Jim Cramer cautioned investors on Thursday against excessive speculation in quantum computing and nuclear power stocks, despite growing market enthusiasm for both sectors.
What Happened: “Both have promise, someday, but that day is not near enough to justify the current valuations for these stocks,” CNBC’s Cramer said during his show, pointing to concerns about long development timelines and current market valuations.
His warning comes as the U.S. quantum computing market, valued at $138.2 million in 2022, is projected to reach $1.2 billion by 2030, according to Fortune Business Insights.
Several quantum-focused stocks have seen significant recent gains, including Rigetti Computing Inc. RGTI, D-Wave Quantum Inc. QBTS, and Quantum Computing Inc. QUBT.
Cramer expressed particular concern about quantum computing companies that are currently unprofitable despite substantial stock price increases. He referenced Alphabet Inc.’s GOOGL GOOG recent quantum developments, including its new Willow chip, while noting the technology remains “in its infancy.”
Why It Matters: Regarding nuclear power, Cramer cited GE Vernova CEO Scott Strazik‘s projection that nuclear projects could take a decade to generate profits. He questioned the valuations of smaller nuclear companies like Oklo and NuScale Power Corp. SMR, despite acknowledging the sector’s long-term potential.
Major tech companies including Microsoft Corp. MSFT and Amazon.com Inc. AMZN have made significant investments in quantum computing development, with Amazon also exploring nuclear energy applications.
“I fear people will get hurt speculating on even the biggest companies, let alone the smaller ones,” Cramer said.
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