Investing Club: We're continuing to reduce our semiconductor exposure with a sale of AMD
Following Monday's trade, Jim Cramer's Charitable Trust will own 470 shares of AMD, decreasing its weighting to about 1% from 1.6%. This small sale of AMD is consistent with what we explained last Monday when downgrading our rating of the semiconductor stock to a 2. While this AMD move is a tough sale to make after its nasty decline this year — and we regret not selling more before the collapse of the PC industry — we believe it's necessary to reduce our exposure to semiconductors.
at roughly $56.97 a share. Following Monday's trade, Jim Cramer's Charitable Trust will own 470 shares of AMD, decreasing its weighting to about 1% from 1.6%.when downgrading our rating of the semiconductor stock to a 2. While this AMD move is a tough sale to make after its nasty decline this year — and we regret not selling more before the collapse of the PC industry — we believe it's necessary to reduce our exposure to semiconductors.
The group is going through a period of significant price-to-earnings multiple compression and earnings cuts — trends that are set to continue as the economy worsens, andOne concern of ours is that the restriction list on artificial intelligence chips and manufacturing equipment will expand to include high-performance computing. The hardline U.S. stance on semiconductor exports is creating too much uncertainty for our liking, which is why are taking this difficult 30% loss on some AMD shares.
Of course, what if the semiconductor decline is already two-thirds through? What if a lot of the bad news and future earnings cuts are already priced in? As such, this is not a decision taken lightly — but our sense is that there is more downside to go, as we said onAs 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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