Why this unheralded AI stock can go higher despite its rally in 2026

Every weekday, CNBC Investment Club with Jim Cramer hosts a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Wednesday's highlights. 1. Stocks pulled back on Wednesday after a warmer-than-expected inflation report raised concerns the Fed may have less room to cut rates toward the end of this year. The producer price index rose a seasonally adjusted 1.4% in April, well above the consensus forecast for a 0.5% increase. On an annual basis, the index increased by 6%, recording its largest increase since 2022. The report came a day after the Bureau of Labor Statistics reported that the consumer price index rose 3.8% from a year ago. PPI readings pushed Treasury yields higher, with the 10-year yield hovering around 4.45%. Still, the Nasdaq Composite is rising, supported by a rebound in technology stocks. Many semiconductor and AI names rebounded from Tuesday's sharp sell-off, but Jeff Marks, the Club's director of portfolio analysis, warned against chasing names that have gone parabolic. 2. Shares of Club, which owns Nvidia, rose 2% on optimism about CEO Jensen Huang's upcoming trip to China with President Donald Trump. While investors are hopeful the visit could eventually lead to the reopening of chip sales in the region, Jeff said that is not the Club's main focus. "It would be great if something like this existed for Nvidia, but it's not something we're confident in," he said. Instead, Jeff said he's paying more attention to the possibility of a major plane order for Boeing, his other club name. Reports suggest China may order up to 500 aircraft; Jeff said this would be a meaningful catalyst for the aerospace giant. 3. Qnity Electronics, the name of the club, pulled back slightly on Tuesday after rising nearly 10% on a strong hit-and-raise quarter. Jeff called this bearish move "totally acceptable" after the stock's big rally. Qnity's shares have more than doubled this year and remain one of the Club's best performers. Most analysts, including Club, raised their price targets closer to $180 following the earnings. Jeff said Qnity is poorly followed by Wall Street, with only nine analysts currently covering the stock. This dynamic could create further upside as additional companies begin offering insurance coverage. However, he warned that it was "very difficult to follow this upward move", adding that the Club may eventually seek to correct the position as it becomes a larger part of the portfolio. (Jim Cramer's Charitable Trust consists of Boeing, Nvidia, and Qnity. See here for a full list of stocks.) When you subscribe 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 trading alert before buying or selling a stock in his charitable foundation's portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after issuing the trading alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH THE DISCLAIMERS. NO CIVIL OBLIGATIONS OR DUTIES EXIST OR SHALL BE RESULTING FROM YOUR RECEIVING ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULT OR PROFIT GUARANTEE IS MADE.