Jim Cramer says this industrial stock is a buy ahead of its breakup
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 Thursday’s key moments. 1. Stocks moved higher Thursday as a rebound in semiconductor names helped investors look past escalating tensions between the U.S. and Iran and a hotter-than-expected wholesale prices report . The Dow Jones Industrial Average rose roughly 341 points, or 0.67%, while the S & P 500 and Nasdaq Composite advanced 0.38% and 0.52%, respectively. Earlier in the session, oil prices climbed after President Donald Trump said the U.S. would strike Iran “VERY HARD TONIGHT” and take control of key Iranian oil infrastructure. However, crude pared those gains as chip stocks powered the market higher. Jim said there are effectively “two markets” right now: one focused on inflation and geopolitics, and another centered on tech and the highly anticipated SpaceX IPO. 2. Wall Street analysts started coverage on SpaceX ahead of its highly anticipated debut, with New Street Research assigning a $165 price target and Oppenheimer setting a $190 target. Jim said the offering is likely to have an outsized influence on broader market trading. “How that deal does is going to determine the action, if not just for the next 24 hours, but for maybe the next month,” he said. That potential impact is one reason the Club has been raising cash in recent sessions, giving us flexibility to navigate any volatility created by the IPO and the wave of capital raising expected to follow. Jim said he hopes the IPO is “tight as a drum,” meaning demand significantly exceeds the available supply of shares. In that scenario, investors who receive smaller allocations may be forced to buy shares in the open market, helping support the stock and offset selling pressure from short-term traders . 3. Club name Honeywell held an investor day on Thursday ahead of its planned breakup into separate aerospace and automation businesses on June 29. Jim remains optimistic about the long-term value creation potential of the automation segment, arguing that investors are underestimating the size of the opportunity. “There are people who do not have the ability to assess how big this market really is,” he said, describing it as “a huge TAM, total addressable market.” While Jim expects some volatility and “grave dislocations” around the separation later this month, he views any weakness as a buying opportunity. “I’d be a buyer,” he said, adding that he sees “50 points to be had” once the restructuring is complete and investors can more clearly value the standalone businesses. Honeywell’s CEO, Vimal Kapur, will be on ” Mad Money ” Thursday night. 4. Stocks covered in Thursday’s rapid fire at the end of the video were: Oracle , Danaher , and Kontoor Brands . (Jim Cramer’s Charitable Trust is long HON. 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.
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