Jim Cramer says Wall Street is punishing the wrong tech stocks

Jim Cramer argued that Fortinet’s underwhelming results and market-share losses reflect company-specific weakness, not a cybersecurity demand slowdown, and said Palo Alto Networks and CrowdStrike shares should be bought. He also said ServiceNow’s slight earnings disappointment pressured Workday and Salesforce, and Alphabet’s results weighed on Microsoft despite its strong quarter; Samsung’s conservative outlook pressured Micron despite what Cramer described as stronger high-bandwidth-memory demand. On Thursday, the Dow and S&P 500 each fell 0.4% and the Nasdaq dropped 1.4% as investors digested earnings.

Analysis

The useful signal is potential dispersion, not a blanket “buy the dip” in software. However, Cramer’s endorsement is not independent confirmation: his trust holds several of the named beneficiaries, so treat the commentary as a source of trade hypotheses, not evidence that demand or market share is improving.

For cybersecurity, a long PANW/CRWD versus short FTNT is plausible only if subsequent disclosures confirm that Fortinet’s weakness is company-specific and the broader platforms retain demand and execution. Product breadth alone does not establish superior growth, margins, or valuation. The trade can still lose if customer spending is slowing across security or if the leaders’ premium multiples compress with the technology sector.

Enterprise software deserves more caution. NOW weakness may be an idiosyncratic read-through, but WDAY and CRM share exposure to software budgets, procurement delays, and duration-sensitive multiples; sympathy selling is not automatically mispricing. Likewise, MSFT’s relative results versus GOOG and MU’s HBM exposure versus Samsung’s outlook are distinct earnings drivers, not clean industry-level comparisons.

Near term (days), post-earnings positioning and broad risk appetite can dominate fundamentals. Over 1–3 months, compare forward guidance, bookings/backlog, and share trends before adding exposure. Over 6–18 months, platform consolidation could favor broader security suites, while AI and memory supply/demand could change relative winners. No trade is justified solely by one peer’s report.

Key Decisions for Investors

• Watch for a PANW/CRWD-versus-FTNT pair after post-earnings price action stabilizes; initiate only if forward demand or share indicators support divergence. Reassess or exit if PANW/CRWD guidance weakens alongside FTNT, or FTNT shows stabilization that undermines the share-loss thesis.
• Do not automatically buy WDAY or CRM on sympathy declines. Verify company-specific guidance, bookings and customer-spending commentary; broad-based softness across those metrics would falsify the contagion-only interpretation.
• Treat MU as a conditional HBM exposure, not a read-through from Samsung alone. Track MU guidance and customer/supply indicators; weakening HBM demand or supply additions that impair pricing would invalidate the relative thesis.
• For MSFT versus GOOG, require forward cloud and AI monetization evidence before expressing relative value. A broad technology multiple contraction can overwhelm one quarter’s reported execution.