Jim Cramer Says Semiconductor Stocks Are “Going Down.” Buy These 2 Dividend Stocks Instead

This is a positioning washout story more than a fundamentals story. The clearest loser is the crowded, high-multiple AI infrastructure trade: when marginal owners are forced to de-risk, the first leg lower can overshoot intrinsic value by 10-20% before any real earnings revision shows up. NBIS is the purest expression of that dynamic because the valuation leaves little room for financing, execution, or lockup-related supply shocks; the setup argues for continued downside until the leverage purge is visible in volume and borrow.

Semis are likely to trade as a basket before they trade on fundamentals. That means NVDA can remain range-bound even if the underlying demand cycle is intact, with the cleaner entry coming only after breadth stops deteriorating and the tape stops rewarding sellers. The contrarian point: the selloff may be overdone in the strongest franchises, because forced liquidation often compresses multiples faster than forward estimates fall; if NVDA holds prior support and relative strength improves versus SOXX, the bounce can be sharp over 1-3 months.

Defensives are the natural parking place for de-grossing flows, but the market may be paying up for perceived safety too early. CLX has the most credible near-term re-rating if the yield holds and guidance stops being revised lower; KO is safer than COKE because the bottler still has input-cost pass-through friction and less capital return support. PWR is a high-quality cyclical that may stay under pressure near term simply because levered sellers do not discriminate; that creates a better 1-3 month entry than a same-day buy.