The portfolio’s 5 best-performing stocks since the February Annual Meeting

Published Wed, Mar 27 202410:32 AM EDT

The stock market has grinded its way several new all-time highs since our Annual Meeting in late February, shrugging off hotter-than-expected inflation data as the U.S. economy continues to demonstrate impressive resiliency in the face of elevated interest rates. Ahead of Wednesday's Monthly Meeting, here's a look at the best-performing Club stocks since Feb. 23, the session before the annual gathering, through Tuesday's close. NVDA mountain 2024-02-23 Nvidia's stock performance since the close of Feb. 23, 2024. Nvidia remains the big winner, advancing 17.4% since the Annual Meeting. In the days leading up to that meeting, the dominant artificial intelligence chipmaker released picture-perfect fourth-quarter results, so the setup for the past few weeks was strong. The good news has continued, with management making it clear at industry conferences that the runway for further growth remains massive, followed by an impressive GTC developers conference last week. At GTC, in addition to officially unveiling its next-generation Blackwell chip architecture, we got a closer look at the various ways in which Nvidia is looking to expand its software and services offerings. Announcements included the availability of Omniverse on Apple's Vision Pro headset and Nvidia Inference Microservices , or NIMs. We think the push into services is key to further upside. Demand for AI hardware appears sustainable in the near-to-mid-term, but services will be key to reducing earnings cyclicality over time, supporting profit margins and, as a result, warranting a higher valuation multiple for the stock. DIS mountain 2024-02-23 Disney's stock performance since the close of Feb. 23, 2024. Disney is the second big winner for the Club since last month's Annual Meeting. In general, the return of CEO Bob Iger more than a year ago has helped sentiment and, more importantly, prompted a hard look at cost cutting and a search for additional growth avenues, including ways to better leverage ESPN. However, the main factor driving shares over the past month is likely the proxy battle being fought between management and Nelson Peltz's Trian Partners. The pressure is on Disney management to right the ship and find that magic shareholders are looking for. We are supporting Peltz in the fight for board seats , but regardless of how the vote shakes out, both sides seemingly have been working to increase shareholder value. One thing that's clear is we won't be seeing ridiculous costs or value-destroying acquisitions made anytime soon. How much you want to attribute to Iger simply doing what he always intended and how much should be attributed to Peltz's pressure can be debated. But the idea that there is pressure on management and that Disney is getting back on track has been good for nearly 50 percentage points since the stock bottomed at the end of October 2023, a few weeks after Peltz came back into the picture , and 11.3% since the February Monthly Meeting. ETN mountain 2024-02-23 Eaton Corp.'s stock performance since the close of Feb. 23, 2024. Shares of Eaton are up 9.5% since the February meeting, occupying the third spot in our rankings. Sustained interest and investment in generative AI is certainly playing a role in the move. Remember, Eaton is a key player in the electrical components required to power the data centers in which AI computing processes actually take place. In fact, The Wall Street Journal recently published an article in which reporters noted that while the exact requirements aren't yet known, it's become quite clear that "the data centers needed to advance AI will require so much power they could strain the power grid." In addition to data centers, Eaton has exposure to several other megatrends including e-mobility. In recent weeks, we received a positive Eaton announcement related to hybrid electric vehicle power management and approval from the Federal Aviation Administration for nitrogen generation system oxygen sensor inside a Boeing aircraft. A 9% increase to the dividend , announced on February 29, didn't hurt either, nor have several price target hikes from Wall Street analysts. STZ mountain 2024-02-23 Constellation Brands' stock performance since the close of Feb. 23, 2024. Constellation Brands has been another strong performer for the Club, advancing roughly 8.9% since the Annual Meeting. The run really started at the end of the first week of March, around the time Nielsen sales data pointed to an improvement in beer sales trends, though overall industry sales were still down. More importantly, citing Nielsen tracker data, analysts at Wedbush Securities said in a note that Constellation outperformed the broader group, gaining 2.2 percentage points of market share. Driving the gain was a 1.6 percentage point gain in dollar share for the combined beer category, Wedbush said, citing Nielsen. Wine sales were down for Constellation Brands during the period, falling 5.8% year over year. However, beer is the focus for investors as it is well understood that management is still working to address its lagging wine portfolio. DD mountain 2024-02-23 DuPont's stock performance since the close of Feb. 23, 2024. Rounding out the top-five list is DuPont , which is up 8% since the February meeting. The stock started the year on a rough note after preannouncing disappointing earnings in late January. However, the stock bottomed when the chemicals company reported full numbers and management confirmed that the first quarter was the low point – in other words, things weren't great, but they were going to get better, not worse, as the year progressed. That alone was enough for the stock to pop over 7% that day, and momentum has continued since then. A key driver of the gains in recent weeks is likely commentary made by management at a Barclays industrial conference. The team noted that inventory destocking is now behind the company and orders are coming back online stronger than expected, up low double digits since December, compared with an 8% increase they were forecasting on the earnings call in early February. (Jim Cramer's Charitable Trust is long NVDA, DIS, ETN, STZ and 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. 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Jensen Huang, co-founder and chief executive officer of Nvidia Corp., speaks to the media as he arrives at an event in Taipei, Taiwan, on Thursday, Jan. 25, 2024.

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