With the market still oversold, we're putting money to work in this chemicals giant

Published Thu, Oct 5 202311:46 AM EDT

We are buying 65 shares of DuPont de Nemours (DD), at roughly $73.19 apiece. Following Thursday's trade, Jim Cramer's Charitable Trust will own 720 shares of DD, increasing its weighting in the portfolio to 1.93% from 1.76%. With the stock market still deeply oversold, according to the S & P 500 Short Range Oscillator , our strategy is to gradually put a little more money into the stocks of quality, profitable companies. And chemicals giant DuPont de Nemours is our target Thursday. There hasn't been a ton of news on the stock since we initiated a position in early August . But last month the company completed its previously announced $3.25 billion accelerated share repurchase (ASR) and launched a new $2 billion ASR transaction that led to the retirement of 21.2 million shares of common stock. DuPont, under the leadership of CEO Ed Breen, has been able to be aggressive with its buyback program because of how well-capitalized the company is. It has a low leverage ratio and no significant debt maturities until Nov. 2025, an increasingly important factor in the current high-interest-rate environment. In short, management won't need to refinance debt at elevated rates. Valuation is another important factor when rates rise because multiples have a habit of compressing more on pricier stocks. But DuPont is a cheap name relative to some other higher-priced multi-industry peers. At the same time, DuPont shares should actually trade at an expanded multiple closer to peers, given the company's shift to less cyclical, higher-growth end markets like electronics and semiconductors. (Jim Cramer's Charitable Trust is long DD. 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.

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