Financial Guru Says It's Not Too Late to Buy These 4 Soaring Memory Stocks

CNBC financial program host Jim Cramer said on Monday (17th) that the AI boom has rewritten the rules of the memory industry, and the recent surge in memory stocks may not yet be over.

Cramer admitted, "I admit I didn't get in early, but I don't think it's too late now."

Year-to-date, memory stocks have been among the biggest beneficiaries of the AI investment frenzy. Cramer pointed out that SanDisk (SNDK-US) has surged 653%, Seagate Technology (STX-US) has risen 261%, Micron Technology (MU-US) has climbed 254%, and Western Digital (WDC-US) has gained 211%.

Such astonishing gains would normally raise red flags, especially considering the memory industry's historical cycles. In the past, memory manufacturers often aggressively expanded capacity during periods of strong demand, eventually leading to oversupply, which caused memory prices, profits, and stock prices to plummet.

However, Cramer believes this cycle is different. "Memory is now so severely constrained that Elon Musk is talking about it on X, saying memory has become the primary bottleneck for data center expansion."

More importantly, Cramer argues that memory manufacturers have become far more disciplined. Instead of aggressively expanding capacity as they did in the past, they are increasingly signing long-term agreements with customers, locking in orders and attractive profit margins for several years ahead.

He said, "They're basically building capacity only according to customer demand."

Cramer also highlighted share buybacks as further evidence that the industry has learned from past cycles. SanDisk still has $15.5 billion remaining in its share repurchase authorization, Seagate is executing its $5 billion buyback program announced last year, and Western Digital recently approved an additional $4 billion in buybacks. "They're using that money to return value to you, the shareholder, rather than investing in new capacity."

While Cramer acknowledges that entering after such massive price increases may feel uncomfortable, he believes strong AI demand and long-term customer contracts can still support further gains. "I think as long as data center growth doesn't slow, Micron's stock could potentially double again before this rally ends."

He admits that data center construction may eventually slow and manufacturers might once again over-expand capacity. But he sees no sign of overcapacity happening in the near term, so he asks, "Why not hold one of these memory stocks?"

"Sometimes the opportunity is just too big to ignore."