An analyst just upgraded a cybersecurity stock that we've been pounding the table on
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CNBC
27 minutes ago
- CNBC
5 stocks to buy as the S&P 500 nears record highs, plus updates on 26 other names
Jim Cramer covered each holding in the Investing Club's portfolio during the August Monthly Meeting on Thursday. He went over five stocks new investors should consider buying — and when to sell others – as the S & P 500 trades near record highs. Apple: This stock has had a big rally following the company's announcement last week of an additional $100 billion investment in U.S. manufacturing. It just goes to show: Don't give up on Apple. The next major test will come if a U.S. judge in Alphabet's antitrust case ends its search exclusivity deal with the iPhone maker. If that happens, Apple management will have to come up with a plan to offset the $20 billion worth of annual payments from Alphabet. We remain confident and maintain our "hold, don't trade" thesis on the stock. Amazon: The company's cloud computing division, Amazon Web Services, isn't growing as fast as hoped. That was seen in second-quarter earnings late last month. Still, we're staying long on the stock. AWS is a huge business, and demand for cloud infrastructure is incredibly high. Abbott Laboratories: We've been selling down the position on the belief that Abbott just doesn't have the same oomph that it used to. Its recent earnings report suggested the headwinds in China could be more prolonged than previously thought. Jim said if it fell much further, we'd consider rebuilding the position. Broadcom: This company is one of the linchpins of the AI trade thanks to its custom chips and networking equipment. The scale of the AI buildout is so immense that, despite all the negatives, we just have to plow through and the stay the course. We did trim our Broadcom position for a big gain on Aug. 6, to not be greedy. BlackRock: The financial stock is well positioned for more upside as the broader equities market continues to trade near record highs. That's because BlackRock shares typically work best in a portfolio when assets are growing from appreciation and contributions. Bristol Myers Squibb: Could the rise in M & A activity and a more hands-off approach from antitrust regulators put Bristol Myers in play? Jim says it's possible, though not certain. A forthcoming trial on its new schizophrenia drug Cobenfy could help quell some concerns about its commercial potential that arose after prior results fell short of investor expectations. Capital One: If the U.S. economy goes south, Capital One could get hit because it's heavily levered to the health of the consumer. So far, however, there are no serious warning signs that could impact credit quality. Additionally, we continue to celebrate Capital One's recently-completed blockbuster acquisition of Discover Financial. Costco: This is a great stock to own during macroeconomic uncertainty, as the wholesale retailer attracts value-conscious customers. "When times get tough, people go to Costco," Jim said. Investors should consider buying more. Salesforce: The idea that "AI is eating software" has won over Wall Street, and the argument has its merits, as we explored earlier this week . We accordingly downgraded our rating on Salesforce. But we're not ready to bail altogether. We want to see the latest revenue contributions from Agentforce in its upcoming earnings report, and its big annual Dreamforce conference this fall has historically been a positive catalyst. CrowdStrike: Investors should consider buying CrowdStrike as shares tumble due to a broad slump in the cybersecurity sector. The stock's move lower, however, has nothing to do with the company's fundamentals. That's why it's a solid time to capitalize on the dip. Cisco Systems: This is our newest addition to the Club's portfolio, which we initiated on July 17. The computer networking equipment powerhouse has a big opportunity to benefit from AI. Plus, the firm has a strong track record of returning capital to shareholders. Cisco posted a top and bottom line beat Wednesday evening. The company, however, missed revenue estimates for its security segment, which sent shares lower. It didn't change our thesis on the stock though. Coterra Energy: This stock has become a cruise to nowhere, and we opted to exit the rest of our small remaining position. It's a tough market for the underlying commodities that Coterra depends on for revenue, and operational issues caught us by surprise too. DuPont: Shares are in a lull ahead of DuPont's forthcoming breakup, experiencing what many on Wall Street call "spin purgatory." Although we don't know with certainty when the stock will pick up again, it will happen in a span of days, rather than weeks or months. That means investors should buy DuPont stock again anytime it dips lower ahead of the split. Danaher: We're holding this lagging stock as we await more clarity on potential catalysts. The company could spring back to life if an IPO window opens for biotech, which could boost orders for Danaher. That being said, Danaher's increased focus on life sciences has made the firm lose some of its optionality. Disney: New to the Club? Disney is one to buy. Theme parks are strong, movies are very good and streaming is fine. Nothing is great enough to lift the stock to the $130s. But it most certainly belongs in the $120s. Dover: It's been a lackluster 2025 for Dover, with shares down 4.5% year to date. But more aggressive portfolio management could be a way to improve investor sentiment. By divesting one of its far-flung businesses, management could unlock more value. Eaton: This stock's performance has been nowhere near impressive as of late, but members should stick with Eaton. The industrial conglomerate has decent exposure to secular growth themes with its aerospace and data center businesses. Jim, however, wishes management would split the company in two because it's more difficult for them to create value together. GE