Mad Money w/ Jim Cramer 5/14/26

Summary

Mad Money w/ Jim Cramer – May 14, 2026 Episode Summary

Episode Overview

Jim Cramer brings his trademark energy to dissect the blockbuster IPO of Cerebras Systems and what it means for investors in the current red-hot AI semiconductor market. Cramer draws stark comparisons to the dot-com bubble, argues for investor discipline, and advises caution amid euphoria. The episode features in-depth interviews with Charles Schwab CEO Rick Werser about the firm's growth and innovation, and Trane Technologies CEO Dave Regnery on the data center buildout. Cramer closes with reflections on Nvidia, U.S.-China tech tensions, and his fast-paced Lightning Round of stock takes.

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Key Discussion Points & Insights

The Cerebras IPO and Valuation Mania

• Cerebras Systems' Record IPO:

  • Priced at $185/share (up from an initial range of $115-125) amidst massive demand.
  • Opened at $350, peaked at $386, closed at $311, implying a valuation that soared from $8B (Oct 2025) to as high as $107B on day one ([01:36]-[01:49]).
  • Revenue for all of last year: $510 million.

• Cramer's Reaction and Bubble Warnings:

  • “There is a word for that. That word is fanciful… I didn’t say idiotic... But that would be judgmental.” ([01:49])
  • Cerebras traded at up to 230x sales at its high, vastly exceeding peers like Nvidia or SK Hynix.
  • Draws direct parallels to the behavior of market participants during the 1999-2000 dot-com bubble, highlighting reckless market orders and investor ignorance (“They just smelled a sure thing… They didn’t know what it was anyway.” [03:55])
  • Cramer recounts historical IPO frenzies and subsequent crashes, urging current investors not to repeat those mistakes ([05:00]-[08:07]).
  • Memorable quote: “If I saw this kind of nonsense, this overenthusiasm again, I would scream from the rafters that this has to stop. I would simply stop praising the red-hot sector for a moment and say: this ends badly.” ([07:53]-[08:07])

• Valuation Breakdown:

  • At the close price, Cerebras was about 187x sales vs Nvidia's 26x, AMD’s 21x, Broadcom’s 33x; plus, those peers are all profitable ([22:40]-[27:00]).
  • Cerebras put up impressive growth numbers (269% in 2024, 76% last year) but is still losing money.
  • “The story of the company, not the stock. They're two different things.” ([29:24])
  • Cramer's recommendation: “Keep your bat on the shoulder and hope the stock gives you a giant, giant pullback. Because at these levels, no, it's too rich for me.” ([29:31])

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Market Context: Nvidia, Cisco, and the AI-Industrial Boom

• Nvidia’s Unusual Value:
  • Nvidia rallied 4.4% on the day, and Cramer notes, "There's a very good chance Nvidia stock is now cheaper than the average stock in the S&P 500... Now that's crazy." ([07:21])
• Cisco’s Justified Run:
  • Reports strong sales and earnings, deserving a 13% rally vs. the dot-com era’s bubble-like moves.
• Data Center Wave:
  • Numerous industrials (like Trane Technologies) benefit as demand for data center infrastructure spikes.

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Charles Schwab: CEO Interview with Rick Werser ([12:51]-[20:50])

• Growth Amid Unloved Stock:
  • Schwab raised revenue guidance from 10% to 14-15%.
  • Werser: “We've grown the top line 14% a year and the bottom line 16% a year for the last 10 years… Our clients are increasingly bringing new assets to us.” ([15:01])
• Retaining and Educating Young Investors:
  • Programs like teen accounts (13-17) promote investing over gambling.
  • “We want to give a message... that markets have positive returns over time, whereas gambling, not so much.” ([16:03])
• Crypto on Schwab’s platform:
  • Supported for client choice but not included in recommended asset allocations ([17:21])
  • "We're not including crypto, but we have our platform, and if people want it... they certainly can include it." ([17:40])
• AI Threats Overblown:
  • Addressed concerns about AI disrupting Schwab’s business model (“Our clients have never been more satisfied. So we think the strength of our value proposition is winning in the marketplace.” [19:28])
• Market Underappreciation:
  • "We're trading at 12.5x next year's earnings for a company that's grown 16% a year for the last 10 years. That should be rewarded in the market." ([19:49])

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Data Center Infrastructure: Trane Technologies CEO Interview ([32:07]-[39:13])

• Data Center Demand Driving Growth:
  • “Our backlog... at the end of the first quarter is $10.7 billion. That's just equipment. And remember a third of our business is services.” ([32:56])
  • Service business: Compound annual growth rate in "low teens" over 7 years.
• Mission-Critical Nature:
  • Data centers cannot afford downtime; Trane’s technicians are pivotal ("We bring every technician through our training center twice a year." [32:56])
• Sustainability Focus:
  • 30% of world’s energy goes to buildings, 40% of which is for heating and cooling – huge energy savings are possible ([35:05])
  • “Most buildings waste about 30% of the energy they pay for... That’s the opportunity Trane helps with.” ([36:00])
• Reshoring & Regional Manufacturing:
  • 95% of U.S. sales are manufactured domestically; investment in U.S. jobs.
• Future Outlook:
  • Data center pipeline “more robust than I've ever seen it before… a lot of demand for the foreseeable future.” ([38:32])

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Lightning Round Highlights ([40:24]-[43:15])

• Rapid-fire Stock Takes:
  • GE & Boeing: Both are good buys on recent declines ([09:19])
  • Marvell: “Matt Murphy's doing an amazing job... It can go higher.” ([30:11])
  • Silicon Motion (Simo): Likes it, would be a gradual buyer ([41:40])
  • Wynn Resorts: Hold off due to Gulf issues ([41:43])
  • Design Therapeutics: Pure speculation, high risk ([42:22])
  • Billion to One: “It's a real company. I say buy it.” ([42:52])

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Reflections on Nvidia, China, and U.S. Policy ([44:16]-[47:59])

