We’re buying the dip to build up our newest stock position
We are buying 80 shares of Boeing at roughly $217. Following the trade, Jim Cramer’s Charitable Trust will own 240 shares of BA, increasing its weighting to 1.4% from about 0.96%. We initiated a position in the aerospace giant on Monday, and are stepping back in to pick up more shares at more than 5% below our basis. When building a new position, we always aim to make every new purchase at a price point that’s lower than the previous one. Each new buy should serve to reduce the overall weighted average cost basis of the position. Of course, we don’t buy blindly; our investment thesis must stay intact. JPMorgan said Boeing shares fell Thursday after CEO Kelly Ortberg said at a conference that the aircraft maker was falling behind on certification for the 777x. While that isn’t good news, delays like this are not uncommon. Therefore, the resulting stock drops can be viewed as buying opportunities — so long as the delays don’t turn into order cancellations. Revenue missed in one quarter will show up in the next one. We don’t see this latest update altering the company’s trajectory of cash flow, and cash flow will drive the stock over the longer term. The news also doesn’t change Boeing’s status as a key bargaining chip in trade talks. Despite this hiccup, the turnaround is on as Boeing’s balance sheet is in a much better place now following last November’s equity raise. The culture is improving under the leadership of CEO Kelly Ortberg. We’re taking advantage of what is likely a short-term dip to build up our newest holding. (Jim Cramer’s Charitable Trust is long BA. 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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