We're trimming a big winner and buying the dip in a stock that shouldn't be down

Jim Cramer's Charitable Trust sold 15 shares of Goldman Sachs at about $938 each, trimming GS to 170 shares and reducing its portfolio weight to 4.15% from 4.5%, while realizing roughly a 67% gain on stock bought in December 2024. The Trust bought 65 shares of Johnson & Johnson at about $223, lifting JNJ to 290 shares and raising its weight to 1.7% from 1.3%. The article is primarily a portfolio-management update, with the J&J buy supported by recent clinical progress on the Ottava robotic surgery system and broader confidence in the company’s earnings beats and outlook.

Analysis

GS is signaling a late-cycle monetization phase rather than a fundamental break: trimming into strength after a material run suggests the market is now pricing a cleaner capital-markets recovery and better trading conditions, leaving less upside unless deal activity re-accelerates. The second-order issue is that investment banking beta is now more exposed to rate volatility and equity issuance windows than to pure earnings momentum; if the macro backdrop stays constructive, the stock can grind higher, but the asymmetry from here is less attractive than it was on the initial rebound.

JNJ looks less like a sentiment trade and more like an under-owned quality compounder with a multi-year catalyst stack. The market is discounting healthcare because AI is absorbing attention, but that creates a positioning vacuum: anything that converts product milestones into a credible pipeline of launches can rerate quickly once portfolio managers rotate back to defensives. The Ottava update matters because it shifts the narrative from patent-and-litigation dullness to optionality in MedTech, which can pull through hospital capital spending, procedure mix, and later-stage adoption economics over 12-24 months.

The bigger contrarian point is that healthcare’s weak relative performance may be setting up a crowded reversal if earnings durability remains intact. A broad bid into JNJ, CAH, and peers would likely come from funds seeking lower correlation and visible guidance, especially if AI winners pause or the market narrows. The risk to the thesis is execution slippage: any delay in regulatory pathways, slower-than-expected adoption, or a risk-on melt-up in growth names could keep capital pinned away from defensives longer than expected.

Key Decisions for Investors

• Long JNJ on weakness over the next 1-3 months; target a 10-15% rerating if MedTech catalysts continue to de-risk, with downside limited by defensive cash flow and recurring dividend support.
• Use GS strength to fade rallies via a 1-2 month covered-call or partial reduction strategy; upside now looks more constrained unless equity capital markets and M&A activity inflect higher.
• Pair trade: long JNJ / short a healthcare basket with weaker earnings visibility over the next quarter; the setup favors quality balance sheet and execution consistency over lower-quality defensives.
• Add CAH selectively as a lower-volatility healthcare beneficiary for 3-6 months; if healthcare rotation starts, distributors can catch a sympathy bid before higher-multiple med-tech names.
• If JNJ breaks above its recent range on volume, consider a call spread rather than outright stock for 6-12 month upside participation with defined risk.