• U.S.-China Tech Rivalry:
  • The debate over letting Nvidia sell chips to China; potential risks vs. American technological leadership.
  • “Our lead is substantial... If you can get China hooked on an inferior version (of Nvidia’s chip), I say have at it." ([44:16])
  • Power is a gating factor for AI growth in the U.S.; China has fewer constraints.
  • “If [the President] sides with Jensen [Huang, Nvidia CEO], he's backing American leadership and ingenuity, which is exactly what the hardliners should want. They just don't understand the stakes.” ([47:30])

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Notable Quotes and Memorable Moments (with Timestamps)

• On Cerebras IPO Mania

  “That word is fanciful because it was fanciful to pay that much the whole time… I didn't say idiotic. I didn't say stupid… But that would be judgmental.” – Jim Cramer ([01:49])

• On 1999 Parallels

  “See, you uninformed people using market orders to pay anything for an unseasoned company… it was a mania.” ([03:25]-[05:17])

• On Risk and Investor Discipline

  “If I saw this kind of nonsense, this overenthusiasm again, I would scream from the rafters that this has to stop… this ends badly.” ([07:53]-[08:07])

• On Schwab’s Client Focus

  “We deliver for our clients the products, the solutions, the expertise they need to live their best financial life.” – Rick Werser ([14:07])

• On Young Investors

  “The young investor is a thoughtful investor… why in the world would we pull back? We're saving for retirement 40 years from now.” – Rick Werser ([16:03])

• On NVIDIA’s Value

  “There's a very good chance that based on forward earnings estimates, Nvidia stock is now cheaper than the average stock in the S&P 500… that's crazy.” – Jim Cramer ([07:21])

• On Data Center Buildout

  “Our backlog at the end of the first quarter is $10.7 billion… and it's just equipment. A third of our business is services.” – Dave Regnery ([32:56])

• On U.S.-China Tech Debate

  “If you can get China hooked on an inferior version, I say have at it… If he sides with Jensen, he's backing American leadership and American ingenuity.” – Jim Cramer ([44:16]-[47:30])

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Key Segments & Timestamps

• Opening Cerebras IPO Analysis: [01:30]-[08:30]
• Schwab CEO Rick Werser Interview: [12:51]-[20:50]
• Cerebras Deep Dive & Valuation Comparisons: [22:40]-[29:30]
• Caller Q&A on GE, Boeing, Marvell, etc.: [29:54]-[30:47]
• Trane Technologies CEO Dave Regnery Interview: [32:07]-[39:13]
• Lightning Round: [40:24]-[43:15]
• Nvidia, China, and Global Chip Policy: [44:16]-[47:59]

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Final Insights

• Cramer’s Bottom Line:
  • Cerebras is a great company, but the stock pricing is "absurd" due to bubble-like investor behavior.
  • “Company and stock are NOT the same thing.”
  • Wait for sanity to return: "Keep your bat on the shoulder."
• AI Boom Winners:
  • Nvidia, Cisco, and asset-light infrastructure players like Trane are the legitimate, justified beneficiaries.
• Market Wisdom:
  • “Discipline matters.”
  • Learn from history – avoid repeating dot-com era mistakes.

---

This episode is a masterclass in keeping cool amid market euphoria, with cutting analysis, memorable metaphors, and calls for responsible investing—classic Cramer for the AI-driven bull market era.

Transcript

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[Jim Cramer]

My mission is simple to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere, and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramer.

Oh, do I make friends? I'm just trying to make it a little bit of money. My job is not just entertain, but do some teaching.

So call me at 1-800-743- CNBC.

Tweet me, Jim Kramer. All right, we had this IPO today. Seven director company cerebras price at 1 85.

Stock opened at $350. Instantly make it worth $107 billion on

a fully diluted basis.

And it goes all the way up to 386.

Foreclosing at 311. Now, there is a word for that.

That word is fanciful because it was fanciful to pay that much the whole time. And that's putting it diplomatic notice. I didn't say idiotic. I didn't say stupid as much as

I'm certainly itching to do so. But that would be judgmental. On a day where The Dow gained 370 points, the S&P advanced 0.77% and the Nasdaq climb 0.8%, we had to

witness this already overvalued stock come public at 111 times.

Last year's sales, not earnings, sales.

And it blew through that level with ease.

That wasn't enough. Instead, the crowd went to north of 230 times sales.

230 times last year. Sales at its high. That's just great. Listen, I've been in favor of the semiconductor rally the whole way. I mean, has anyone been a bigger cheerleader for the thing? I. I mean, cheerleader album for the Data Center. I love the data center.

The Fourth Industrial Revolution Nvidia CEO Jensen

Wong promotes Hook, Line and Sinker.

But today. Today's IPO made me sick to my stomach. Oh, I got nothing against the company. In fact, Cerebras has good technology, especially when it comes to inference.

It competes admirably with Nvidia. It has to deal with OpenAI for $20 billion.

Something with Amazon Web Services too.

CEO on Squawk today.

Smart fella. It doesn't matter because today's action was right out of 1999. And you know, I've been reluctant to use that term. See, you uninformed people using market orders to pay anything for an unseasoned company

that was valued at just $8 billion back in October. 8 billion in October. $95 billion today. You can't be serious. Did it cure cancer? While I figured that maybe it was

what, growing the inference I might have missed that. I cannot tell you how many times we saw something exactly like this happen in 1999.

Over and over again. People were willing to do this nonsense endlessly.

They heard something was sizzling hot. They knew the sector was steaming too.

So they put in market orders,

not caring what they paid. You know why?

Because they didn't know what it was anyway.

And they just smelled a sure thing.

Since back. High Bandwidth memory HBM chips.

This is potato chips, not real chips. Potato chips. But I got them at the Nvidia trade show known as gtc. The chips, the real ones, are made by SK Heinetz, which is an incredibly important data center, semiconductor company, Korean Colossus. Market capitalization of almost a trillion dollars. It's not the closest comparator to Cerebras, but It's close enough.

