Sell 25 shares of Eaton stock for approximately $380. After Friday’s trading, the Jim Cramer Charitable Trust will own 270 shares of ETN stock, reducing its weight from about 2.9% to 2.7%. We record profits as an electronics manufacturer. By returning to about $380 per share, Eaton’s stock has almost fully recovered from its more than 7% decline on Aug. 5 after the company’s third-quarter outlook fell short of consensus estimates. The post-earnings decline was not surprising given the strength of the company’s Electronics Americas business and the capacity it is adding to meet demand. At that time, our rating was upgraded to 1, the equivalent of a “buy,” but as the stock price has recovered, we are raising our rating back to 2. This means waiting for a decline before considering adding to the stock. We still strongly believe in AI infrastructure trade, and with trillions of dollars invested by the end of the decade to help build it globally, there is even more room to tackle this topic. ETN YTD Mountain Eaton YTD However, we also keep an eye on the S&P Short Range Oscillator, which is used to determine when the market is technically overbought or oversold. The market is starting to become overbought. After Thursday’s trading, the oscillator rose to 2.41%, but Friday’s lower-than-expected rise in the October Consumer Price Index will likely push the oscillator higher. If the reading is above 4%, the market is technically overbought. (Below -4% is a signal of oversold.) Overbought is not necessarily the same as selling, but it can act as an incentive to take some profits after a solid move. Since July 15th, the oscillator has not flashed either overbought or oversold, the longest period in this more normal region in at least 20 years. This sale represents a gain of approximately 68% on the Eaton shares purchased in November 2023. (Jim Cramer Charitable Trust is a long ETN. See here for a complete list of 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.
