Jim Cramer examines why the “Magnificent Seven” technology stocks are so volatile in the market

CNBC’s Jim Cramer told investors on Wednesday that it can be difficult to own high-quality stocks, such as the “Magnificent Seven” technology stocks. He details why these companies are “among the most widely traded companies in the space,” but also why he believes they shouldn’t be.

“It wasn’t easy to hold on to the Great Seven,” Kramer said. “You had to fight a lot of trends, a lot of obvious pain points, and a lot of outright naysayers. Remember, as obvious as these winners seemed in the past, it was very easy to get rid of them.”

• Alphabet: Alphabet, Google’s parent company, has been a tough stock for several reasons, including two antitrust lawsuits brought by the Department of Justice and artificial intelligence competition from Microsoft, Cramer said. But he emphasized the company’s excellence in YouTube and its search business, adding that investors shouldn’t be too alarmed about the shortfall in cloud revenue reported last quarter.
• Amazon: Amazon is also facing pressure from antitrust litigation, and there are concerns about eroding market share for the company’s web services division, Cramer said. But he praised the company’s fourth quarter and cost-saving measures, saying concerns about inflation and the bond market had pushed its shares lower.
• Apple: According to Cramer, Apple has received cuts from some on Wall Street due to declining hardware sales as well as difficult business in China. However, he said he appreciates the company’s customer satisfaction levels and growing number of users in developing countries.
• Meta: Cramer said many have concerns about slowing Meta ad sales due to the conflict in the Middle East. But for him, this is a temporary problem, and he praised the company’s products such as Instagram and WhatsApp.
• Microsoft: Microsoft shares fell when it announced upfront expenses for artificial intelligence without showing material revenue, according to Cramer. But he said the company has shown it can now monetize AI investments.
• Nvidia: Cramer said concerns about a U.S. ban on technology chip sales to China may have prompted some investors to leave China. But he stressed his firm belief that NVIDIA will remain valuable because of its prominent role in making the chips necessary for artificial intelligence.
• Tesla: Cramer acknowledged that Tesla recently reported a weak quarter. However, he said the company remains valuable because of CEO Elon Musk, calling the stock a “cult of personality.”

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Disclaimer The CNBC Investing Club Charitable Trust owns shares of Alphabet, Amazon, Meta, Microsoft, and Nvidia.