SK Hynix sold $335.5 billion worth of chips last quarter. Cerebras sold $510 million worth of chips in the entirety of last year. That kind of volume, it is very

hard to justify Cerebras being worth a hundred billion dollars.

I bring these up because it's a

joke and I don't want the joke played on you. You cannot do this, people. You cannot pay these prices.

I Remember back in 1999, I was writing for TheStreet.com since I'd co founded four years before.

I'd plead that people not to use market orders. Street.com came public. I urge that people not buy things they didn't understand because these were stocks that were just way too hot and there were too many people who didn't know what they were doing. That was a mania. So far we haven't had mania.

People ended up losing fortunes in that mania when the whole dot com edifice collapsed in March of 2000.

Of course cerebras is not gonna blow up like those 300 landmine companies that

came public between 1999 and mid 2000 before it collapsed and they all vanished pretty much.

This is a real business we're talking about. There were plenty of real businesses with stocks that got way too hot in the dot com era. Could the bankers have done something to control the situation?

You know I never mind criticizing the underwriters if I think they screw up. I've attacked them for years.

Morgan Stanley ran this deal and you know what? I gotta tell you they did a great job.

They originally looked to sell the stock between 115 125.

Then they kept moving it up because they saw the insatiable demand for this thing. But they weren't gonna price it anywhere near where the rabid buyers picked up the stock during the day. They had no choice but to leave money on the t willing to price the deal at a totally unjustifiable price.

They weren't going to do that.

Quite the opposite of 1999 where many

bankers were anxious to bring anything public.

Cerebrus is a real company. There had to be a price put on the darn they had to, right? I mean couldn't just not have a price.

And $185 seemed reasonable.

Anything over $300 seems nuts now. Maybe there'll be another big wave of buying.

I mean there was with Figma before

it went down and now Fig report a good quarter for close. Maybe Cerebras will win a huge contract

for 40 billion from anthropic or Microsoft.

It'll all be well. Otherwise though we could go down the rabbit hole. What a shame. It took away from the extraordinary performance of Chuck Robbins and Cisco showed an incredible acceleration, both sales and earnings. Cisco was the largest company in the world in the peak of 2000. It was selling it to all the big customers at the time. The companies that were building out the Internet with massive amounts of fiber. A lot of it never got lit. A lot of the customers didn't have enough money to pay again investors Lost fortunes with Cisco back then. This time Cisco deserved the run. Today's 13% rally was completely justified and then some. It wasn't. It wasn't a mania. It wasn't fanciful. How about Nvidia? Look, it's finally moving up. It's 4.4% today. Good reason. There's a very good chance that based on forward earnings estimates, Nvidia stock is now cheaper than the average stock in the S&P 500.

Cheaper? Now that's absurd.

The company's growing at a much faster pace than almost any large cap enterprise.

And it sells below an S and P market multiple.

Now that's crazy. Now it doesn't have to be this way. People. Perhaps there are people who will say, look, I've been there. I lost so much money when the IPO market got too hot in 2021 or 21, 2014 or when it was totally overwhelmed in 2000. But my fear is that was now too long ago. And they're just not enough losers from then who know, who know not to repeat those mistakes. Maybe we just have to live through it again. I'm trying to stop it. I know this. I always said that if I saw this kind of nonsense, this over enthusiasm again, I would scream from the rafters that this has to stop. I would simply stop praising the red hot sector for a moment and say this ends badly.

Please, please exercise discipline.

Understand what these companies do and why

they aren't worth this. Here's the bottom line. I don't mind stocks that go up usual on shortages. I don't think Micro or Sandisk or

Western Digital or even HBM chips from

SK Hynix are overv Friday.

The Chinese don't flood our markets with cheap memory. Cisco, Nvidia, fine with me.

But Cerebras, it's like a Sondheim play sending the clowns.

Because today that's exactly what happened. Ian in Florida.

[Caller]

Ian, Booyah. Jim, how you doing?

[Jim Cramer]

I am doing well, Ian, how are you?

[Caller]

Amazing. Amazing, Jim.

[Jim Cramer]

Amazing. I love that.

[Caller]

Going good. I'm a five time caller and a club member as well.

[Jim Cramer]

Oh, thank you, thank you. You know how hard we try to do this.

Jeff Marshall and I, we got some

good names coming up.

What's happening?

[Caller]

Yeah, you do great, Russ.

[Jim Cramer]

Thank you buddy.

[Caller]

Jim, I wanted to ask you about. It's kind of an aerospace stock. It seems to be kind of in dimling in the middle right now. But I like the company. What do you think about ge? Is it a good time to buy?

[Jim Cramer]

Buy GE is Larry Culp, I've been watching the stock go down and I'm like, all right, come on, come on. And by the way, I'm gonna throw into Boeing. You're down 11. Why? Because it was up in anticipation of a big order. I mean, you know what I mean? Look, stocks don't go up and up and up. Not real ones at least. And Boeing's good and GE's good. And thank you. Remember the club. And please, people, be careful. I don't mind stocks go up on shortage, but the action we saw today

on Cerebras, that's got me on board.

I'm just on guard. I just, I'm worried. I am worried. I'm in money. Tonight, Charles Schwab outlined new revenue growth targets at its investor day. And I'm getting the latest on the road ahead for the financial services leader, which seems very inexpensive to me.

And Cerebras just came public in that

large ipo, so should you be buying something else? These?

I don't know.

I'm going to give you my take. And Trane Technologies helps keep data centers nice and cool. So does that explain why stock has been red hot recently? I'm finding out more from the company's top brand, so stay with Kramer.

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[Jim Cramer]

Okay, how could the stock of Charles Schwab get its groove back? Especially just a few months ago, this retail brokerage firm seemed unstoppable with the stock hitting a new all time high in early February. That seemed right to me. Then it got knocked down during the recent AI displacement sell off, even though it's really not an AI victim at all. Then the stock got hit again last month when Rob reported even though the numbers were better than expected, it was a very good quarter. Today the company hosted an Institutional Investor day where they raised their full year revenue growth forecast pretty substantially went from 10% to more like 14 to 15%. Yet the stock actually got hit again, down 1.9% in part because management also predicts higher expense growth. Look, I think the market's misjudging this one and not valuing this incredible franchise correctly at all. But do not take it from me. I got a chance to sit down with Rick Worser, he's the President CEO of Charles Schwab to get a better read on the situation.

