Costco is the stock to buy off of Walmart big quarterly beat

Every weekday the CNBC Investing Club with Jim Cramer holds a “Morning Meeting” livestream at 10:20 a.m. ET. Here’s a recap of key moments. The Dow on Thursday topped 40,000 for the first time ever. The S & P 500 and the Nasdaq also hit record highs for the second session in a row — pushing the market further into overbought territory. “I have always felt that when you have a huge, fast move up, it’s incumbent to take something off the table because you can have a huge fast move down,” Jim Cramer said Thursday. That’s why we trimmed our positions in Morgan Stanley on Wednesday and Palo Alto Networks on Thursday. Honeywell has had a lackluster year. Jim said the industrial conglomerate “needs a makeover” and should learn from General Electric ‘s split into three companies — one of which became Club name GE Healthcare . Honeywell has its hand in too many industries and should focus on higher-growth business, Jim said. To be sure, Honeywell plans to divest up to 10% of revenue streams not aligned around its three identified megatrends of automation, aviation, and energy transition. However, we want to see more aggressive action from management. Costco shares hit all-time highs after retailers soared on Walmart ‘s strong quarter and guidance raise. Dow stock Walmart also rose sharply to all-time highs. “I continue to think Costco is the stock to buy off of Walmart,” Jim said Thursday. “Costco and Walmart are where this frugal consumer [goes].” Continued concerns around the U.S. economy and sticky inflation leave shoppers wanting more price-friendly goods that Costco’s membership offers. (Jim Cramer’s Charitable Trust is long HON, COST, PANW, MS, GEHC. 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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