We’re pocketing gains in this rallying chipmaker to right-size position
We will sell 100 shares of Broadcom at approximately $367 shortly after the opening bell. Following the trade, Jim Cramer’s Charitable Trust will own 415 shares of Broadcom, reducing its weight in the portfolio from 5.3% to approximately 4.3%. We laid out our plan on Friday to correct our position at a time when we are no longer restricted from trading. Shares are having a strong week after the chipmaker signed a long-term exclusive accelerator and network supply deal with Alphabet through 2031. The company also expanded its supply agreement with Anthropic to 3.5 GW of TPU capacity from 2027. The stock’s 18% rise last week made Broadcom our largest position in the portfolio. Historically, we have managed the Charitable Trust to prevent overgrowth of a single position and have used a threshold above 5% as a general guideline for taking action at the right size. This is the same discipline we used when we downsized Goldman Sachs last week. Despite reporting better-than-expected revenue and earnings per share in the first quarter, Goldman fell in premarket trading after missing out on closely watched fixed income trading revenue. We’ll have more information about Goldman later. We still have a positive long-term view on Broadcom, but we’re downgrading it to 2 after its recent rise. From this sale, we will receive a gain of approximately 319% on Broadcom shares purchased in September 2023. (Jim Cramer’s Charitable Trust is long AVGO. See here for a full list of stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. 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 CAN BE GUARANTEED.
