We are selling 10 shares of GE Vernova at roughly $579.30. Following the trade, Jim Cramer’s Charitable Trust will own 70 shares of GEV, decreasing its weighting to about 1.1% from roughly 1.27%. We are locking in big gains on our GE Vernova position through a very small sale. The maker of gas and wind turbines is scheduled to report earnings next Wednesday before the opening bell, and while we have few doubts that the results will be strong and the long-term outlook remains bright, our decision to trim the position is based on concerns that the quarter won’t be good enough to satisfy the market’s lofty bar. Expectations play a huge role in earnings season, and it goes beyond the “numbers” analyst estimate. If a stock comes into the quarter underperforming, the bar is so low that the stock can bounce simply by meeting estimates and rally nicely on signs of a turn. The reaction to PepsiCo’s quarter on Thursday is a good example of that. It’s one of the top gainers in the S & P 500, with shares up more than 6%. On the other side, if the stock enters the quarter too hot, it creates a bar that can become too high to beat, inviting the profit-takers to take over. The reaction to the earnings from the big banks is a good example of this. Another is Thursday’s action in GE Aerospace , which delivered a big beat-and-raise quarter, and yet the stock is lower by about 1%. Shares entered Thursday’s session up nearly 60% from their tariff-driven lows in early April. We want to own GE Vernova for the long haul because the AI-driven power theme is a major secular tailwind, and the company’s gas turbines are sold out for years. But we’re taking profits because the stock’s 75% run year to date puts it at risk of profit-taking when the company reports. From this sale, we will realize a great gain of about 33% on stock purchased in May 2025. (Jim Cramer’s Charitable Trust is long GEV. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
We’re booking profits in a hot stock in case its earnings don’t clear the Street’s lofty bar
