We’re buying the recent dips on 2 stocks in the most oversold market in over a year
We’re buying 50 shares of CrowdStrike at roughly $354 each and 25 shares of Home Depot at roughly $390. Following Thursday’s trades, Jim Cramer’s Charitable Trust will own 200 shares of CRWD, increasing its portfolio weighting to 2% from 1.5%. The Trust will also own 225 shares of HD, increasing its weighting to 2.5% from roughly 2.20%. Now that the stock market has settled in — trading off its high of the morning after Wednesday’s Fed-induced plunge — we will make a round of buys out of discipline to the S & P 500 Short Range Oscillator . This is the most oversold the market has been since October 3, 2023. Back then, the market sold off after a hot Job Openings and Labor Turnover Survey (JOLTS) caused Treasury yields to surge — on concerns the Federal Reserve needed to raise interest rates. But it turned out to be a good time to hold your nose and buy because the S & P 500 was 3% higher one month later. The Oscillator correctly showed there was too much fear in the market. So with that in mind, we’re adding to our positions in CrowdStrike and Home Depot, which are both high-quality companies. For CrowdStrike, shares are trading back down to where they fell in late November after its third-quarter earnings report. We thought it was a buying opportunity then, and think it is now. This pullback is a good opportunity to scale deeper into this best-of-breed cybersecurity company. For Home Depot, the Fed’s messaging of fewer than expected rate cuts next year and the weak guidance from homebuilder Lennar sent housing and home improvement stocks lower. With bond yields going higher despite the Fed easing, elevated mortgages present some challenges to our thesis. However, housing turnover is at 30-year lows, and we’re willing to be patient on the expectation that 2025 will be a better year. The stock has now dropped 10% from its Dec. 6 high of $431, which created a solid entry point. Please tune in to our December Monthly Meeting at noon ET to hear more about CrowdStrike, Home Depot, and the rest of the stocks in the Club portfolio. That includes the initiation in the banking sector that we sent a trade alert on earlier Thursday morning. (Jim Cramer’s Charitable Trust is long CRWD, HD. 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.
