We are purchasing 25 shares of Danaher at approximately $229 each. Following Monday's trade, Jim Cramer's Charitable Trust will own 550 shares of DHR, increasing its weighting to about 3.6% from 3.4%. The healthcare sector has been the biggest loser in the market since the election. If the SPDR Healthcare Sector Fund, commonly known as XLV, trades lower on Monday, it will mark its sixth consecutive negative session. The group faces a wave of uncertainty after President-elect Donald Trump chose Robert F. Kennedy Jr., a vaccine skeptic and critic of obesity drugs, as his secretary of the Department of Health and Human Services. Humans. There's nothing the market hates more than uncertainty, which is why stocks can fall so sharply when there's no clear policy view. But uncertainty can also create opportunities. We never want to downplay risks, but at some level, a stock will have too many potential price changes, reflecting outcomes that may be too harsh. If what happens in real life turns out to be better than initially feared, then nibbling on high-quality healthcare names at these prices could prove to be a bargain. We're not buying much here because uncertainty could persist for some time, but some of these stocks are becoming oversold. That's why we're turning to a couple of healthcare stocks that have taken a hit over the past few weeks. Since the election, Danaher shares have fallen from $250 each to $230, while Eli Lilly shares have fallen from $806 to $720. DHR YTD mountain Danaher YTD Danaher reported a better-than-expected quarter with a return to growth in its bioprocessing business. Bioprocessing is the use of cellular components to make various products, including targeted therapies such as vaccines. Danaher won a lot of business with vaccine manufacturers during Covid. Part of the reason Danaher has come under pressure after RFK Jr.'s election is concerns over funding for the National Institutes of Health, the country's national medical agency and part of HHS. But as analysts at Leerink estimated in a research note on Monday, less than 1% of Danaher's revenue is exposed to NIH funding. The flip side of Danaher's risk is that pharmaceutical companies reduce research and development due to regulatory changes. This will be something to keep an eye on going forward, but we think Danaher's stock trading at around 27 times 2025 earnings estimates reflects some of this risk. Separately, we would be buyers of five shares of Eli Lilly at about $718 each if we had no trading restrictions. The five shares represent half of what we sold in early September, when shares were trading at around $960. LLY YTD mountain Eli Lilly YTD Eli Lilly shares fell from $903 to $846 after a disappointing third-quarter report in which shrinking inventory of its fast-selling GLP-1 drugs caused the company to default with estimates and reduce forecasts for the entire year. We were concerned by Eli Lilly's messaging after the quarter, but were encouraged in the days that followed when management reiterated to the analyst community that the mistake was purely due to inventory drawdowns and not fundamentals or underlying demand. But the potential appointment of RFK Jr. has created a great deal of uncertainty for Eli Lilly and the pharmaceutical sector as a whole. Last week we highlighted RFK Jr.'s criticisms of obesity drugs, with his two main themes being price and his view that changes to diet and food systems are the best way to address high rates of obesity. Sure, price may become a bigger issue in the future, but you can't debate the science and the drug's ability to treat obesity and other conditions. The recent correction in Eli Lilly has the stock trading slightly above 30 times the FactSet consensus 2025 adjusted earnings per share estimate of $22.52. Looking ahead to 2026, Lilly stock is trading at about 24x. While these multiples are a premium to other drug stocks, we think it's cheap considering the company's top-tier growth that will continue as GLP-1 supply capacity catches up to demand. Another thing to note is that Eli Lilly doesn't face any major patent cliffs or IRA price exposure for the rest of the decade. (Jim Cramer's Charitable Trust is long DHR, LLY. See here for a full list of 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 fund'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 INVESTMENT 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 THE RECEIPT OF ANY INFORMATION PROVIDED IN RELATION TO THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR BENEFITS ARE GUARANTEED.
