Why DuPont is proposing a reverse stock split, another Nvidia team up

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. Stocks are falling for the second straight session as the S&P 500 hits a new low for 2026. The decline from the record high close on Jan. 27 is now roughly 5.75%. Historically the S&P 500 has a 5% pullback a few times a year, but they never feel good while it's happening. Keeping emotions in check is exactly why we trust the S&P Oscillator in situations like these. This technical indicator helps us identify when the market is oversold and sentiment has turned too negative. The oversold situation is why we pick one or two stocks to buy small each day while keeping plenty of dry powder in case geopolitical tensions escalate and oil prices rise. DuPont is seeking shareholder approval for a reverse stock split in the range of 2-for-1 to 4-for-1, with the exact ratio determined by the board of directors, the company announced late Wednesday. You don't often see reverse stock splits among established companies; They are typically undertaken by smaller companies whose stock prices have fallen sharply and must be above a certain threshold to maintain their listing on the stock exchange. However, there is also some precedent from another industry that has also undergone a significant number of changes. GE completed an 8-for-1 reverse split in July 2021. This was before the spinoffs of GE Healthcare and GE Vernova. The company made the move to shrink its approximately 8.8 billion shares outstanding at the time to "levels more consistent with companies of GE's size and scope." DuPont ended 2025 with about 420 million shares outstanding, making it very different from GE. We'd like more clarity on why DuPont is pursuing this, but the company has built goodwill with investors over the past six months following its value-creating spinoff of Qnity Electronics. Speaking of Qnity, it is collaborating with Nvidia to accelerate AI-driven innovation, the company said Wednesday. The two companies are teaming up to advance materials research and development to support next-generation artificial intelligence, high-performance computing and advanced packaging technologies. The news doesn't mark any progress for Qnity on Thursday, but it's an increasingly positive development to see the company deepen its partnership with Nvidia to support future AI demand. FedEx will report after the closing bell on Thursday, and we'll focus on CEO Raj Subramaniam's comments on how geopolitical tensions and rising fuel costs are affecting global trade. There are no major earnings reports or economic data releases on Friday. (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 would wait 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.