’s happened is this that, when I speak to the executives off camera, when I do that, every time, I think they just felt that the rotation into all that stuff that yesterday people fled is so strong that the only place that they could really go to sell things, would be at, you would sell a Medtronic, you would sell a Thermo, you would sell out a Danaher. The only one that wasn’t doing really well in that period was Danaher, that was a good source of funds. These other companies were doing really well. You know, Carl, the amount of money that was going into anything data center was so strong, that if we see any flow back whatsoever to any of these other areas, I mean Cardinal Health is down four today, now it’s down three and a half, I would call that stupid. Cardinal Health had a great quarter, it went to two fifty and change when it reported. These are the companies I’m far more interested than I am in refilling my semiconductor lot. . .”

Cardinal Health (NYSE:CAH)’s fiscal fourth quarter earnings reported in August saw the firm’s profit per share of $2.91 and full year 2027 profit per share guidance of $12.40 to $12.60 beat analyst estimates of $2.91 and $12.04. The demand for branded and specialty drugs helped the firm’s pharmaceutical business, which grew revenue by 6% annually to $55.4 billion.

Yet, the firm’s Q4 revenue of $63.67 billion missed analyst estimates of $65.03 billion. On the profitability front, Cardinal Health (NYSE:CAH)’s pharma business grew its profit by 21% to $645 million. With an overall strong performance, the only headwinds can occur from the Inflation Reduction Act’s drug pricing charges and EPS normalization from the boost received by tariff refunds in the fourth quarter. Cardinal Health (NYSE:CAH)’s management has also cautioned to be ready for normalization, with CEO Jason Hollar commenting at the Morgan Stanley 24th Annual Global Healthcare Conference:

“A few reasons why, specialty at 25% growth for us, that is really strong volume. Part of that driven by the M&A, part of that driven by some new customer conquests. Those are the types of things that are going to happen at a lower rate going forward and why we think it is more prudent to have a more normalized type of growth rate.”

As for Danaher Corporation (NYSE:DHR), the shares have struggled when compared to Cardinal Health, as they are down by more than 7% year-to-date. There are several reasons behind the firm’s poor performance. For instance, Danaher Corporation (NYSE:DHR)’s second quarter earnings appeared to be solid on the surface, with profit per share beating analyst estimates. However, the firm also deferred $100 million in revenue from Q2 and Q3 to fiscal 2027 and cut the high end of its full year revenue growth to 4% from 6%. With one main narrative driver in the biotech sector being spending recovery, Danaher Corporation (NYSE:DHR) disappointed on the wrong metric.

Looking at the valuation, Danaher Corporation (NYSE:DHR)’s forward P/E ratio of 22.47 is higher than Cardinal’s 18.48. So is the hedge fund interest, with 108 funds having held a stake in the firm compared to CAH’s 63 in Q2. However, short interest as a percentage of float is higher for CAH at 3.34% compared to Danaher Corporation (NYSE:DHR)’s 1.54%.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“Now Costco raised, Costco limited, one other thing, in the last couple of years, they limited bars of gold. And I think it’s interesting to say that oil is not only the new gold, but it supplants gold, again, when you do these things, and I wish Costco had not done that, it breeds hoarding. David, if we could hoard motor oil, if some places could hoard oil and expect it trades higher, then we’re going to be in a real spiral, and I think the President’s going to be surprised, well the President doesn’t pump a lot of gas.

“I wonder if the Fed chief respects the fact, that there is a dynamic where everything could change and we would have a decent reversal and a decent reversal would make it so, I don’t know whether anybody would necessarily cut prices, except Costco, they would bring them down immediately.”

Lower prices are a major reason behind Cramer’s optimism surrounding Costco Wholesale Corporation (NASDAQ:COST). They are among the factors that he has previously relied on when defending the firm along with its ability to use scale to its advantage. However, in his morning appearance on September 3rd, Cramer did take a slightly different approach as he wondered “whether this is the Costco of old.”

The broader narrative for the membership retailer is whether its new initiatives and alternative growth streams justify the valuation. After all, Costco Wholesale Corporation (NASDAQ:COST) is trading at a forward P/E ratio of 45, which is above the historical average of 34. While the valuation could be rich, it’s not like the firm isn’t growing. For instance, in August, Costco Wholesale Corporation (NASDAQ:COST) grew net sales by 9.9% and comparable sales by 8.4%. Additionally, the 16-week sales figure marked an 11.3% growth, which was roughly similar to the 11.3% growth in its fiscal Q3.

For its high growth business, the third quarter saw Costco Wholesale Corporation (NASDAQ:COST) grow digital same-store sales by a stronger 21.5%, which were boosted by the site and application traffic growing by 37%. Not to mention, the firm’s AI-powered personalization carousels generated $970 in digital revenue across Q2 and Q3 to indicate that the growth busineses are firing on all cylinders.

