Should You Dump Microsoft and Nvidia? Cramer Says Hold Tight

TLDR

• Jim Cramer maintains bullish stance on Magnificent Seven stocks despite sluggish 2026 performance
• Storage companies like Micron surging due to AI-related memory chip shortage
• Market rotation favoring storage sector over big tech giants like Microsoft and Nvidia
• Only two of eight major tech stocks showing positive returns this year
• Cramer expects investor money to return to Mag 7 once storage rally ends

Jim Cramer remains committed to the Magnificent Seven tech stocks. The CNBC host shared his outlook Thursday despite weak performance from most of these companies in early 2026.

The Mag 7 includes Amazon, Alphabet, Apple, Microsoft, Meta Platforms, Nvidia, and Tesla. Broadcom often joins this group as an eighth member. Only Amazon and Alphabet show gains for the year so far.

Alphabet Inc., GOOGL

Cramer explained why he’s keeping his positions. “I think that the money will ultimately flow back to most of the Mag 7 because these companies just have too many levers, too much money,” he said on Mad Money.

The host pointed to smart leadership and diverse revenue streams. These factors make the tech giants hard to bet against long-term.

Storage Stocks Draw Money From Big Tech

A major rally in storage and semiconductor equipment stocks is pulling capital away from Mag 7 companies. This sector rotation explains much of the big tech weakness.

Micron leads the storage surge with a 39% year-to-date gain. The stock doubled over three months. Memory chip shortages for AI computing drive these gains.

Seagate, Sandisk, and Western Digital also posted strong rallies. These companies now control pricing due to supply constraints. Customers have no choice but to pay higher prices.

Cramer compared the situation to buying gasoline during an oil shortage. Companies need storage for AI operations regardless of price. This gives storage makers extreme pricing power over buyers.

Why Cramer Sees Mag 7 Recovery Ahead

The Mad Money host believes current storage prices can’t last. High prices eventually solve supply problems. When storage stocks peak, investors will look elsewhere for returns.

That’s when Cramer expects rotation back into Mag 7 stocks. These companies remain leaders in the AI revolution. Their fundamental strength hasn’t disappeared during the storage rally.

The CNBC host sees the current moment as temporary. Market cycles move between sectors regularly. Storage attracts attention now but big tech built lasting competitive advantages.

Cramer emphasized the financial resources of Mag 7 companies. They have multiple ways to generate growth and profit. Smart management teams can adapt to changing market conditions and capitalize on new opportunities as they emerge in the technology sector.

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