What Anthropic’s $50B AI investment means for these 3 portfolio stocks
Every weekday, CNBC Investment Club with Jim Cramer publishes Homestretch, an actionable afternoon update just in time for the final hour of trading on Wall Street. Markets: Stocks were mixed on Wednesday as Wall Street hoped for an end to the record-breaking government shutdown. The House of Representatives will take a final vote tonight on a Senate-backed bill that could reopen the federal government. The Dow hit an all-time high earlier in the session. The S&P 500 and Nasdaq have been under some pressure as technology declines and investors turn to sectors like healthcare and finance. Eli Lilly rose above $1,000 per share for the first time on Wednesday, while Goldman Sachs gained 3%. Both are in the hands of the Club. Data centers: Anthropic plans to pour $50 billion into artificial intelligence infrastructure in the coming years. The investment announced Wednesday will go primarily to building data centers in New York and Texas. The first locations are expected to go live next year, with more likely to follow. Anthropic said energy-intensive facilities should power AI tools and expand research and development for the Claude chatbot maker. Anthropic’s determination is good news for Club holdings GE Vernova, Eaton and Dover, all of which are involved in data center construction. GE Vernova produces the natural gas turbines used to support these facilities, while Eaton produces power management solutions to make these facilities more efficient. Dover also sells thermal connectors and heat exchangers for plants. More AI data centers mean more demand for power solutions. Looking ahead, data center construction doesn’t appear to be slowing down anytime soon. JPMorgan estimates that global data centers, AI infrastructure, and related power supplies will cost over $5 trillion between 2026 and 2030. Analysts called computing demand “astronomical” in a note to clients Monday. Undoubtedly, investors were concerned about eye-watering valuations for AI-related names, which led to a sporadic sell-off in the tech sector last week. Wall Street call: TD Cowen raised its Broadcom price target to $405 from $370 ahead of the company’s earnings next month. Analysts have pointed to increased AI spending by hyperscalers, which have raised their estimates for capital expenditures. OpenAI’s flurry of investment deals also played a role in the PT surge, according to TD Cowen. ChatGPT maker announced partnerships worth billions of dollars with Nvidia, Amazon, Microsoft and Oracle; These partnerships will further increase computing capacity and secure more chips. It is thought that some of this spending will go to Broadcom’s business. But TD Cowen argued that the “bar will be high” for chipmakers like Broadcom this quarter, given the stock’s premium due to the assumption of apathetic demand for custom chips. “We believe Broadcom will likely deliver strong numbers, but we equally believe it is well understood,” analysts wrote, maintaining a buy rating on the shares. Going forward, TD Cowen analysts said Broadcom shares will move in line with revenue expectations for the second half of 2026 and beyond. TD Cowen does not expect these expectations to change meaningfully in the December 11 edition. The firm acknowledged the potential of the “wild card” update during its post-earnings conference call. Next up: The club that owns Cisco Systems will report quarterly earnings after Wednesday’s close. Club member Disney will release its quarterly report on Thursday morning. Outside of the portfolio, other notable releases ahead of Thursday’s open include Brookfield, JD.com and Aegon. On Thursday evening, Applied Materials’ quarterly results will be released. (See here for a complete list of stocks in Jim Cramer’s Charitable Trust.) 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 CAN BE GUARANTEED.
