The US stock market has been struggling this week, after President Donald Trump confirmed tariffs against Canada and Mexico.
Trump proposed a 25% tax on both countries to begin February.
The negotiations, which were supposed to be delayed by a month to allow for a discussion and possible solution to a more permanent problem at the time have failed. The tariffs will now go into effect on March 4, despite the fact that the allies secured a one-month extension.
The US President confirmed in a recent post on Truth Social, that China will also face an additional 10% tariff starting next week.
Cramer says cybersecurity is immune from Trump tariffs
The US tech stocks are most at risk of new tariffs under Trump’s administration, and this is why they have been the main cause of the recent weakness in the S&P 500 index.
Why? They rely heavily on Beijing as a part of their supply chain.
Jim Cramer, the famous investor, believes that cybersecurity software is immune to Trump tariffs.
The former hedge fund manager, who appeared on “Mad Money” last night, referred to cybersecurity stocks as the best picks for the current macro-environment as they are not exposed to tariffs.
Crowdstrike Holdings Inc. (NASDAQ: CRWD) is a name that he recommends as a particular investment within this space.
Why is Cramer bullish about Crowdstrike?
Jim Cramer is still bullish on cybersecurity stocks, despite rising tariffs. He also believes that online threat protection is a necessity of the hour.
He was surprised by Crowdstrike’s recent annual report, which “talked about North Koreans entering companies, posing like employees, and stealing data.”
According to Mad Money, in the face of such a large threat, he is convinced that the demand for cybersecurity products, like those offered by CRWD, could grow exponentially over time.
“Cyber” is the only area where they cannot tax because there is nothing to tax. He said this on CNBC’s Squawk on the Street.
Crowdstrike continues attracting strong demand
Independent firm named the Austin-based company as a leader in managed detection.
Cramer is bullish about CRWD shares because of its strong financials. In November, Nasdaq-listed firm cited strong demand when it raised its forecasts for the entire year.
Crowdstrike’s revenue is now between $3.92 and $3.93 Billion, thanks to “incredible success” with its customer commitment packages.
Wall Street seems to be in agreement with Jim Cramer’s view on CRWD.
The consensus rating for the cybersecurity technology company is currently “overweight”, with a potential upside of $412 on average, which indicates a potential gain of about 8.0% from current levels.
This post Cramer reveals that a subsector of technology can withstand Trump tariffs could be modified as the updates unfold.
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