We are buying 50 shares of Estee Lauder at roughly $134.50. Following the trade, Jim Cramer’s Charitable Trust will own 525 shares of EL, increasing its weighting to 2.2% from 2%. A couple of recent data points from China have us feeling incrementally better about this battleground position. First, China reported late Friday that its consumer price index increased 0.3% year over year in April, higher than forecasts of a 0.1% increase and an acceleration from the 0.1% growth in March. It was also the third straight month of higher consumer prices. These are small steps, but the rising CPI could be a sign that demand for goods in the region is starting to pick up again. The second data point was Alibaba ‘s earnings call on Tuesday. Executive Chairman Joe Tsai said the company has started to see some green shoots in consumer spending on discretionary items. There continue to be headwinds, Tsai said, pointing out that the property sector downturn makes it difficult to get a clear read on the macro environment. But he reiterated there are “some early signs of growth” in consumer confidence. This last part is our main takeaway because everyone knows the consumer is weak in China, but Estee Lauder’s low stock price may not reflect any improvement. Shares of Estee fell 13% after its quarterly report May 1, an unfair punishment for a company that reported a big earnings beat but soft guidance on what should have been low expectations. The guidance may have been too conservative now that inventories have normalized and margins will improve from the profit recovery plan. Market share in the United States should get better, too, thanks to the launch of Clinique on Amazon. China is still the wild card, making this position a higher-risk and more volatile as we’ve said before, but we’re becoming more optimistic down at these prices. (Jim Cramer’s Charitable Trust is long EL. 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.
