Jim Cramer’s Charitable Trust is making changes to its portfolio by buying 125 shares of DuPont at around $80 and selling 85 shares of Honeywell at around $210.74. This move will increase the trust’s ownership in DuPont to 2.50% and decrease its ownership in Honeywell to 3.25%. The decision to sell Honeywell shares comes after the stock reached a new 52-week high of $210.88, resulting in a 34% gain from the purchase in August 2020.
Honeywell saw a boost in its stock price after completing a $5 billion acquisition earlier than expected and raising its full-year adjusted earnings outlook. Despite the positive performance, Cramer believes that Honeywell needs to make further portfolio reshaping to accelerate growth and improve margins. Until more clarity on the company’s future plans is provided, the trust has decided to move its rating to a 2.
On the other hand, DuPont’s decision to separate into three companies has garnered mixed reactions from Wall Street. While some believe the stock may be stuck in “spin purgatory,” Cramer sees potential for value unlocking if the stock continues to trade at a significant discount. With a sum-of-the-parts-driven $100 price target for DuPont, the trust plans to use a portion of the sale proceeds from Honeywell to buy more shares of DuPont.
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In conclusion, Jim Cramer’s Charitable Trust is taking strategic steps to optimize its portfolio by rebalancing investments in DuPont and Honeywell. The decision to increase DuPont’s weighting and decrease Honeywell’s reflects Cramer’s outlook on the market and each company’s potential for growth. While both companies have shown positive performance, Cramer believes there are opportunities for further value creation through portfolio reshaping and strategic decision-making. Members of the CNBC Investing Club can benefit from Cramer’s insights and trade alerts to make informed decisions in their own investment strategies.
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