Every weekday, CNBC Investing Club joins Jim Cramer to publish Homestretch, a day update just in time for the last hour of trading on Wall Street. (We now not record audio, so we are able to make this latest written feature available to members as soon as possible.) Markets Rebound as Nvidia Goes Green: After a slow begin to the session, Nvidia shares have recovered from their early lows and are trading higher on the day. One reason for the positive turnaround could possibly be the understanding that enormous cloud providers and other big tech firms are likely already lining as much as get their hands on Nvidia’s latest AI hardware. “Amazon CEO Andy Jassy said he would be happy if he could get as many tokens as he could get his hands on,” Jim Cramer said. However, what Nvidia has completed by way of AI development is rather more essential than simply cloud computing. This can have a positive impact on many real-world applications akin to the healthcare industry. “Nvidia is devoting all the time needed to conduct drug testing. This will shorten it dramatically,” Jim said. Over time, he added, these AI-powered drug discovery improvements could translate into “more money for Danaher,” a life sciences club holding company whose clients include pharmaceutical firms. In the near term, it is important to do not forget that Danaher “is in a sweet spot whenever we see $2-3 billion acquisitions of biotech companies,” Jim said. Indeed, we saw one other such deal within the biotech space on Tuesday. AstraZeneca has agreed to purchase Fusion Pharmaceuticals for as much as $2.4 billion. Another announcement that caught our attention was Nvidia’s introduction of the Omniverse 3D application platform for Apple Vision Pro mixed reality headsets. “Commercial applications of Vision Pro just skyrocketed because [Nvidia CEO Jensen Huang] it showed how you could buy a car with it,” Jim said. “A simulation can be better than a test drive because you can then ask to buy a car that meets your specifications.” We call this synergy between Club’s two long-standing holdings, that are “Hold, Don’t Trade” the stock in Jim’s words. It’s only a matter of time before the market really starts to understand Nvidia’s emphasis on software and services like what Omniverse provides. Watch more of Cramer’s exclusive videos with Huang on Mad Money on Tuesday and Wednesday nights. Continuation of morning meeting: Part of Tuesday morning’s meeting focused on the recent conflicts at Starbucks and the court overhang affecting Abbott Laboratories. Since Jim was unable to attend the morning meeting, he shared his thoughts on two stories. Referring to Starbucks, he said: “People don’t want to say sell because maybe that’s what the trough looks like.” There are just a few alternative ways to take a look at the trough. It could possibly be about “computers” or the identical… in-store sales, that are currently going through a difficult period resulting from headwinds in China, the Middle East and the afternoon time of day within the US. It could also indicate valuation, as many analysts have cited Starbucks’ low price-to-earnings ratio compared historically. At Abbott Labs, Jim said, “If Abbott stock falls again, buy it. Exposure to lawsuits is unfortunately a normal situation. Numbers; [Johnson & Johnson] sues 80,000 plaintiffs. Abbott has such a small number that it could quadruple, not fivefold, before we should even include it.” As of January 31, there have been 993 Abbott cases pending in federal and state courts. GLP-1: It’s hard to get through a day without the drug referred to as GLP-1, which is becoming increasingly popular within the news. Oprah Winfrey hosted a TV special on Monday night where she discussed the health advantages she has received since taking these revolutionary drugs which have helped destigmatize weight reduction drugs. We’re all still attempting to determine exactly what changes to consumer tastes and habits these drugs will cause, but one area where risk is increasingly being considered is alcoholic beverages. Jim believes that Brown-Forman’s stock has fallen to its lowest level in 4 years might be explained by means of GLP-1. “The company says there is no way. But the explanation is simple: why pay for high-end wines and spirits if they all taste the same? This is the dilemma of GLP-1,” he said. However, Cramer doesn’t think all alcoholic beverage firms fall into this trap. “Beer does not suffer from the GLP-1 dilemma because it is a social drink. And Constellation Brands prices are reasonable,” he added. Constellation Brands shares are currently trading at around $5 per share, or about 2% from Club Holding’s all-time high reached in July. A take a look at Wednesday: A busy day with morning earnings from Chinese online retailer Pinduoduo and packaged food company General Mills, followed by Broadcom’s AI Infrastructure Invest Event starting at 12 p.m. ET. Then at 2 p.m. ET we’ll get a policy announcement from the Federal Reserve’s Federal Open Market Committee, followed by a press conference from Chairman Jerome Powell a half-hour later. While no rate of interest cut – or for that matter, increase – is expected, the March meeting is noteworthy since the Fed will release an update to its economic projection materials, including gross domestic product, unemployment rate and PCE inflation projections, in addition to so-called points” that assess each FOMC participant’s view of appropriate monetary policy. (See the complete list of Jim Cramer’s Charitable Trust stocks here.) As a CNBC Investing Club subscriber with Jim Cramer, you may receive trade alerts before Jim makes a trade. Jim waits 45 minutes after sending a trade notification before he buys or sells shares in his charitable fund portfolio. If Jim mentioned a stock on CNBC, he’ll wait 72 hours after the trade alert is issued before executing the trade. THE ABOVE INFORMATION ABOUT THE INVESTING CLUB IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY ALONG WITH OUR DISCLAIMER. NO OBLIGATIONS OR FIDUCIARY OBLIGATIONS EXIST OR CREATE BY THE RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. WE DO NOT GUARANTEE ANY SPECIFIC RESULTS OR PROFITS.
Jensen Huang, co-founder and CEO of Nvidia Corp., arrives at an event in Taipei, Taiwan on Thursday, January 25, 2024.
Lam Yik Fei | Bloomberg | Getty Images
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Every weekday, CNBC Investing Club joins Jim Cramer to publish Homestretch, a day update just in time for the last hour of trading on Wall Street. (We now not record audio, so we may make this latest written feature available to members as soon as possible.)