Take a look.

[Rick Werser]

Jim, I'm doing great. How are you?

[Jim Cramer]

Well, you know, I'm confused.

I'll be honest, I thought the through the client's eye strategy is great.

The numbers that you presented were much

better than I thought and yet the stock did not react. And I'm wondering what I'm missing because as far as I can see, you're doing everything right.

[Rick Werser]

Jim, our business is certainly performing exceptionally well and it does start with seeing through client size. What we focus on every day as a company is making sure we deliver for our clients the products, the solutions, the expertise they need to live their best Financial life. And by the way, Jim, it's one of the reasons that I admire Mad Money. You have done a lot for the retail investor to help them understand the power of owning stocks being invested, the value of compounding. We're trying to do the same thing here at Schwab, and it's working. You might not see it in our stock, but you certainly see it in our business fundamentals.

[Jim Cramer]

Well, those of us who started and

cut our teeth on Schwab know that's exactly the way you've been, how the Travel Trust was set up with it. I just think you guys have the right orientation. And what's terrific is you raised as you had 10% revenue growth, you had to 14 to 15% top line growth. And that to me shows that you're

doing really everything right.

[Rick Werser]

Yeah, our business really is operating at a high level right now. For the last 10 years, we've grown the top line 14% a year and the bottom line 16% a year. And that's because we're doing right by the client. We see record client satisfaction scores with our clients. They're increasingly bringing new assets to us and they're also doing more business with us in areas like wealth and lending. They're coming to us saying we want more help from Schwab and that's accelerating our business as well. So it's all. We're operating on all cylinders here and doing everything we can to delight clients, and it's working well.

[Jim Cramer]

You guys are also doing something.

Thank you for the kind comments of Mad Money. Another thing you're doing is very much

in sync with me, was that you're

trying to get young investors to own, trying to get them to understand I

try not to play trying to invest.

How are you able to do that? Because I think you've got some. You've got some options for people, particularly for parents, to try to get young investors involved that I think are reasonable and make it so that people understand that investing can be fun, but it's serious business.

[Rick Werser]

Jim, we share a passion with you which is trying to get Americans to invest, to save, to understand the power of compounding and the impact it can have on your financial life over time. We are doing a lot for the young investor. And I'll. And I'll tell you, the young investor is a thoughtful investor. I sat with a group of young investors a month ago and it was during a period of high volatility and I asked them whether they were worried and pulling back on markets. And they said, why in the world Would we do that? We're saving for our retirement 40 years from now. We're sticking with it, and we're adding, as the opportunity comes along. We just did launch teen accounts for young investors ages 13 to 17. And that was really important to us to send a market, a message to young people in our country about the power of being an investor, particularly in an environment where lots of young people are getting a message about gambling. And we want to give a message about the fact that markets have positive returns over time, whereas gambling, not so much.

[Jim Cramer]

That's very true. Now, Rick, the one thing that I,

and I'm sure you wrestle with, too, we want to give the clients through their eyes, what they want.

And sometimes we have to give them

stuff, and it may not be what we want. For instance, in your digital assets page

of your terrific deck today, you've got

a rollout of a spot crypto offer

that's begun with an employee launch. Initial coins available. Now, for me, I know that they

want it, and so I would have to give it to them.

But candidly, Rick, it's not the kind of thing I want to see them do. What do you do when you have

kind of a conscience issue, but, you know, the customer's always right?

[Rick Werser]

Great question, Jim. What. What we've focused on is client choice. We've always stood for having what investors may want or need to have a balanced asset allocation. And there's many investors that can make a credible case for why crypto could make sense in their portfolio. What we're not doing, though, Jim, to your point, is we're not putting it in our recommended asset allocation. So when a client comes through the door and says to us, you know, my age, what should my mix of assets be? We're not including crypto, but we have our platform, and if people want it, they think it's an important part of their asset allocation, they certainly can include it.

[Jim Cramer]

Okay.

All right.

I think that that answers it, and

I think that's great. It's what you're.

You're offering everything, but you're not necessarily

emphasizing everything, which is terrific.

Now, a lot of people feel, Rick, that you guys, maybe it's this AI

issues you have that people are going

to go around and look at whatever rate is like the best. And you know what? I studied that for CDs, and it's really not true. And I have affiliates. Not true for you either. But it's something that investors claim is

a concern for Schwab.

[Rick Werser]

Yeah, there's. There's been an AI narrative that has overhung our stock now for a few months. And first it was that was there was going to be an AI tax tool that was somehow going to disintermediate our business. And now the focus has been on our cash strategy, which is an area where we. When clients come to us, they come to us to invest and trade. We put their money in a cash sweep vehicle so that it's ready for them to invest when and when they want in what they want. That strategy has been working for us, but there's concerns that AI is going to somehow make it go away. We think those are overblown. Our strategy is working. We shared metrics today that showed we've never been more competitive than we are today and our clients have never been more satisfied. So we think the strength of our value proposition is winning in the marketplace.

[Jim Cramer]

So you think you have to kind of shadow box until people realize like

they did for the cybersecurity companies, everyone

thought they were going to disseminate it and then they had to go through

this eight month period of pain and

then suddenly the stocks just went up 25. I think maybe you just have to just wait.

Wait at futile.

People realize that whatever they're worried about, it's not happening.

[Rick Werser]

Jim, I think you're right. And as you know, in the short run, the market can be a voting machine. In the long run, it's a weighing machine. And we've been delivering great results quarter after quarter. We're trading at 12 and a half times our consensus earnings for next year for a company that's grown the bottom line, 16% a year for the last 10 years. So we're going to keep focus on delivering for our clients. That should lead to great financial results. Ultimately, we think that will be rewarded in the market.

