At the April monthly meeting on Wednesday, we accepted questions directly from investment club members. Below are responses from Jim Cramer and Jeff Marks, Director of Portfolio Analysis. Their answers have been adjusted for length and clarity. 1. Given Wells Fargo’s recent highs, up more than 90% since it was first recommended, is it wise to take a break? Fee-based income in an environment of higher long-term interest rates (Jim, North Carolina) Jeff Marks: A few months ago, when the stock price hit the $50 per share range, are we still in the sweet spot? However, I think further adjustments are needed. This is well above 5%. We achieved great results. By the way, there was a huge move in the terrible market last week. I think a lot of it has to do with buybacks. They have stepped up share buybacks this year compared to last year. I don’t think this is a coincidence, as we have seen significant progress in raising asset limits. Maybe they’re looking forward to it. It’s currently limited, so we’ll have to wait and see. It has performed so well that it is the largest position in the portfolio and has outperformed JPMorgan this year. …The company was one of the best banks to own. 2. There has been a lot of news lately about the rise in the price of gold. What is the best way to invest in gold and when is the right time to do so? (Gary, Philadelphia) Jim Cramer: Visit the club that runs the Costco website and invest in gold. Please purchase. … Games, Sets and Matches. Miners are not working because the cost is too high. Gold bullion purchased from Costco is the best option. 3. How do you determine the level of cash to hold for your investment club? Do you add up your cash each year before paying profits or dividends to charity? (Texas Ed) Jeff Marks: Yes. You can usually see them doing it from the beginning of the year to early spring. Distribution will begin around March. When it comes to cash, it comes and goes. If you see a lot of parabolic movements happening in the market, that’s usually a sign to start raising money.And when the backlash actually occurs, and [the market] Start rolling out when it gets oversold. 4. With the presidential election just months away and summer approaching, what are the areas we should focus on? (Sony) Jim Cramer: Former President Donald Trump wants to strengthen defense capabilities There is. President Trump wants a merger. President Trump wants the stock market to rise. … He doesn’t believe in climate change, but it’s a very positive thing for oil and gas. Jeff Marks: There are differences in tax rate policy. As for corporate taxes, President Trump is likely considering another tax cut, while President Joe Biden could raise them. That’s still many months away. I don’t think we’re necessarily looking at that yet. This week, let’s focus on revenue. 5. Earnings are good, but what are the prospects for Abbott Labs now that we know that the infant formula trial will take place in July? (James) Jim Cramer: It’s not a class action lawsuit. That’s not what hurt Johnson & Johnson. But people act as if it’s exactly the same. And it’s not. …I would like to buy it again, but I have to give it a little discount. I don’t want to buy it over and over again at the same price. That’s not what you do. You scale. Jeff Marks: The outlook is strong. We saw that last quarter. It was a beat. They raised their earnings estimates. They raised their organic sales outlook. Since 2016, we have not raised capital beyond the first quarter. I think 9% organic growth is a really impressive metric. It is also a dividend aristocrat. They have a great balance sheet. But I think the trial in July is keeping people on the sidelines. We still see weakness as opportunity. We might lose in July, but a few wins could make a big difference. 6. At the last monthly meeting, you offered deals to companies you were interested in, such as Alibaba, Baidu, PDD Holdings, and JD.com. For those of us who decided to get into this industry, what do you think about the industry now? (Bob, Minnesota) Jim Cramer: I think the Chinese want the market to go up, so we should keep doing it. I want to say it. It may sound a little silly, but this is a rigged market and it is currently rigged in favor of the owners. Sometimes the government wants to punish you, and sometimes it wants to take it away from you. That’s how it works there. 7. Eaton has performed extremely well since its initial purchase and has far exceeded its cost base. Will you be buying more? If so, at what price? Since your position is so small, should you sell it and move on to another position? (Michael) Jeff Marks: I don’t want you to sell. is.There was a huge price drop from around $330. [per share] Up to about $300. It could be interesting if the mid-$300s get back there. The stock price is down about 10% from its high. I thought Vertiv’s quarter was very indicative of data center trends. That, of course, was the main reason we initiated the Eaton acquisition last fall. Mr. Eaton has a very strong outlook. This is an electrical theme centered around so many different megatrends such as reshoring, reindustrialization, energy transition, data centers, etc. These AI data centers have more electrical components than traditional data centers, which is also a boost for Eaton. 8. Could you reflect on the general long-term trends underlying current investments? For example, you’ve discussed topics like pet humanization and cybersecurity in the past. I would like to hear your current thoughts. (Anthony) Jim Cramer: We love data centers. We love hyperscalers because they thrive in environments where the economy may slow. Remember that March is considered very slow. We like home accessories and whether it’s DuPont or Stanley Black & Decker, that’s very important. But I think overall what we’re looking for is the best possible growth, Eli Lilly, and also the most consistent growth, like Constellation.We are not necessarily influenced by the humanization of pets [like in years past]. It’s just not working right now. What we do is we look at a stock and decide if it’s going to grow significantly. Jeff Marks: Since the passage of the Inflation Control Act and of course AI, we’ve seen more and more long-term industry trends. Grid repair, data center growth, electric vehicles. Electricity demand increased at an average annual growth rate of 0.4% from 2013 to 2023. Bank of America believes that from 2023 to 2030 it will grow at a CAGR of 2.8%. So it’s just a huge step function. I think cybersecurity is still up there, the artificial intelligence boom, re-industrialization, reshoring of supply chains post-pandemic, all positive trends. 9. Foot Locker is currently below the club’s last sales level. Is it time to start buying in stages towards a turnaround, or is the turnaround still too far away? (Nancy) Jeff Marks: Even if it’s lower now than it was when you sold, I think I’ll wait to buy it back. We bought an Estée Lauder last week for about $140, and it’s still very precarious. At Foot Locker, we’ve done a good job on the inventory side, but we had to reinvest a little more this year than the market expected, which caused some timing delays. We are encouraged by what Nike has said in terms of re-embracing the wholesale channel. …I think you should wait for the business to recover a little more before buying. 10. What’s the best way to survive the volatile markets we’re experiencing right now? (Gordon) Jim Cramer: It’s cash. I won’t put it down. We’re not selling phones. In a decline like this, cash is king. This will help you make decisions and keep your head clear. I think we need to monitor our cash position (8.3%). That is actually the trust’s responsibility. …When I looked at all the stocks, I said I like Best Buy and Abbott Labs. I think Wynn is good, but we have a large portfolio so we’re not interested in buying a lot of stocks. One, because we’re not going to violate our fundamentals, and two, it’s not a great market. And owning that is really, really important. (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 a charitable trust’s portfolio. If Jim talks about a stock on his CNBC TV, he will wait 72 hours before executing the trade after issuing a trade alert. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. 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