December 20, 2024
December Monthly Meeting 2024 Rapid-fire update on 35 stocks
Here’s a rapid-fire update on all the 35 holdings in Jim Cramer’s Charitable Trust, the portfolio we use for the CNBC Investing Club. During the December Monthly Meeting on Thursday, Jim looked at each company’s prospects for 2025. Apple : 2025 will be the year investors realize Apple is more than a maker of iPhones and other hardware; it also boasts a growing services business that generates recurring revenue through subscriptions. Jim reiterated Apple’s status as one of 12 core holdings in the portfolio. This means that the stock has excellent fundamentals moving into 2025, and we’d prefer not selling any shares because of its long-term value. Abbott Laboratories : A key overhang for this stock should disappear next year as litigation over the company’s special infant formula continues to get settled. “The stock’s taken a real drubbing but the business just keeps getting better and better, ” Jim said, adding that Abbott could a comeback in the beaten up healthcare sector. Advanced Micro Devices : Investors like us are wondering: Is there room for AMD in the increasingly saturated AI chip space in 2025? Nvidia is the clear winner so far, with Broadcom and Amazon grabbing other viable business. So far, AMD has failed to come up with a killer chip. We’re considering offloading more shares even after our sale earlier this week. Amazon : Another core holding, Amazon should do amazing things in 2025. Jim predicted its e-commerce business will grab more share from brick-and-mortar chains like CVS and Walgreens because of the seamless transaction process for the consumers. “But the big story will be in international where the earnings breakout will be so stellar that it could justify a lot of this run,” he added. Broadcom : Hundreds of billions of dollars will pour into data center construction in 2025, Jim said, citing the recent rallies in Broadcom and peer Marvell as proof. “Broadcom is integral to the piping and the knowledge factory that is the data center,” Jim said, adding that it’s all coming together for Broadcom going into 2025 — including its legacy businesses for PCs and cellphones which still make up 60% of its semiconductor business. Best Buy : We’ve said that AI PCs should boost Best Buy sales as more people come into the store to upgrade their devices. We’ve also said lower interest rates would spur more housing market activity and drive demand for appliances. Unfortunately, both have been a bust so far, and we’re not sure what 2025 has in store. BlackRock : The world’s biggest asset manager flatlined recently, but we’re not concerned. If anything, we see it as a buying opportunity. That’s because BlackRock has big things on the horizon for 2025. A series of recent acquisitions, for example, will give the firm more exposure to the very lucrative infrastructure space. Bristol-Meyers Squibb: We remain upbeat as ever on Bristol-Meyer’s new schizophrenia drug Cobenfy, which should post “staggering growth” because it is the first novel treatment for the disease in more than 30 years. “This drug of Bristol’s [is] a miracle drug and we intend to ride it the same way we did and do [with] Eli Lilly,” Jim said. Costco : Jim said the retailer’s valuation, at 55 times earnings, can’t be justified by conventional means. But the runway for this company is longer than any other stock in the portfolio, as demand for more Costco stores remains incredibly high. “They could use, I don’t know, triple the number of Costco’s there are right now around the globe. Maybe more,” he added. Salesforce : The enterprise software company is out front with Agentforce, the company’s suite of AI assistants. “This is the agentics economy and Salesforce intends to lead it,” Jim said. He added that demand for these offerings are high, citing Salesforce’s hiring spree for its AI sales . CrowdStrike : The Club added to our position in the cybersecurity stock Thursday because 2025 will be a comeback year for the stock. Management’s been on an apology tour since July after a software update caused a massive outage that rocked IT systems across the globe. Once the firm regains customers’ trust, we want to see CrowdStrike on the offense again with an increase of sales. Coterra Energy: There’s some uncertainty around this energy stock. Jim said President Joe Biden’s pause on approvals for certain U.S. liquid natural gas exports will weigh on exposed companies like Coterra. On the other hand, President-elect Donald Trump has said his administration will immediately end the moratorium in January. The Club is sticking with the stock. We like to own at least one energy name at all times in case commodity prices spike. DuPont : We’re considering another purchase of DuPont as shares are unfairly punished with the rest of the materials sector. It may be the perfect opportunity to get in before the conglomerate officially splits into three publicly traded companies next year, which should mean a boost for its stock price. Danaher : A pickup in the IPO market picks in 2025 should be good news for Danaher because one of the first things biotech companies do when they go public is place large orders with the life sciences company. Danaher provides materials and tools that drug companies use to make and study medications. This tailwind may offset Danaher’s China risk, too. Disney : The entertainment company’s turnaround story will continue into 2025. Investors will realize that Disney’s linear properties like ABC and ESPN are no longer a negative for the overall business. Jim also noted that a new CEO is expected to take over for Robert Iger. “It could be a very good time to own this stock,” Jim said. Dover : This industrial name should begin introducing cryogenic technology into its offerings, which would help solve major issues with data center facilities such as overheating. Demand for Dover’s offerings would soar because it would be one of few that can provide this tech at scale. Eaton : New management has helped this core holding reinvent itself, making it levered to growing end markets like electrical products, aerospace and all kinds of vehicles. Think of the huge boom in data center construction in 2025: Eaton sells products needed for the facilities so they can handle AI workloads. GE Healthcare : The Club won’t be rebuilding this healthcare position. We’re concerned about the stock into 2025 because, in part, sales in China haven’t improved. “My