Yet, at the same time, with total Q3 revenue being roughly $70 billion, the figure is a drop in the bucket for Costco Wholesale Corporation (NASDAQ:COST) as the primary bread-and-butter is still the physical store. Like other retailers, margins are tight with merchandise margins dropping by 21 basis points to 11.04% in Q2, with worldwide renewal rates remaining static. Several quarters have also discussed Costco Wholesale Corporation (NASDAQ:COST)’s hesitancy to raise membership fees.

As for the hedge funds, 104 and 107 hedge funds had held a stake in Costco Wholesale Corporation (NASDAQ:COST) in Q2 and Q1, according to Insider Monkey’s data. Short interest as a percentage of float is 1.7%.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

“I have been selling a lot of data center, going into last Thursday’s meeting. I’m not looking to pick em back. I don’t want to just go buy them. I don’t want to go buy Corning, where Corning, it dropped 25 dollar. I don’t want to buy it. I want to wait until it goes lower.”

One major reason behind Cramer’s earlier optimism about Corning Incorporated (NYSE:GLW) was the firm’s potential to replace copper in data centers with glass. For instance, by October, he remarked that This is the finest glass maker in the world,” when referring to the firm. Then, in January, Cramer turned a bit cautious and commented that “Corning. . .potential winner.”

Looking at the optical business, the firm’s optical communications business grew revenue and net income by 32% and 77% annually to sit at $2 billion and $438 million during the second quarter. Additionally, during the earnings call, Corning Incorporated (NYSE:GLW)’s management shared that its enterprise sales grew by 65% annually to $1.27 billion. For comparison, during the quarter, the firm’s revenue and net income grew by 17% and 30% to indicate that the enterprise tailwinds were faster than the broader growth. As an added bonus, Corning Incorporated (NYSE:GLW)’s solar business also grew strongly, courtesy of its 90% sales growth to $438 million.

At the same time, just as is the case with the broader technology market, Corning Incorporated (NYSE:GLW) is also experiencing a divergence between its smartphone and enterprise businesses. As part of the earnings, the firm’s CFO outlined that its smartphone business should be weaker than usual in the year’s second half due to the red hot memory prices stemming from AI demand. Additionally, bears were shaken by Corning Incorporated (NYSE:GLW) announcing a $2 billion equity raise as they wondered whether the firm could experience an enterprise slowdown. Looking at Cramer’s remarks, it appears that he too belives Corning Incorporated (NYSE:GLW) is set to go lower. The stock is up by close to 3% since markets closed on the 15th.

Even though its business is more diversified, Corning Incorporated (NYSE:GLW)’s forward P/E ratio of 34.72 is not markedly lower than Lumentum’s 42.19. Hedge fund sentiment jumped to 99 funds in Q2 over the 91 funds in Q1. Notable additions in the quarter included Atalan Capital‘s $152 million stake.

READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.

Disclosure: None.

The stock rallied alongside its crypto treasury and counterparts like Bitdeer Technologies, MARA Holdings, Sharplink Inc., Hyperliquid Strategies, Riot Platforms, and Bitmine Immersion, among others, helped by the Securities and Exchange Commission’s (SEC) five-year temporary approval to allow trading of tokenized stocks 24/7, effective immediately.

For illustration purposes only

Innovation Exemption

Called the Innovation Exemption, the new rule provides certain trading platforms and liquidity providers to facilitate tokenized stock trading, provided that holders of stock tokens must retain the same rights they would have with traditional equity holdings, and companies must be able to object to having their securities represented as tokens.

Investor optimism spilled over to crypto-heavy stocks as the move signaled the government’s growing optimism and adoption of digital assets.

“The Innovation Exemption is designed to resolve challenges that have prevented responsible innovation from taking root in the United States while providing investor protections and market integrity standards,” SEC Chair Paul Atkins said in a statement.

Ray of Hope

The SEC’s move sparked a beam of good news for the overall digital asset industry, a few days after the US Senate decided to block the long-awaited Clarity Act.

The measure would have established clearer rules for how digital assets, including tokenized securities, are classified and regulated.

In a 49 to 50 vote, senators voted to reject cloture on the motion to proceed.

The bill faced several challenges, including disagreements over the language around ethics rules that would prevent government officials from profiting from digital assets.

Next Week’s Potential Catalyst

Investors and cryptocurrency traders are expected to watch out for further updates for the industry next week, as public and private stakeholders gather for the CoinDesk Policy and Regulation conference on Tuesday, September 22.

Among officials expected to take part in the discussion are Senator Kirsten Gillibrand; Congressman French Hill, who also chairs the House Financial Services Committee; Congressman Ritchie Torres; SEC Chief Counsel of the Crypto Task Force Taylor Lindman; and Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets.

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While we acknowledge the potential of MSTR 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.

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