Jim Cramer’s 3 Reasons Profitable Tech Stocks Are Taking a Hit

Jim Cramer’s 3 Reasons Profitable Tech Stocks Are Taking a Hit

CNBC̵[ads1]7;s Jim Cramer offered three reasons Monday why tech firms, including companies with strong balance sheets, are experiencing stock market pain.

The “Mad Money” host, who films the show from San Francisco this week, repeated his warning against unprofitable companies from earlier this year, but acknowledged that even firms with strong finances have felt the heat.

He gave three reasons why this might be the case:

  1. The strong US dollar and the energy crisis in Europe are making companies more frugal with their purchases. “The underlying companies make products that their customers can live without in an increasingly tough global economy,” Cramer said.
  2. The Federal Reserve might want stocks down. The central bank needs inflation to come down by any means necessary, which means the market could turn uglier, Cramer said.
  3. The company’s individual performances could have been lacking. “I happen to think Adobe is a wonderful company, but the business has gone down,” he said.

Cramer added that the jury is still out on whether the technology will remain crushed, or whether this is an opportunity to buy the dip.

“However, has the selloff gone too far, or is this simply a rolling nightmare that’s not going to end anytime soon? I mean, that’s the question,” he said.

Jim Cramer gives his take on the state of tech stocks

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