During our Investing Club Monthly Meeting last Wednesday, Jim Cramer announced three new additions to the Bullpen: Cloudflare , ServiceNow , and Nextracker . The Bullpen is the Club’s watchlist of stocks being considered as potential portfolio names. Here are the reasons why these highly specialized companies are on our radar. Cloudflare is what’s called a connectivity cloud provider. It’s part content delivery network and part cybersecurity vendor. It manages web traffic for companies’ applications — typically websites but also phone apps. NET YTD mountain Cloudflare YTD The primary goal is reliability — making sure the website is managing traffic smoothly and, above all else, stays accessible. By the nature of its work, there is also a cybersecurity component to Cloudflare because it helps protect websites from bots and automated attacks. You’ve probably seen the Cloudflare verification screen before when visiting a new website. A really simple way to think about the company is a traffic cop for internet traffic. In February, Cloudflare posted a strong quarter with better-than-expected revenues, earnings per share (EPS), and free cash flow. Management’s guidance was solid as well, with sales and EPS above expectations. CEO Matt Prince appeared on “Mad Money” to talk about the quarter . ServiceNow is a cloud computing platform that helps enterprises manage their digital workflows. Jim said he’s drawn to ServiceNow because of its large presence at Nvidia ‘s GTC conference last month. NOW YTD mountain ServiceNow YTD “They have become the great facilitator of much of the non-client facing AI at the enterprise and the government. Consider them the productivity enhancers at each client, playing the role that I once thought Accenture would play. They integrate between the AI platform and the productivity product” Cramer explained during last week’s meeting. Indeed, ServiceNow has one of the clearest paths to monetizing AI among enterprise software companies. Through its Now Assist product, users can leverage generative AI to increase productivity and work smarter. A few use cases of NOW Assist include summarization, conversational exchanges, content creation, and code and flow generation. Nextracker could be a potential high-growth name. The maker of solar tracker systems allows huge utility-scale rows of solar panels to rotate and follow the sun’s movement across the sky, maximizing their power generation. Their original innovation was a single-row tracker technology that allows each row of panels to move independently, rather than all in unison. NXT YTD mountain Nextracker YTD Previously this technology was considered too expensive, but Nextracker has been able to lower its costs to the point where it’s now much more competitive. Over the years, Nextracker has added additional features including self-powering systems, technologies that help improve the energy yield on uneven terrain or in bad weather conditions, and equipment that protects solar panels during hailstorms. Nextracker is the global market share leader in this industry. Two-thirds of the company’s revenue comes from the U.S., where it effectively has a duopoly with Array Technologies . The two companies collectively have more than 80% market share. Revenue at Nextracker should get a boost from spending authorized by the federal government’s Inflation Reduction Act, which included domestic manufacturing credits for these kinds of solar trackers. According to Goldman Sachs, these credits could boost Nextracker’s EPS by 20% to 50% in its 2025 fiscal year. CEO Dan Shugar appeared on “Mad Money” last month. Nextracker was downgraded to a hold-equivalent equal weight with a price target of $63 per share at Barclays on Tuesday morning. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