Vernova: This power equipment maker has a huge growth opportunity as the data center build out continues to raise demand for offerings like gas turbines. "Here's a stock that almost seems to be invented for this moment," Jim said of GE Vernova. He isn't happy, however, that management has been resistant to adding production capacity for its turbines. Goldman Sachs: This might be "one of the cheapest stocks" the Club owns, Jim said. That's because shares will be worth much more as Wall Street dealmaking picks up. More IPOs and M & A deals can lead to an upside to revenue for Goldman's highly lucrative investment banking business. Home Depot: With rates still high, this retailer has had a lackluster stock performance. That being said, Home Depot is the ideal stock to own during an interest-rate-cutting cycle. Lower borrowing costs should cause a much-needed rebound in the housing market, which means more business for Home Depot. Honeywell International: Yet again, Jim pounded the table on Honeywell's spinoff into three public companies. "The three pieces could be worth dramatically more than the stock is selling for," he said. "My conviction is very high for this." Let's hope it helps its share price, too. Honeywell stock has underperformed the market in 2025, down nearly 3% year to date versus the S & P 500's 9.7% gain. Linde: Jim described Linde as the "perfect industrial." The company continues to thrive in various macro backdrops, as seen in its many consecutive beat-and-raise quarters. Plus, Linde's immense pricing power makes us love the stock even more. Eli Lilly: We double upgraded Lilly on Wednesday after a great sign of confidence from management and the board of directors in buying up a bunch of stock in the open market. While it's usually not our style to adjust the rating so soon after we downgraded it, when the facts change, we must change with them. Meta Platforms: Buy this stock on its next dip. Meta shares could run higher if management effectively monetizes WhatsApp. The social media behemoth has made recent strides to turn WhatsApp into a moneymaker by rolling out advertisements back in June. Meta clearly has the toolbox to make another great ads business. Just look at the reach of the company's platforms like Instagram and Facebook. Microsoft: We recommend members buy shares on any weakness. The firm had a picture perfect quarterly earning report in late July, fueled by accelerated revenue growth in its cloud computing business. This put to bed any question of Microsoft's leadership in generative AI. Nvidia: The company reports on Aug. 27, and this quarter at least will hinge on how well they're meeting demand for Blackwell chips rather than its China business. As with Broadcom, the size of the AI buildout and the money that will flow to Nvidia makes the stock a must-own. Palo Alto Networks: Shares have been weighed down by weakness in cyber, along with concerns about management's intent to acquire CyberArk. The market's reaction is overblown though. "I feel very good about this situation," Jim said of Palo Alto. Starbucks: This is Jim's favorite consumer-facing stock we own right now. Patience is required on the turnaround, led by CEO Brian Niccol, because when things really get better, it will be too late to buy. TJX Companies: There's nothing to do with TJX ahead of earnings next week. After a two-month downtrend, the stock has climbed back up into the low-to-mid $130s. We were right to stay the course despite those worrying about a technical breakdown. Texas Roadhouse: Investors should "buy this one aggressively," Jim said. Although elevated beef prices weighed on profitability in the second quarter, the restaurant chain has great revenue growth and has executed well on what it can control. Plus, there's no telling when we'll see Texas Roadhouse stock this low again following its earnings-induced selloff last week. Wells Fargo: This bank stock is undervalued. Jim said he'd buy some now if the portfolio didn't own any. He forecasted that shares could rally past its record highs, and still not be too expensive. Plus, Wells has a decent chance to grab more M & A deals moving forward now that its $1.95 trillion asset cap has been removed. (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.
CNBC
27 minutes ago
- CNBC
Tiger cub hedge fund Coatue Management unveils new position in Oracle, doubles down on AI buildout
Philippe Laffont's Coatue Management unveiled a new position in Oracle, and doubled down on key artificial intelligence beneficiaries Nvidia and Microsoft, as the tech rally came back with a fury in the second quarter. Fund founder Laffont — known as one of the "Tiger Cub" fund managers that worked under the late investor Julian Robertson — disclosed a stake in enterprise software company Oracle that amounts to a more than $843.3 million holding for the three months ending June, according to the firm's latest regulatory filing. Oracle outperformed in the second quarter, surging more than 56% on the strength of its cloud infrastructure business helping clients operate artificial intelligence models. The stock is up more than 11% this quarter, thus far. Laffont also doubled down on certain members of the Magnificent Seven names, adding 34% to his Nvidia holding. The chip company was the first public company to reach a $4 trillion valuation as investors continued to be on the AI buildout; it rose more than 45% in the second quarter alone. He also added to Microsoft, increasing his holdings by 20%. The investor continued to bet on the AI buildout, starting a $749.4 million position in Arm Holdings, a British semiconductor and software design company. He has a new allocation in Marvell Technology amounting to $602.4 million. Laffont expanded his allocations to a smattering of other chip names, including Broadcom, which is a top 10 holding, and Lam Research. The investor continued to sell down his shares in key China tech companies . He reduced his stake in Alibaba, for example, by 77%. — CNBC's Yun Li contributed to this report.
