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Cabot Weekly Review (Video)
In this week’s video, Tyler Laundon touches on the economic data from the past week and the puts and takes between inflation easing, the FOMC March meeting minutes and earnings expectations for Q1 and the rest of 2023. His takeaway is that earnings trends in the short-term don’t look great but with the market tending to look forward and the Fed about done with hikes there’s potential for a “bad to better” scenario to keep the market acting well and potentially moving higher. Tyler also jumps into a handful of stocks with recent news that has moved shares higher.
Stocks Discussed: IHI, IBB, SHOP, INMD, FLYW, HURN, ISEE, PINS, SWAV
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Portfolio Updates This Week
Cabot Growth Investor
Bi-weekly Issue April 6: This week’s action has been a disappointment, with growth stocks suffering selling while defensive names have picked up steam. Still, nothing much has changed--the top-down evidence is mixed, and growth stocks, while taking on water, haven’t suffered anything abnormal to this point. Thus, given that we’re about half in cash, we’re mostly standing pat in the Model Portfolio tonight.
Bi-weekly Update April 12: WHAT TO DO NOW: Continue to play things in the middle, as the on-again, off-again environment remains in place. We are seeing some improvement from our Cabot Tides and Two-Second Indicator, which is a plus, but most of the evidence is stuck in the middle, so we think having a good chunk of cash as well as a few resilient growth names makes sense. We have no changes in the Model Portfolio tonight; our cash position remains just under 50%.
Cabot Top Ten Trader
Weekly Issue April 10: After a couple of good weeks, some pullback was half-expected—and, when looking at the big-cap indexes, nothing out of the ordinary has been seen. That said, digging deeper, we saw a good amount of selling in resilient stocks, another round of selling in the broad market all while defensive names found buyers. To this point, the potential leaders that took on water are still holding onto intermediate-term support, so we’re not advising any major change in stance. That said, the next couple of weeks will be key (for good or bad), especially as earnings season gets started.
Movers & Shakers April 13: On the whole it’s been a mixed week thus far—the resilient big-cap indexes are down 1% or less in general, though some of the broader indexes are up 1% or more. All in all, though, nothing has happened (in either direction) to change our opinion that we’re still in a washing machine-type environment—there’s still plenty of mixed action, with some indexes looking good (but not really in strong uptrends) and some looking iffy; many stocks are holding support but most are still getting tossed around, and there’s lots of rotation and selling on strength (we’re even seeing that this week, with “weak” indexes up and “strong” indexes down), which is a sign big investors aren’t playing heavily.
Cabot Options Trader and Cabot Options Trader Pro
Cabot Options Trader Pro Weekly Update
Cabot Options Trader Weekly Update
Cabot Undervalued Stocks Advisor
Monthly Issue April 4: We comment on the price of gold and what we see as its primary drivers. Gold is now trading above $2,000/ounce. We also provide updates on our recommended stocks.
Weekly Update March 28: This past week, among the 1,000 largest companies by market cap, the average percentage share price change was zero. Half of the stocks had moves of no more than +/- 1%. And, only 14 stocks had share price movements of +/- 10% or greater.
Cabot Stock of the Week
Weekly Issue April 10: The market took a deep breath last week on the cusp of an eventful upcoming stretch. This week alone we get the latest CPI and PPI numbers before a very pivotal earnings season kicks off on Friday. Potential catalysts – and potholes – abound, so chances are the coming weeks won’t be as calm as the first week of April was. With that in mind, in today’s issue, we’re adding a stock fit to weather any further storms. It’s a century-old company that pays a dividend, trades at a mere 12 times forward earnings, and yet is up 14% year to date – and has been a mainstay in the portfolio of Bruce Kaser’s Cabot Undervalued Stocks Advisor.
Cabot Explorer
Bi-weekly Issue April 6: More than $15 trillion in assets are linked to the performance of the S&P 500 index in some way, according to S&P Dow Jones. Apple, at about $2.4 trillion, and Microsoft, at $2.1 trillion, are so large that, taken together, the two companies would be the third-largest sector of the index, behind tech and health care. This share is trending lower as other companies rise.
Bi-weekly Update April 13: It can pay to pay attention to what investment legends are doing to cope in these turbulent times.
Warren Buffett still has a knack for seeking value and a history of going to Japan to find it in times of volatility. Overall, Japan’s Topix index trades at 13.3 times expected earnings, according to S&P Global Market Intelligence. That compares with 18.9 times for the S&P 500.