original desire was to find a company that once it was spun off would be laser-focused on its niche and while that may be the case, it hasn’t happened,” Jim said. “And others must feel similarly because they fled it like rats fleeing a sinking ship.” Alphabet : Jim said that the incoming Trump administration’s seemingly more lenient stance on antitrust rules will be the “end of the existential question of Alphabet’s survival.” The company has faced ongoing scrutiny from the U.S. Department of Justice antitrust head Jonathan Kanter, who said Tuesday that he will be stepping down from his role. Jim also touted the Google parent’s recently announced quantum computing chip as a plus. Goldman Sachs: The Club started a new position in this financial name Thursday, while selling a significant portion of our stake in another. Our focus is on Goldman’s investment banking business. Wall Street dealmaking should pick up next year as the Federal Reserve continues to lower interest rates. Home Depot : We bought more of this home improvement name Thursday on its recent dip. As borrowing costs continue to go down, housing turnover should pick up and send more DIY customers to Home Depot, also a core holding. Honeywell : This industrial conglomerate may finally give us what we want: a spin-off of its aerospace business and its automation unit. It would be safe to expect this in 2025 after activist hedge fund Elliott Investment Management initiated a huge position in the firm last month. Linde : Jim said that once the economy picks up again, potentially as interest rates go lower in 2025 and volumes increase, he expects Linde earnings growth to explode. In fact, that’s why we added to our position Wednesday on the stock’s recent weakness. Eli Lilly : The drugmaker is becoming “the Nvidia of pharma,” referencing the company’s dominance in the weight loss drug market, according to Jim. Eli Lilly makes popular GLP-1 Mounjaro and Zepbound. “Yet when I hear about rival products I think about two things: One, Lilly is working on everything that I hear they are and they are doing it better,” he added. “And two, Lilly has the physical capacity no one else has.” Meta Platforms : In 2025, Jim said the Instagram and Facebook parent will grab even more revenue share in the advertising market. He said that Meta will continue to outperform peers like Amazon and Google in the digital ads space as well, citing the company’s integration of AI into its offerings. Morgan Stanley : The Club sold roughly half its stake in the financial name Thursday and used the cash to start a position in peer Goldman Sachs. Morgan Stanley is still a great company with consistent earnings from its wealth management business, along with potential in the investment banking decision on the rebound in Wall Street deals. Goldman, however, seems better suited to outperform next year. Microsoft : This is the Big Tech name that Jim’s most concerned about. We’re upbeat on cloud computing division Azure and the gaming business, but Microsoft’s generative AI assistant Copilot is giving us pause. “If you asked me which Mag 7 stock I am least confident about when it comes to earnings, it would be this one,” Jim said. “I know office AI is doing better than consumer AI so maybe that can make it less worrisome. But I do have trepidation given the high expectations for 2025.” As a result, Microsoft was removed from the core holdings list. Nvidia : The demand for Nvidia’s AI chips will continue to get stronger in 2025. Although some chip companies have grabbed business, it’s hard to imagine any of them catching up to Nvidia and the capabilities of its Blackwell platform. Nextracker : Although this solar stock is cheap, we can’t find a reason to buy more anytime soon. There doesn’t seem to be a clear catalyst for Nextracker on the horizon after Republicans swept in the November elections. The solar industry is concerned about potential repeals to clean energy tax credits. Palo Alto Networks : This cybersecurity stock has turned itself around after a lackluster start to 2024. Candidly, we even considered exiting the position entirely for peer CrowdStrike, but we’re glad we stuck around. Palo Alto’s firewall business is doing incredibly well, and continues to be chosen by some of the world’s largest companies. Starbucks : A few months into CEO Brian Niccol’s tenure, the company continues to face headwinds such as unionization votes and weakness in its China and India markets. Jim said there’s no reason for investors to worry yet. With Niccol’s track record at Chipotle, the company will make progress on these issues in 2025. Stanley Black & Decker: It’s hard to justify owning this toolmaker right now. Management recently lowered its financial outlook on Trump’s proposed tariff increases for China. Last month on Mad Money, we became even more concerned after CEO Don Allan shared downbeat remarks for the toolmaker’s 2025 performance. Unfortunately, the market’s currently too oversold to sell some shares. Constellation Brands: In 2025, the maker of Corona and Modelo beers faces the headwind of higher costs on foreign-made goods. The president elect has threatened 25% tariffs on Mexico, in particular. But unlike troubled Stanley Black & Decker, Constellation Brands CEO has downplayed these concerns to Wall Street. It’s not a big worry for us either. TJX Companies : Jim said that this discounted retailer should have a terrific 2025 as consumers look for retail deals. Plus, TJX is a potential beneficiary of higher tariffs because full-price retailers often over order to mitigate those risks. In turn, they have to liquidate their excess quality inventory to the company. Wells Fargo : 2025 could mean a much better year for Wells, which could finally get its $1.9 trillion asset cap removed — an event crucial to the Club’s investment thesis. It’s still unclear when or if that will happen, but Jim said it would be “pretty unfathomable” if it wasn’t after seven years. When it happens, Wells will be able to expand its balance sheet and invest in new high-growth areas of the business. (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.
Traders works on the floor at the New York Stock Exchange on Dec. 2, 2024.
Brendan Mcdermid | Reuters
Here’s a rapid-fire update on all the 35 holdings in Jim Cramer’s Charitable Trust, the portfolio we use for the CNBC Investing Club. During the December Monthly Meeting on Thursday, Jim looked at each company’s prospects for 2025.
