CNBC’s Jim Cramer on Tuesday shared what he learned from his two days at JPMorgan‘s health-care conference. He marveled at the myriad of uses for generative artificial intelligence in health care, but concluded that Wall Street is more concerned with using that new technology for advertising.
Cramer told investors that “Magnificent Seven” members Amazon and Alphabet saw gains on Tuesday after some analysts lauded the companies’ advertising capabilities and use of generative AI.
“Could targeting the right consumer really be more important than saving the consumer’s life?” Cramer asked. “No, of course not. But investing is rarely about what’s important in a human sense, it’s about making money. And right now, analyzing data more efficiently for targeted ads is worth more than analyzing the data to figure out how to get people to live longer, healthier lives.”
But Cramer said he thinks there is a way to have a fruitful “tech and health care intersection,” referencing a JPMorgan note suggesting that Nvidia’s health-care business is already worth more than $1 billion. The firm’s analysts wrote that the tech giant’s work will be central to expanding “computer-aided drug discovery.”
Cramer praised several pharma companies’ use of generative AI. He said he likes Amgen‘s partnership with Nvidia, using its supercomputers in conjunction with genome data to bolster drug discovery. Roche‘s CEO told Cramer that AI is helping the company speed up and lower the cost of drug development cycles. He added that Cencora uses AI to keep track of inventory, while Medtronic employs it to help doctors during colonoscopies.
However, Cramer suggested that computer science has taken precedence over vital healthcare technology in the minds of many investors.
“Yes, an Abbott Labs pacemaker is an incredible, life-saving, electric technology device,” Cramer said. “But the computer science behind an Amazon or YouTube ad is worth a heck of a lot more when it comes to the stock market, at least for the moment.”
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Disclaimer The CNBC Investing Club Charitable Trust holds shares of Amazon, Alphabet and Nvidia.