[Jim Cramer]

Oh, I totally agree. I remember at 60, your predecessor was on and I was like, you're buying stock and everyone is just so panicky. If it were so bad, why would you buy? And it was the exact bottom. And I just feel like right now I don't get it. But now if you're listening to you, I get it.

There's just a lot of mistakes about how people view your company. Right now it's the same company as always as far as I'm concerned.

That's Rick Werster. He's the president and CEO of Charles Schwab, which we have license beginning of the show. You can go check it out, man. Bunny's back after the break. Thank you, Rick. Great to have you on the show.

[Rick Werser]

Thanks Jim.

[Jim Cramer]

Na buddy back.

[Mad Money Announcer]

Coming up, one of the hottest IPOs in recent memory just hit the market, so should you be buying in? Kramer offers his thoughts on Cerebras next.

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[Jim Cramer]

Today, as I said at the top of the show, got the largest IPO of the year for at least so far when Cerebra Systems came public with a bang. This is a semiconductor company that makes what are known as AI accelerators, used dinner plate sized processors that are purpose built for artificial intelligence workloads and the market lapped it up. As I said after pulling in an attempted IPO last fall when the AI cohort briefly went out of style, Cerebras refiled to come public in mid April, originally seeking to sell 28 million shares shares at a price between 115 and 125 by the beginning of this week they raised it to 30 million shares at a price of 150 to 160 because there was just so much demand. Then last night the IPO price way above that $185 per share and today the stock immediately skyrocketed, opening at $350. While it pulled back over the course of the day, it still finished the session up a staggering 68% from its offer price if you got in the deal, but well below its high of the day. Now you know that I thought the enthusiasm is way out of control here. Nothing. But let me explain why Wall street can't get enough of this thing. So at least you know the other side of my anger. Cerebras is one of the few companies that saw AI coming years and years ahead of time. Way back in 2015 they realized we need a whole new type of computer architecture for the data center. One of the big limiting factors for AI is communication speed. And because communications happens much faster on a single chip than between chips, Cerebrus develop the largest commercial chip in the history of the computer industry. Each of these things has 4 trillion transistors. It's a T4 trillion. To put that in perspective, Nvidia's super advanced B200 chip package, that's the black belt GPU. Oh, that only has 208 billion transistors, which I thought was a lot because all these transistors are packed into the same chip. Cerebras technology has become incredibly useful for inference workloads. That's when an AI platform retrieves information from a trained model and puts it to use. According to Prospectus, this company's AI accelerators can be up to 15 times faster than leading GPU based solutions. And in some unique cases, they're over a thousand times faster. Cerebras can also help train an AI model 10 times faster than the usual hardware lets you. So true advantages. They either sell this technology directly to customers or allow clients to basically rent computing power through their own cloud business. They also offer inference services through partners like Amazon and Microsoft, among others. Now last year though, Cerebras got 86% of its revenue from just two entities in the United Arab Emirates. One a cloud computing company, the other a university. The UAE is halfway to being a war zone right now, but that hasn't diminished the enthusiasm for this stock. Plus Cerebras has been making strides to diversify its business. In January, they announced this $20 billion multi year deal with OpenAI to deliver 750 megawatts of compute. In March, they reached a deal to deploy their monster chips in Amazon's data center. So these are good contracts? That's the story. What about the numbers? Like they're impressive too. Cerebras put up 269% revenue growth in 2024, then 76% revenue growth last year. Of course, the company's not yet profitable. Cerebras adjustable adjusted operating loss more than doubled last year to $96.1 million and its adjusted net loss more than tripled to $75.7 million. Their cash flow from operations is still negative, but the losses, they're not too distressing because this company's still in its growth mode and the growth is really incredible. Plus, Reverse has no debt and they just raised $5.7 billion in cash from the IPO. So hey, look, they can afford to rack up big losses for years in order to keep expanding. And I don't think they'll do that. Putting it all together, I like the story very much. The story of the company, not the stock. They're two different things. Company makes a very convincing case for the technology. And with the arrival of the infantir, Cerebras is in good position to grow like crazy. Especially now that they're winning business from OpenAI and Amazon Web Services. So it is a great company. But man, after this red hot start for the stock, it's very hard for me to get comfortable with this. Valuation at $185. The offer price three years had a fully diluted valuation of roughly 56.6 billion where it was trading about 111 times last year's sales. Not earnings, sales. Okay, that's important. Keep that in mind up here at $311, it's more like 187 times last year's sales. Sales. So now let's get the compares. You can write them down if you bought it so you know what you're doing here. Even though there is really no comparison to what they're doing. I, I like these. I'm going to give you these. Nvidia trades at roughly 26 times last year sales. AMD trades at 21 times last year sales. Broadcom trades at 33 times last year sales. Those just aren't in the same ballpark. And of course Nvidia, AMD and Broadcom have the added advantage of being extremely profitable. You can value them on an earnings basis. Even the most expensive AMD sells at 108 times last year's earnings. I don't like that, but I get it. It's getting the same multiple and earnings that Cerebras got on sales at the moment it came public. Now it's almost twice that. See, that's wild stuff. It's just, it's. Look, it's too bullish. Of course Cerebrus is getting that valuation because it's growing like a weed. But you know what? These guys had 76% sales growth last year 76. Okay, that is not that much different from Nvidia, which was a 65. So really if you buy the stock up here, you're betting on the idea that Cerebras will have much better growth in the many years in the future. Honestly, at this valuation you're basically expecting revenue to be several multiples of what it is right now in a fairly short period of time. Maybe that's possible given the company's impressive technology. That seems like a real leap of faith to me. I don't like it. Not their fault. It's the fault of non rigorous investors and traders and flippers, really. I think that what's happening here is that Sweepers has a sexy story and a perfectly timed IPO. When the companies pulled its IPO last fall, it instead raised 1 billion in the private markets at an 8 billion dollar valuation. So in other words, in the fall this was worth 8 billion. Now listen, eight months later, it's worth more than 10 times that amount today. Tell me that isn't silly. You, you who bought it, tell me you didn't do something silly today. Think of what's happened over the past couple months. The Philadelphia Semiconductor index has exploded. It's up nearly 70% in just the last six and a half weeks. Many individual companies involved in the data center builder have more than doubled over the same period. Think the memory plays or CPU specialists like AMD or Intel. And some of these smaller, more speculative companies like Neoclouds and some networking or photonics plays, they've risen several hundred percent. Against that backdrop, along comes Cerebris with its differentiated process story with chipset it claims are much faster than Nvidia and ideal for the inference era. No wonder people can't get enough of this thing. But the bottom line, while there might be a situation in the future where I can recommend Cerebras, I just can't even get close to justify the valuation up here given how much has already

run right out of the gate.

