Here's our monthly update on our 32 stocks, including 2 more names to buy

Jim Cramer and portfolio director Jeff Marks described a cautious, selective stance amid pressure on the AI trade: they marked Broadcom for sale, while saying they would look to buy more Alphabet on weakness and continue to own Nvidia. Goldman Sachs and Starbucks were identified as their favorite stocks to buy, and the portfolio added to BNY after the bank beat revenue and earnings expectations. The commentary also cited risks from higher interest rates, oil prices and potential debt problems among data-center builders, alongside positive views on several companies’ earnings, products and growth prospects.

Analysis

The useful signal is not the portfolio manager’s stock picks, but the split between AI companies that can monetize demand and those whose returns depend on continued external financing. AVGO’s customer concentration makes it especially exposed if AI labs slow or restructure spending; a sector-wide selloff could therefore mask a sharper deterioration in the funding chain. By contrast, MSFT and META have existing distribution and cash-generating businesses that may absorb AI investment better, though their own returns still depend on converting usage into revenue rather than simply expanding capex.

Near term, rising rates and scrutiny of data-center financing can pressure both chip suppliers and infrastructure beneficiaries such as ETN and GEV. The latter are not pure AI bets: grid investment provides a partial structural offset, but does not prevent a drawdown if data-center projects are deferred. Over 6–18 months, the key discriminator is realized utilization, customer-funded investment, and power demand—not AI announcements. AAPL’s lighter direct exposure to data-center capex may support relative resilience, but device demand remains a separate earnings risk.

Treat the commentary as portfolio positioning, not independent evidence of earnings revisions. The strongest contrarian opportunity is selective relative value rather than buying or selling the AI complex wholesale. Falsify the cautious AVGO view if customer commitments and cash-funded deployments remain firm; falsify the durable infrastructure thesis if project cancellations or order/backlog commentary weaken. For SBUX and GS, wait for operating results and deal activity to validate the bullish narrative.

Key Decisions for Investors

• Consider a modest long MSFT / short AVGO relative-value position to express a preference for monetization and distribution over customer-concentration and financing exposure. Reassess if AVGO’s customer commitments and cash-funded deployments remain robust or if MSFT cloud growth/AI monetization disappoints.
• Do not chase ETN or GEV solely as AI infrastructure proxies. Keep them on a pullback watchlist and add only if order/backlog evidence supports grid demand independent of data-center project timing; cut the thesis if cancellations or management commentary show broad project deferrals.
• Treat the AI drawdown as a dispersion setup, not a blanket short: monitor hyperscaler capex against operating cash flow and utilization over the next 1–3 months. Weakening funding or delayed deployments would favor reducing exposed suppliers; stable customer-funded spending would argue against extending shorts.
• No immediate trade in SBUX or GS from this source alone. Verify comparable-store sales/margins for SBUX and deal pipeline/underwriting trends for GS before adding; promotional conviction is not a substitute for measurable earnings revisions.