'Sometimes the opportunity is too great': Jim Cramer says you 'can't afford not to' own these soaring memory stocks

Cramer says that four memory chip makers are “indispensable” right now: Seagate, Western Digital, Micron and Sandisk.

“Musk is right: Memory has become the bottleneck,” says Cramer, likely referring to Musk’s recent statements on SpaceX’s Q2 earnings call. “And these four companies — well, you know what? It’s pretty good if it stays that way.”

But will it stay that way? And is it worth buying high if there’s a chance these companies’ stocks will climb even higher as new data centers are being built?

Here’s what to know.

Cramer says the memory chip market is usually cyclical — but data centers are changing that, for now

Cramer is first to admit that he’s not early to memory chip stock. That matters, because memory stocks are known to cyclically boom and bust.

Memory chips have huge upfront costs; because of that, once a company starts printing memory chips, it’s generally worth it to keep going until memory prices are very low. This means that memory tends to ping between too much supply and too much demand, and memory manufacturers’ stock prices reflect what part of the cycle memory is currently in.

The question, then, is whether AI has broken that cycle.

Data centers, which require computer memory to work, are being built at unprecedented rates. If combined data center and consumer demand for chips eclipse memory companies’ ability to create memory chips, then memory stock could continue to climb past when it would normally crater.

Still, this can’t last forever. Eventually companies will slow down on data center construction, and memory chip supply will once again eclipse demand. Memory companies’ stock success depends on how long data centers can give them a boost.