And those valuations I just gave you, I hope you wrote them down because they're just what I call dispositive from now. I say keep your bat on the shoulder and hope the stock gives you a giant, giant pullback. Because at these levels, no, it's too rich for me. You'll have to buy it up here without my blessing. I can't go back to 1999. You shouldn't either. Let's go to Barbara in California, please. Barbara.

[Caller]

Hey Jim. I've been watching you for 26 years and you have as much energy today as you did then.

[Jim Cramer]

Thank you, thank you, thank you.

[Caller]

Seriously? Seriously. Okay. You like Marvell? Do you still like Marvell?

[Jim Cramer]

Oh, yeah. Marvell's.

That's Matt Murphy.

He's doing an amazing job. He bought that optical business. He's really crushing it. I mean, you know, if you want to look at Marvel versus say what was being hyped today. Marvel so dramatically cheaper and it hit a 52 week high today. It can go higher. Remember Matt came on the show when he bought like a ton at 70 and he was really upset. Remember he came when he said listen, I am the single, not the noise. Well, he just, he gave you almost a triple.

All right, well, cerebral does look like

it's going to be great long term.

Gross, gross growth company. But I can't recommend the stock right out of the bay.

Never stock company. Okay.

Two different things. What's more, Mid Money had trained technologies known as a leader in the H Vac space. But its involvement in the data center

build out unlock a new level of growth.

I'm checking in with the CEO, then I'll break down how Nvidia fits into

the equation with our relationship with China.

As the debate heats up over its access to the Chinese market, maybe it's much into about.

Well, why don't you stick around and

of course all your balls.

[Mad Money Announcer]

Right.

[Jim Cramer]

Traffic fire in tonight's edition of the lightning round. So stay with me.

This market is full of industrials that have caught fire because they own a

piece of that great data center build out. Take Trane Technologies tt, the climate control company with a stock that's up nearly 24% for the year.

Now, a good part of that's because

it prevents these warehouses from overheating. A little over two weeks ago, Trane reported a healthy top and bottom line beat with its backlog up a staggering 30% year over year. Commercial H Vac bookings in the Americas up 40%. Applied equipment orders surging 160%.

The whole business is thriving.

But that data center side is really on fire. One reason why management raised their full year forecast convincingly. So can this thing keep running?

I got a chance to check in

with Dave Regnery, chair and CEO of

Trade Technologies, who's come on the show multiple times and this stock has been a winner. Take a look.

Dave.

Welcome back to Midmoney, Jim.

[Dave Regnery]

I'm always glad to be on your show. Thanks for having me.

[Jim Cramer]

Well, I'm thrilled you're here. I mean, it's just another great year for you and the stock's up 23% already. I guess it's pretty much when I read through the deck, almost everything you feel better about. And it's already been good, but it's getting great again.

[Dave Regnery]

Yeah, we had a, we had a very strong start to the year. First quarter our order rates have been just, you know, off the chart. I mean up 24% in the first quarter. Our backlog is at, you know, we used to talk about backlogs being record when they were at 4 billion, 6 billion. Our backlog at the end of the first quarter is 10.7 billion. And that's just equipment. And remember a third of our business is services.

[Jim Cramer]

I was going to say one time, I just was saying I like training because the service revenue is strong.

[Dave Regnery]

But that's a great, the service business, a great business. It's a third of our company. It's had a compound annual growth rate over the last seven years of low teens. Compound annual growth rate. This is a very resilient business and it's a third of our company and we invest heavily in it. We just opened up a new training facility in North Carolina, first of its kind. We bring every technician through our training center twice a year. And this is, think about, we have in the United States we have I think 4500 techs. We have another 3000 or 2500 globally. So we have 7000 techs now.

[Jim Cramer]

And now you've got some pretty much mission critical. If you go down a billion dollar

facility doesn't generate any revenue.

That's just not good. So when you're in the data center, I think those guys have to be ready every second.

[Dave Regnery]

Data center customers are very risk averse and they want to make sure that their equipment is going to work. The other thing data center customers want to do is they want to make sure that not only can you ship the equipment but you could commission the equipment on site. So a lot of our training classes is training technicians to be data center commissioning people. So what they do is they're able to go to the data center. Mechanical contractor finishes the install. We then go make sure the equipment is working the way it's supposed to be work.

[Jim Cramer]

All right, now you're in a great industry with great companies that almost all come on, how are you doing?

Wallet share versus organic growth. New from Greenfield.

[Dave Regnery]

Look, we have, our growth rates in the future are going to be fantastic. I mean think about it. I mean we've had a compounding growth rate over the last five years that's been double digits on the top line. And then on the bottom line, Jim, our EPS growth has been over 20% per year. So we have a mixture. Right. So we have Greenfield as well as we have certainly brownfields. And we do a lot of work with existing customers and we certainly are always out with new customers every day.

[Jim Cramer]

Now, when I read through your most recent deck, the last two, you're a bit of a throwback. People have the sustainability page.

Either bury it in the last one or they have the first one, then you move away and never hear about it again. I keep telling you, oh, my God,

this is just core for you.

