Jim Cramer's top 10 things to watch in the stock market Monday

Warner Bros. Discovery will split into two public companies by mid-2025, a streaming/studios company led by David Zaslav, and a global networks business run by Gunnar Wiedenfels; shares jumped 9% on the news. BMO Capital increased its price target on Oracle to $200 from $175, while Barclays raised its price target for GE Vernova to $550 from $500, citing strong power generation order growth until 2028-2029. Broadcom's price target was raised to $265 from $215 at Barclays, citing continued strong demand for its AI custom chips.

Analysis

Warner Bros. Discovery announced a significant corporate restructuring, planning to separate into two public companies by mid-2025—a streaming and studios entity and a global networks business—which prompted a 9% surge in its shares, signaling positive investor reception to the strategic shift. Analyst price target adjustments reflect varied outlooks: BMO Capital raised Oracle's target to $200 but simultaneously projected lower operating margins for fiscal 2026-2027, underscoring heightened scrutiny for its upcoming quarterly results, especially after a previous underperformance. In contrast, Barclays issued several positive revisions, lifting GE Vernova's target to $550 based on strong power generation order growth through 2028-2029, increasing Broadcom's to $265 due to sustained robust demand for AI custom chips, and raising Affirm's to $67, highlighting its BNPL market leadership reinforced by its Costco partnership. Walmart also saw a modest price target increase to $110 from KeyBanc. However, Lululemon faced a target reduction to $270 from Barclays amidst concerns over 1% comparable sales growth, perceived high prices, and intense competition. Market attention is also directed towards Apple's Worldwide Developers Conference, where expectations are reportedly low for the stock, and Nvidia's GTC Paris conference, where CEO Jensen Huang's keynote may touch upon strategic initiatives or trade possibilities, including rare earth elements for chips. Broader geopolitical factors, specifically the US's leverage in upcoming trade talks with China concerning critical rare earth element supplies, remain an overarching concern for market stability.

Key Decisions for Investors

• Investors should model sum-of-the-parts valuations for Warner Bros. Discovery post-separation and assess management's execution capabilities for the two new entities.
• Closely scrutinize Oracle's upcoming earnings call for detailed margin guidance and commentary on competitive positioning, given BMO's lowered margin outlook despite a price target increase.
• Consider maintaining or increasing exposure to Broadcom on AI leadership and Affirm on BNPL dominance, supported by strong analyst conviction, but re-evaluate risk/reward for Lululemon given its current operational headwinds and negative sentiment.
• Monitor Apple's WWDC and Nvidia's GTC for product or strategic announcements that could serve as near-term catalysts or alter investment theses for these key technology names.
• Factor potential volatility from US-China trade negotiations, particularly concerning rare earth supply chain disruptions, into portfolio risk management and sector-specific allocations.