Jim Cramer Says Nvidia, Eli Lilly, Novo Nordisk Are Not Overvalued: 'Will Be Ready To Buy If This Market Sells Off'

CNBC host Jim Cramer advised investors to gear up for a potential market sell-off, asserting that they should be ready to make purchases if undervalued stocks dip.

What Happened: Cramer, in his show “Mad Money,” dismissed the notion of sector bubbles and encouraged investors to be prepared to buy if the market experiences a pullback, reported CNBC on Monday. He mentioned the increasing artificial intelligence (AI) sector and the possible overvaluation of some AI stocks but emphasized that this does not preclude further growth.

"I will be ready to buy if this market sells off," he said.

"Just raise some cash and be ready to do some buying if and when the market has its inevitable pullback after this incredible run."

Cramer cited Nvidia NVDA as an example, indicating that the company’s market cap of over $2 trillion is not excessive, and it has consistently surpassed earnings estimates. Cramer also endorsed the high valuations of drug companies like Eli Lilly LLY and Novo Nordisk NVO, which produce GLP-1 medications for diabetes and obesity treatment.

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Cramer suggested that the upcoming labor report could potentially trigger a buying opportunity, predicting stronger figures than expected by Wall Street.

Why It Matters: Cramer’s advice comes amid significant developments in the tech and pharmaceutical industries. Nvidia’s CEO, Jensen Huang, recently suggested that artificial general intelligence (AGI) could become a reality within the next five years, depending on how its achievement is defined. With Nvidia at the forefront of producing AI chips, Huang’s insights carry significant weight in the tech industry.

Meanwhile, the race for new drugs to fight obesity and related diseases has been heating up, with companies like Eli Lilly and Novo Nordisk facing new competitors. Positive results from trials by Zealand Pharma have led to a surge in the Danish company’s shares, adding to the intense competition in the weight-loss drug market.

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