Cramer's Charitable Trust trims Broadcom stake after parabolic rally, citing disciplined profit-taking and portfolio rebalancing. Simultaneously, AMD position is reduced and downgraded to a 'sell' rating due to evolving insights into the AI chip market.
Shortly after the opening bell, we will be selling 100 shares of Broadcom at roughly $247.20. Following the trade, Jim Cramer 's Charitable Trust will own 650 shares of Broadcom , decreasing its weighting to about 4.50% from 5.15%. In addition, we are selling 375 shares of Advanced Micro Devices at roughly $124.23. After the sale, the Trust will own 300 shares of AMD , decreasing its weighting to about 1% from 2.35%. Now that our trading restrictions have cleared, we can take profits in Broadcom .
The stock went parabolic between Friday and Monday, rallying roughly 38% in reaction to the bullish artificial intelligence outlook CEO Hock Tan provided on its earnings call . Broadcom's custom AI chip business is on fire, and Tan believes it will grow significantly by fiscal 2027, forecasting a serviceable addressable market in the range of $60 billion to $90 billion between his three current AI customers. Those are widely believed to be Alphabet's Google, Meta Platforms and TikTok parent ByteDance. What was even more eye-popping was the fact that Tan thinks Broadcom has two new custom chip customers in the pipeline. If the recent media reports are correct in that those two customers are Club holding Apple and ChatGPT creator OpenAI, then these will be significant wins. The Broadcom story has a lot to like about it, but we are taking our 190% gain on stock purchased in August 2023 out of discipline following the parabolic move. This trim will also right-size our position since the two-day surge has pushed Broadcom's weighting above 5% of the entire portfolio. We also have a change from what we outlined in Monday's Morning Meeting and Homestretch. We are cutting our AMD position by more than half and downgrading our rating to a 3, meaning sell into strength. Our understanding of the AI chip industry has developed a lot in the past wee
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