Yahoo
an hour ago
- Yahoo
Stock market gets 'kick in the pants' from startling inflation report
Stock market gets 'kick in the pants' from startling inflation report originally appeared on TheStreet. Stocks have rallied significantly, partly on the argument that the impact of the Trump administration's tariffs on inflation will be smaller than was feared earlier this year. However, the July Producer Price Index, which measures wholesale goods prices, has called that thinking into question. While consumer-level inflation, as measured by the Consumer Price Index and Personal Consumption Expenditures Index, has ticked only marginally higher, PPI inflation soared in July far more than economists expected. Pricing pressure at factory gates is often viewed as a precursor to consumer inflation, suggesting that CPI and PCE data could worsen in the next month or two. If so, it wouldn't be great news for stocks, which perform best when households and businesses feel flush rather than cash-strapped. Price increases may spell bad news for stocks The Federal Reserve doesn't directly control how much your bank will charge you for a credit card, mortgage or auto loans, or whether stocks go up or down. However, the Federal Funds Rate determines how much banks charge each other when they lend reserves overnight. So, changes (and expected changes) to Fed interest rates, and the resulting impact on the prime rate and Treasury yields, influence how much shoppers and businesses pay in interest and have left over to affects economic activity, which in turn affects corporate revenue and earnings growth, which are the lifeblood of higher stock prices. As a result, investors closely watch the Fed's monetary policy. The central bank decides its monetary policy based on economic data, specifically data on jobs and prices, which enable it to balance its dual mandate to foster low unemployment and inflation. So far, the data have led the Fed to sit on its hands in 2025, leaving rates unchanged because of concern that the tariffs would cause inflation to spike. But investors have increasingly modeled for eventual rate cuts, hoping trade negotiations would lower effective tariffs by more than expected this spring, thus supporting stock prices and, eventually, lower rates. Those hopes strengthened following recent weak jobs data, leading most to predict that the Fed will lower rates in September, driving higher GDP, sales and earnings. Unfortunately, the July PPI report may have tossed a monkey wrench into that optimism. According to the Bureau of Labor Statistics, which produces the inflation report, PPI increased 0.9% in July, the most significant jump since June 2022. Economists expected a 0.2% increase. Overall, headline PPI inflation rose 3.3% in July year-over-year. The index for final demand minus volatile foods, energy, and trade services was up 2.8% in the past year, "increasing 0.6% in July, the largest increase since rising 0.9% in March 2022," according to the BLS's statement. More Economic Analysis: Trump sends strong message on Federal Reserve Chair decision A divided Federal Reserve mulls interest rate cut after wild week Federal Reserve reveals latest interest rate cut decision "July PPI explodes to the upside leaving Powell in a bind and expected rate cuts in question," wrote longtime Wall Street analyst Stephen Guilfoyle in a TheStreet Pro post. "In what can only be termed as a kick in the pants for anyone hoping for (or betting on) a series of aggressive rate cuts to kick off with the Sept. 17 Federal Open Market Committee policy decision, this was a rude awakening." What PPI means for the stock market and the Fed The average annual return for the S&P 500 since the 1950s is about 10%, yet the benchmark index has rallied 28% since April 9's reciprocal tariff pause. The gains have been unrelenting, locking many investors out of the market. As a result, the S&P 500's valuation has arguably become stretched and may be pricing stocks for S&P 500's price-to-earnings multiple, a key valuation measure investors use to determine whether stocks are cheap or pricey, has climbed above 22. That's flirting with levels last seen near the highs in February before stocks fell sharply on tariff announcements. Historically, high p/e multiples haven't translated into significant gains one year later, suggesting that earnings will have to grow faster than prices if stocks are to continue moving up. Any delay to rate cuts that could fuel GDP and profit growth would be unwelcome. "July producer prices simply exploded to the upside. There's no way to sugarcoat this," said Guilfoyle. "Unless this is reversed or revised in a more frigid direction with the early September release of the August data, the Fed has all the ammo it needs to be more cautious, and Fed Chair Jerome Powell looks a lot less foolish than I thought he had." Currently, the CME's FedWatch tool, which tracks rate-cut probabilities based on the futures markets, still shows a likely cut in September and October. However, the chances for a third cut in 2025 fell dramatically. "That third rate cut of a quarter point that had been priced in for December ahead of this release has now been pushed out to April. That's a big deal," said market gets 'kick in the pants' from startling inflation report first appeared on TheStreet on Aug 14, 2025 This story was originally reported by TheStreet on Aug 14, 2025, where it first appeared.
