Jim Cramer said Wednesday night that he was saddened by a news report that indicated Nvidia's board of directors is preparing to fire CEO and co-founder Jensen Huang amid a widening extramarital affair scandal. "Look, a Jensen-less Nvidia is an Nvidia many will not want to own," Jim said on "Mad Money," as not one but two bombshell articles were hitting the tape and the stock started sinking in after-hours trading. "I've always said, 'own it, don't trade it.' Well, I didn't think [anything like] this would happen. I don't know anyone who did. It's very sobering." After the show, Jim indicated that he doesn't want to buy any more shares of Nvidia into the scandal-driven sell-off, particularly with an earnings report looming next week, but he expressed a belief that the company can still succeed over the long term even if it is without Huang at the helm. Shares of Nvidia fell 8% in extended trading Wednesday after The Wall Street Journal reported that the chipmaker's board was preparing to oust Huang, with plans to meet as soon as…
Cramer's stance on Nvidia's stock amid reports that CEO Jensen Huang may be ousted
In short
Nvidia shares plummeted 8% in extended trading Wednesday after reports emerged that the board is preparing to oust CEO Jensen Huang over multiple extramarital affair allegations. An investigation led by the law firm Wachtell, Lipton, Rosen & Katz is probing relationships involving an internal vice president and a Megaspeed executive suspected by U.S. intelligence of being a Chinese spy. Jim Cramer announced he will not buy the dip, pointing to leadership talent like CUDA creator Ian Buck as viable succession options. Due to the mounting executive uncertainty, the CNBC Investing Club downgraded Nvidia to a hold-equivalent rating.
Key points
- Jim Cramer is avoiding buying Nvidia shares during the current sell-off but will not liqu…: Jim Cramer is avoiding buying Nvidia shares during the current sell-off but will not liquidate his existing position.
- Cramer highlighted internal candidates such as CUDA creator Ian Buck as evidence Nvidia c…: Cramer highlighted internal candidates such as CUDA creator Ian Buck as evidence Nvidia can survive without Huang.
- The CNBC Investing Club plans to buy rival Advanced Micro Devices once restrictions lift…: The CNBC Investing Club plans to buy rival Advanced Micro Devices once restrictions lift while exiting its Intel position.