Stock portfolio update highlights Cramer’s top picks
Jim Cramer’s September portfolio adjustments included six stocks he identified as compelling buys, even as the fund reduced its holdings in AI-linked companies. The changes were discussed during the CNBC Investing Club’s monthly session, where Cramer and portfolio manager Jeff Marks also addressed the recent sale of Corning shares and lessons learned from the exit.
This month’s selections emphasize firms with either defensive qualities or underappreciated growth potential. Unlike earlier selections, none of the current picks represent pure AI exposure, marking a deliberate shift in the fund’s AI holdings.
Kimberly-Clark led the recommendations despite a recent earnings shortfall. The company’s proposed acquisition by Kenvue could streamline operations and strengthen its consumer health brands, including Cottonelle and Huggies. Cramer viewed the stock’s decline following the earnings warning as an opportunity to expand the existing position, particularly given the acquisition’s potential to improve cost efficiency and brand management.
Bank of New York Mellon (BNY) was framed as a safer alternative to Capital One, with roughly 70% of its revenue derived from fee-based services rather than interest-sensitive lending. Under CEO Robin Vince’s leadership, the bank has achieved 14 consecutive quarters of revenue growth and set new sales records over two years.
The fund’s AI exposure remains in Nvidia, which trades at just 14 times projected 2028 earnings—a valuation Cramer deemed unusually low for a company dominating AI infrastructure. The recent acquisition of Hugging Face expanded its ecosystem. Cramer noted that the stock is an “own-it, don’t-trade” holding.
Tech Stocks: Intel and Micron’s Undervaluation
Among other technology holdings, Intel was highlighted as undervalued following its recent decline. Concerns about potential government sales of its shares may be overstated, Cramer argued. He pointed to Intel’s CPU price increases and foundry business growth as signs of a potential rebound.
Micron was reaffirmed as a core semiconductor pick, trading at six times estimated 2027 earnings. Rising memory prices and the upcoming production of advanced HBM chips in January support its outlook. Cramer also noted a possible December catalyst when government restrictions on share repurchases are lifted.
On the cloud and infrastructure front, Meta was singled out as the fund’s top choice among the Magnificent Seven. The recent legal settlement with regulators removed a long-standing overhang, and its 19-times earnings multiple remains below peers. Cramer sees it as a play on cloud services expansion.
Cloud, Logistics, and Infrastructure Plays
Logistics and power infrastructure also received attention. FedEx was deemed attractively priced at 16 times earnings ahead of the holiday shopping rush. Meanwhile, GE Vernova was kept as a hold, with order growth accelerating in states considering data center restrictions—a sign that power infrastructure demand remains strong.
Two niche but high-potential stocks, Eaton and Qnity, rounded out the list. Eaton’s electrical equipment business benefits from aging grid infrastructure, while Qnity, often overlooked as a chemicals spin-off from DuPont, produces key materials for semiconductors.
Amazon was absent from the buy recommendations, though the fund retains its position. Cramer emphasized the company’s strengths beyond data centers, particularly in e-commerce and cloud services, as key advantages in a crowded hyperscale market.
The portfolio’s adjustments reflect a more measured approach to AI, favoring companies with either defensive traits or clear growth drivers. The shift toward stability and value-oriented opportunities suggests a preference for selective exposure in an unpredictable market.
Market Caution Drives Selective Bets
Future performance will depend on whether Kimberly-Clark recovers from its earnings setback or if Intel and Micron meet expectations for their foundry and memory pricing trends. For now, Cramer’s selections prioritize resilience over speculative plays, aligning with a cautious outlook on broader market conditions.
December could bring additional clarity if Micron benefits from lifted share-buyback restrictions, while Intel faces potential regulatory or political headwinds. The fund’s next steps will likely hinge on these developments, as well as whether Meta sustains its momentum in cloud services. Cramer also mentioned that any shifts in interest rates could further influence the valuation of financial stocks like BNY Mellon.
