We’re exiting an oil stock, taking profits after a blockbuster buyout announcement

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We are exiting our position in Pioneer Natural Resources (PXD), selling 300 shares at roughly $249.34 each. Following Monday’s trade, Jim Cramer’s Charitable Trust will no longer own a position in PXD. Now that we are no longer restricted from trading Pioneer , we will ring the register and sell our entire position following the run-up in price in response to the company agreeing to be sold to Exxon Mobil (XOM) for $59.5 billion in an all-stock deal. We do have the option to hold onto Pioneer through to the expected merger completion date of June 30, 2024, become Exxon shareholders at a 2.3234 per share rate, and collect a couple of dividend payments along the way. But we’d rather take profits on this stock trading at its year-to-date highs and redeploy the cash to build up Coterra Energy (CTRA) on pullbacks and buy other stocks of quality companies that have pulled back due during the stock market’s recent slide. Another reason we are not sticking around for the merger completion is that there’s always a possibility of the deal not going through, which would cause PXD to give back some of the roughly 18% premium Exxon is paying. PXD YTD mountain Pioneer Natural Resources YTD Chances of the deal getting blocked are low in our view, but nothing is ever guaranteed when it comes to large-scale mergers and acquisitions, especially in the current regulatory environment. Additionally, there’s been no indication that a more competitive bid for Pioneer is lurking in the shadows. We will realize a solid gain of about 8% on our remaining shares — but it’s worth remembering, that this price return doesn’t reflect the hefty dividend income we received each quarter from the company. (Jim Cramer’s Charitable Trust is long CTRA. 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.

People walk outside of the New York Stock Exchange (NYSE) on September 05, 2023 in New York City.

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