Jim Cramer’s Investing Club meeting Tuesday: Wells Fargo, trades, Emerson Electric
Every weekday the CNBC Investing Club with Jim Cramer holds a “Morning Meeting” livestream at 10:20 a.m. ET. Here’s a recap of Tuesday’s key moments. Stick with Wells Fargo Initiating CAT, selling SBUX Buy Emerson Electric 1. Stick with Wells Fargo Jeffries and Piper Sandler on Tuesday both downgraded Wells Fargo (WFC) to the equivalent of a hold, citing concerns over the bank’s lower-than-expected forecast for net interest income in 2023. Wells Fargo reported fourth-quarter results on Friday. However, we disagree with the downgrades because they don’t account for the fact that Wells Fargo is close to putting its regulatory issues behind it, which will result in meaningful cost reductions. In addition, management said Friday that the bank plans to resume share buybacks this quarter after repurchasing $10 billion worth of stock in 2022, bolstering our confidence in WFC. 2. Initiating CAT, selling SBUX We initiated a position in industrial giant Caterpillar (CAT) Tuesday, buying up 55 shares at $257.86 apiece. Our purchase of CAT, which manufactures construction and mining equipment, is in line with our enthusiasm for industrial stocks that should see tailwinds from several federal funding programs this year. At the same time, we sold 50 shares of Starbucks (SBUX) at about $106.87 a share. The coffeemaker’s stock is up 26% since we first initiated a position in August , helped by China’s economic reopening. 3. Buy Emerson Electric Shares of Emerson Electric (EMR) were trading down around 4.8% in midmorning trading Tuesday, at $91.52 a share, after the company launched a $7.6 billion hostile takeover bid for National Instruments (NATI). If the deal goes through, it would be in line with the Emerson’s strategy of investing in high-margin automation opportunities. This is a great chance to buy shares of Emerson on a dip. (Jim Cramer’s Charitable Trust is long CAT, EMR, SBUX, WFC. See here for a full list of the stocks.) 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.