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. The S&P 500 is on a seven-year upward trajectory as markets continue to recover following the easing of tensions in the Middle East. Stock markets initially got off to a slow start for the day amid uncertainty over the opening of the Strait of Hormuz. The impasse on the Iranian side of the negotiations is Israeli operations in Lebanon. At one point during the day, WTI crude oil was trading at $102 per barrel. However, the market reversed after Israel’s prime minister announced that he had instructed government officials to begin ceasefire negotiations with Lebanon as soon as possible, accelerating gains as oil prices fell below $100. Costco stock rose slightly after the company reported another impressive monthly sales figure. The wholesale retailer’s net sales for the five weeks ended April 5 were $28.41 billion, up 11.3% from the same period last year. On a comparable sales basis, the company reported 9.4% year-on-year growth, up from 7.4% in February, due in part to higher gasoline prices. Excluding changes in gasoline prices and foreign exchange, comparable sales increased by 6.2% year-on-year. These numbers would have been even better had Easter calendar changes not resulted in one less shopping day in March than last year. The company estimates that this timing factor negatively impacted both total and comparative sales by approximately 1.5 percentage points. While there is little doubt that Costco’s performance is in the upper echelons of the retail industry, we would like to better understand whether higher gas prices are driving an influx of new members and helping to stabilize renewal rates. Another potential catalyst that has been mentioned by more analysts recently is special dividends. The company has traditionally made one payment every three to five years. The last special dividend was at the end of 2023 ($15 per share), so we’re nearing the start of a potential period for another special dividend. There will be no significant gains after the close of trading on Thursday or before the opening of trading on Friday. On the data side, we can see March CPI, factory orders, University of Michigan sentiment survey, and durable goods orders. The CPI report predicts a significant increase to 3.4% year-on-year due to rising energy prices. (See here for a complete list of Jim Cramer Charitable Trust stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive trade alerts before Jim 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.
