Every weekday, Jim Cramer’s CNBC Investment Club releases the Homestretch, a practical afternoon update to coincide with the last hour of trading on Wall Street. After a slow start to the week, stocks have been trending higher. Some semiconductor and other AI infrastructure stocks have regained some gains after historic gains and parabolic moves, but Nvidia is on pace for a record closing price. Meanwhile, oil prices and U.S. Treasury yields have edged higher, suggesting continued uncertainty over the reopening of the Strait of Hormuz. Part of the revised agreement between Microsoft and OpenAI announced on Monday was that OpenAI would be able to offer all of its products to customers of any cloud provider. Our first read was that this news would be positive for Amazon Web Services, even if Amazon’s stock price wasn’t all that great. To be fair, Amazon is up 26% this month, so you should expect a drop after a big move. Still, it was nice to see Amazon CEO Andy Jassy’s thoughts on the news through a post on social media platform X. “We had a very exciting announcement from OpenAI this morning. We’re excited that in the coming weeks, along with our upcoming stateful runtime environment, OpenAI’s models will be available to customers directly in Bedrock. This will give builders even more choice in choosing the right model for the right job. More details will be announced tomorrow at the AWS event in San Francisco.” The contract opens the door to further expand that relationship. AWS is hosting a “What’s Next with AWS” event on Tuesday, and the focus is expected to be on Agentic AI. After the closing bell on Wednesday, first-quarter results for Amazon and Microsoft will be announced, as well as quarterly results for Alphabet and Metaplatforms. The four major hyperscalers are all club stocks, and all close overnight. Eli Lilly announced yet another small acquisition Monday, acquiring privately held Ajax Therapeutics in a deal worth up to $2.3 billion. Ajax’s key asset is an investigational, once-daily, oral type II JAK2 inhibitor being studied in a Phase 1 trial in patients with the rare blood cancer myelofibrosis who were previously treated with a type 1 JAK2 inhibitor. This transaction is another example of Lilly using its balance sheet to expand its portfolio beyond GLP-1. Separately, Leerink significantly lowered Eli Lilly’s price target. Analysts maintained an outperform buy rating, but lowered their price target from $1,296 to $1,058 per share, reflecting a 25x forecast for 2027 earnings per share (EPS) of $42.30. Previously, Leerink used a 30x multiple on its 2027 EPS estimate of $43.21. While the underlying earnings forecast remained largely unchanged, Leerink changed the amount investors should pay for the earnings. The reason for the lower target multiple was due to competitive pressure, particularly for oral GLP-1 Foundayo. Indeed, Foundayo has not lived up to very high expectations and has lagged compared to Oral Weogvy, which had first-mover advantage and the same brand name advantage. Although Lilly’s management cautions against comparing Wegovy to Foundayo, they believe Foundayo’s advantage of not having food or water restrictions will allow it to gain market share over time. We’ll hear more about the dynamics of the oral script and sales of Tirzepatide (Mounjaro and Zepbound) when the company reports earnings before the opening bell this Thursday. The list of companies reporting earnings after the closing bell includes Celestica, Cadence Design Systems, Amkor and Nucor. Corning reported before the opening bell on Tuesday, expecting the optical cable market to announce another major partnership with a hyperscaler. Other companies scheduled to report include United Parcel Service, Coca-Cola, Spotify, General Motors, Centene, Hilton Worldwide, S&P Global, Enterprise Products Partners, Kimberly-Clark and Cisco. On the data side, we have the Conference Board’s Consumer Confidence Index. (For a complete list of Jim Cramer’s Charitable Trust stocks, including NVDA, MSFT, AMZN, META, GOOGL, LLY, and GLW, see here.) As a subscriber to Jim Cramer’s CNBC Investing Club, you’ll receive trade alerts from Jim Cramer before he makes a trade. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in his charitable trust’s portfolio. If Jim talks about a stock on CNBC TV, he will issue a trade alert and then wait 72 hours before executing the trade. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