[Dave Regnery]

Yeah. You know, our. Our purpose as a company is to challenge what's possible and innovate for a sustainable world. And I tell our employees, that's our North Star. And it might not be fashionable right now to be talking about sustainability here in the United States, but to us, we still talk about it. And the reason why we talk about it is because we have such great solutions for our customers. We save our customers fantastic amount of energy. Okay. And it also lowers their carbon footprint. Most people don't realize, Jim, that 30% of all the energy in the world goes to buildings. And 40% of that is for heating and cooling. And we know most buildings operate very inefficiently. In fact, most buildings waste about 30% of the energy that they pay for. And that's the opportunity that we at Trane Technologies help our customers with. Think about all the savings you have with 30%. Energy prices are rising. Our paybacks keep going up because we're saving our customers this wasted energy.

[Jim Cramer]

Okay?

So take me into a data center. I mean, the thing must be boiling and you gotta try to be sure that it stays cool.

What's the cost of keeping it cool?

And how do you have the equipment that can keep it 24,7 cool?

[Dave Regnery]

Well, we, we. Data center vertical is very strong for us. Okay. Although I would tell you that many verticals are strong.

[Jim Cramer]

That's fair.

And it's not fair. Focus on that, because it's true.

[Dave Regnery]

But you had a lot in the data center space. We are innovating at a pace that we have never seen before. Okay. And a lot of those innovations are for the data center vertical. However, they're coming back through core verticals as well as we make the product more efficient. And our product is some of the most efficient in the, in the world. Okay. We used, in our world, we measure efficiency by coefficient of performance, or cop. We used to think a COP of three or four was efficient. We did a job in Australia, not too long ago, the cop was north of 11. It's just. And so, I mean, the data center space is a great vertical. We'll continue to lead there, but we have a lot of other verticals. We're very strong in it.

[Jim Cramer]

Okay, but how's the problem? I mean, we don't have a lot of commercial construction. We have no residential construction to speak of. And you're still generating double digit. I don't know how you're doing it.

[Dave Regnery]

A direct sales force is a big help. Okay. We, all of our employees are direct sales, okay. That are in the sales function. And they just have an unbelievable ability to have deep domain expertise in their local markets. I was telling an analyst the other day was asking questions, I said 95% plus of our account managers or our salesforce, they don't sell to data centers, okay. They sell to other core verticals, whether it be higher ed, whether it be K through 12, whether it be healthcare. These are all verticals that we have a lot of expertise in. And our portfolio is the broadest in the industry and it allows us to be able to sell solutions to these, these customers.

[Jim Cramer]

It's also amazing. A lot of people say, well, are they going to reshort? You never left.

You're here.

[Dave Regnery]

Our strategy for decades has been we manufacture in region for region. We have 21 plants in the United States. We have one plant in Mexico. 95% plus of what we sell in the United States, we manufacture in the United States. The job creation that we have is right here in the United States. We've added over 4,000 jobs over the last five years. By reinvesting in the business, reinvesting in ourselves through innovation, and serving our customers in a way that's very important to train technology.

[Jim Cramer]

People keep saying this building's ridiculous. They can't keep putting up these data centers. From your boots on the ground vision, are we really going to be tapped out? Don't we need these?

[Dave Regnery]

The data center pipeline, this would be before they become orders, is more robust than I've ever seen it before now.

[Jim Cramer]

Right now.

[Dave Regnery]

Right now, as we speak.

[Jim Cramer]

And you're not worried that there's like soft order somewhere over building?

[Dave Regnery]

There is a lot of demand right now and it will be a lot of demand for the foreseeable future. Now I can see forward three years. We'll talk about whether it's five or seven years. But for the foreseeable future, we have a lot of demand right now in that particular vertical.

[Jim Cramer]

Well, I got to tell you, if

Dave Regnery says that that's what's happening.

I'm going with him. Not the doomers.

Who I'm getting tired of. Frankly, I'm getting tired of it.

That's Dave Regneries, the chair and CEO of Trane Technology. What a st. Great to have you on the show.

[Dave Regnery]

Thanks for having me back.

[Jim Cramer]

Everybody back after the break.

[Mad Money Announcer]

Coming up, you've got questions. Kramer's got the answers. Get charged up for a fast fire lightning round next.

[Jim Cramer]

Another crazy day in the market. And this is exactly the kind of

tape we're where discipline matters. That's why we built the CNBC Investing Club to show you how we're thinking through the market in real time, what we're watching and what we're actually doing with our portfolio. You see it before we do. Right now we got something real special and we're going to send you a signed copy of my new book, how to make Money in any Market. Well, because kind of like I have no life at all besides trying to make you money. I spent hours, weekends signing thousands of copies. Maybe you want to give it to your dad for Father's Day. I think he'd like it. Or even new graduate to help them get the right do it right early. I want you to have access to my strategy. So scan the QR code or go to cnbc.com kramerbook come join us. I'm telling you, you're gonna like it.

And now it is time. It's time for the light round because remember, that's where of course, remember me, Sam Stockton said above it by itself just to unclear.

I don't know the stock question at the time.

I stand for versus web episode while you're playing the sound. And then the lightning round is over. Are you ready, Steve? That is over. The lightning round question. Let's start with James in New York. James. Jimmy, chill.

Booyah.

Booyah. Chief, what do you got for me?

[Caller]

All right, first of all, shout out to your wife Lisa for Mother's Day and my new wife Deborah. Okay? And God bless you. And also great interview, interview with Jassy last week too, by the way.

[Jim Cramer]

Wow.

Wow, thank you. Okay.

[Mad Money Announcer]

That's great.

[Caller]

I mean I, I tell everybody like you're the man. Okay.

[Jim Cramer]

Oh, thanks a lot, buddy. Thank you.

[Caller]

So anyway, I got this one here. Okay. I've been checking it out. I have been calling Dylan and stuff and, and also you got a great staff, by the way.

[Jim Cramer]

Oh, my God, yes.

[Caller]

So JP Morgan took it overweight. It's up a hundred 2% in the last month. It's up 300%. That 10% of their business is with Micron Design. And the stock is silicone motion technology.

