We're adding to our position in a slumping stock this week
Source
We are buying 80 shares of Bank of New York at roughly $153.09. Following the trade, Jim Cramer's Charitable Trust will own 400 shares of BNY, increasing its weighting to about 1.6% from 1.25%. We're picking up more shares of BNY as the stock continues to drift lower this week; it's down about 6% and the third weakest name in our portfolio. The financial group is the worst-performing S & P 500 sector this week, pressured by Bank of America's comments that trading revenue will be roughly flat and investment banking fees will fall at least 10% in the third quarter, as well as concerns that the Federal Reserve's rate hike could increase deposit costs and weigh on loan growth. BNY shares have been swept up in the pullback even though the company gave a relatively upbeat presentation at the Barclays Global Financial Services Conference on Monday. We detailed some of CFO Dermot McDonogh's key comments when we bought shares Tuesday. Our main takeaway from the meeting was management's commitment to delivering positive operating leverage in 2027, meaning revenue will grow faster than expenses. That's been a key focus for Robin Vince since becoming CEO in 2022. Also, the impact of the Fed's rate hike on deposit costs, net interest margins and loan growth should be less significant for BNY than for more traditional banks. Remember, BNY makes most of its money from collecting fees from servicing, safeguarding, and moving financial assets for institutions. Roughly 70% of its revenue is fee-based. (Jim Cramer's Charitable Trust is long BNY. 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.