[Jim Cramer]

That is called Simo, James. And we like Simo. I know the lot. So what you do in these is you buy some and then you wait for a pullback, but you got to put some on. And I think it's a good callback by you. Let's go to Jerry in California. Jerry, Jimmy Kill. Yeah, Shaken here. What's going on? Fun season has arrived. We love to travel, we love to win. Do you have a take on Wynn Resort? Yeah, they got that, you know, they got a problem over there in the Gulf. They got this big deal that they spent a lot of money on. And I gotta hold off for now. I gotta wait to see what happens in the. In that area. Let's go to John in Illinois. Illinois, John. Hello, Jim. Greetings from the Windy City.

You bet.

I'd like to do a show in Chicago. I'm sorry, I'm sorry about that, Jim. Like to know your thoughts on design therapeutics. Pure spec. Pure spec. Understand you can lose everything or you can double on that one. I don't know what you're going to be. That's the problem. Let's go to James in Georgia. James. Hey, Jimbo. I want to give you a thank

you for bringing this company to my attention.

[Rick Werser]

It's a diagnostics company.

[Jim Cramer]

I know they're not doing too good

[Rick Werser]

right now, but this one seems to be different.

[Jim Cramer]

It's billion to one.

We like Billion to one. We looked at it, we thought the name was so silly, you know, like Billion to one. I mean, give me a break. I was talking to Ben Sturdo because. How about billion to one? It's what, like you kidding me? Billionaire? Like I, I have lost money on Billion to one shots at Belmont and a bunch of other tracks. But it's a real company. D company. Very good. I say buy it. And that, ladies, conclusion of the lighting round

[Mad Money Announcer]

coming up with Nvidia CEO Jensen Huang joining President Trump and China. Kramer's zeroing in on the air race between the US And China next. Tomorrow, King. Kick off the trading day with Squawk on the street. Live from post nine at the nyse, Health care insurance.

[Jim Cramer]

Those stocks are soaring. Witness a unh hitting a new high. CPS just breaking out here and that's it. But health care in general, wow. I mean, no, thank you. And that's been to me an opportunity. But wow, I've been wrong calling that opportunity.

[Mad Money Announcer]

It all starts at 9am Eastern.

[Jim Cramer]

You buy Nvidia not for China, not because of the Cerebras ipo, but because it's actually a cheap stock. Cheaper than intel, cheaper than amd, cheaper than Broadcom. Oh, and it's certainly a lot cheaper than Cerebras, even as they're in the same business. That, ladies and gentlemen, is just plain nuts. There would be no AI revolution without Jensen Huang. And Nvidia Company practically invented artificial intelligence as we know it, married it with accelerated computing to give us trillions of dollars worth of gains. Now we're faced with a real test, which is whether the biggest market outside the United States or China will be reopened to them. We keep hearing that it's President Trump who's relenting, allowing the chips to be sold there, which is pretty silly because he landed a long time ago and gave Jensen the right to sell in China. Green light. It's President Xi who's been the obstacle. And I think Xi is facing a real dilemma. He's worried about American hegemony and the tech world, and he won't bet. He just won't help it. He's concerned that China will fall behind in the modern day space race, the race for AI dominance. Right now, our lead is defined by the Feynman. That's Nvidia's next chip after the Vera Rubin, named after legendary Caltech professor Nobel Prize winner Richard Feynman, who dazzled generations with his witness wisdom. Despite what you might hear, our lead is substantial. The current iteration of what we're offering the Chinese is like a hobbled version of the Blackwell. The chips and Nvidia showcased in the 2025 GTC event. That's still a much better chip than what the Chinese have. Xi can let his companies buy that chip. But two things would happen. First, China will be working on an inferior chip, therefore making inferior goods. Second, and more important, he'd be discouraging his own companies from developing a competitive product. He'd be furthering America. Gemini. He'd be forcing China's best engineers to write code on a foreign company's semis. It's a tough choice for everyone, though. There are people in the White House who believe that Jensen is a globalist dirty word, wants free trade with everyone, no matter the cost. I think he simply got the same attitude as any CEO with big export business. They hint that Jensen's greedy because the Chinese market for AI chips is said to be $50 billion and he wants a big piece of the piece of. They worry that these chips could be used against us by the People's Liberation Army. On the other side are people of the White House who think that the best way to handle China is by giving them handicapped Nvidia chips. So their engineers will be dependent upon our technology, knowing that the Chinese military wouldn't dare rely on American chips. PLA doesn't want to give an American company a potential backdoor into all their most advanced technology. Today, the latter camp, the pro Nvidia biz camp, it seemed to prevail as the President brought Jensen Huang with him to China. Beyond that, I do not have more information, but I know this. Our country has a tremendous inferiority complex when it comes to China, even as I think millions of Chinese would like to move here, yet I don't know many Americans clamoring to live in China. There's one thing that we all can agree on. Invaders chips are the best in the world. They're a huge edge. If you can get China hooked on an inferior version, I say have at it. Remember, the big gaining factor for advanced generative intelligence in our country at least, is power. The Chinese don't have a problem with energy because they still build coal plants. They're able to build nuclear power plants without much red tape. Not a lot of enforcement there about the environment. You force them to build their own chips, they will catch up with seemingly unlimited electricity and then they will surpass us. It's a real debate. I think Jensen's on the right side. Maybe his inclusion means the President's riding and then I mean siding with him against the hardliners. If he sides with Jensen, he's backing American leadership and American ingenuity, which is exactly what the hardliners should want. They just don't understand the stakes. I'd like to say this is always bull market. Summer performance is just for you.

Radio Mandy, I'm Drew Kramer.

See you tomorrow.

[Disclaimer Narrator]

All opinions expressed by Jim Cramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC or its parent company or affiliates, and may have been previously disseminated by Kramer on television, radio, Internet or another medium. You should not treat any opinion expressed by Kramer as a specific induce to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money disclaimer, please visit cnbc.com forward/madmoneydisclaimer Trading at Schwab

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