Cabot Small-Cap Confidential
Monthly Issue April 6: We’re digging into another compelling MedTech story this month. The company in focus is a spine specialist. It’s been grabbing market share from larger players by growing a portfolio that covers the full spectrum of spine care, from imaging and surgery planning to surgical tools and implants.
Weekly Update April 13: The market is still like a jar of mixed nuts. Some good, some bad.
Earnings season begins this week as large-cap banks start delivering Q1 results. Across small-, mid- and large-cap stocks (all sectors) earnings estimates have been trending down for several quarters.
Cabot Dividend Investor
Monthly Issue April 12: So far, this has been a positive year for the market. But an enormous amount of uncertainty remains. The painful high inflation/hawkish Fed conundrum that caused last year’s bear market appears to be ending. But a high risk of recession is taking over. It will be difficult for stocks to rally into the next bull market without knowing the timing, severity, or duration of a possible recession.
Weekly Update April 5: The market was impressive last week. The S&P 500 moved 3.5% higher for the week, accounting for nearly half of the better than 7% YTD return. Hopefully the rally has further to go.
Cabot Early Opportunities
Monthly Issue March 15: In the March Issue of Cabot Early Opportunities we take a look at what’s been unfolding in the financial system and consider implications for the FOMC’s meeting and subsequent rate hike decision next week. Suffice to say, buying a bunch of stocks into the current uncertainty doesn’t seem like the best idea. We’ll add a few partial positions, but the bulk of this month’s new ideas are going on our Watch List. We’ll take things as they come and consider plucking names off this list as things develop. Never a dull moment!
Cabot Profit Booster
Weekly Issue April 11: This week, in an attempt to keep the portfolio as diversified as possible we are adding a genomics play, though we are doing so by selling an in-the-money call.
Cabot Micro-Cap Insider
Monthly Issue April 12: Today, I’m recommending a failed biotech that is undergoing a strategic review.
Key points:
· Based on conservative assumptions, I see 30% to 92% upside within 12 months.
· Low downside risk given stock market cap is 51% of net cash.
· High insider / institutional ownership assures incentives are aligned.
All the details are inside this month’s Issue. Enjoy!
Weekly Update April 5: The big news this week is that OPEC+, including Russia, made the decision on Sunday to cut oil production by 1.16MM barrels per day from May through the end of the year. It appears that OPEC+ wants to keep oil in the $80-$90/barrel range.
Cabot Income Advisor
Monthly Issue March 28: The banking situation has changed the Fed. The damage done by previous rate hikes is making the Central Bank far less hawkish. The risk is shifting from the Inflation/Fed cycle to recession. The end of this cycle may have been expedited. And stocks could rally out of this bear market sooner than thought. Of course, the banking issues might not be over yet. And the timing and severity of a possible recession is still unknown. Things may get worse in the market before they get better. For now, defensive stocks that can maintain earnings growth in a worsening economy or recession are better places to be.
Weekly Update April 11: It’s a big week. The March Consumer Price Index (CPI) report comes out on Wednesday. The number may determine the short-term course of the market.
Stocks have trended higher over the past month as the banking situation has so far tempered the Fed without any offsetting crisis. There now seems to be a greater likelihood of a recession later this year, but investors are also pricing in Fed rate cuts in the second half. That’s the dicey part.
Cabot Turnaround Letter
Monthly Issue March 29: This issue focuses exclusively on the banking industry. Given the recent turmoil and the second- and third-largest bank failures in U.S. history, we examine the question on the minds of value and contrarian investors: is it time to jump back into bank stocks? Our feature recommendation this month is First Horizon Corp (FHN), a relatively plain mid-sized regional bank that provides an appealing way to exploit the bank sell-off: merger arbitrage. Due to regulatory delays, the bank’s shares trade at a 33% discount to the $25/share all-cash offer from TD Bank Group, a large and well-capitalized Canadian bank. We believe that the deal will close at the $25 price, providing an attractive return, even as the shares’ discounted valuation offers considerable downside protection.
Weekly Update April 14: This week kicks off our earnings season, with Wells Fargo (WFC) reporting. There were no ratings changes this past week.
Cabot Money Club
Monthly Magazine April: Bonds or bond funds should be part of most investors’ portfolios or retirement plans because of the predictable income they generate. But with interest rates vacillating wildly, let’s take some time to explore how that impacts bond investors and some strategies you can employ to optimize your fixed-income returns.
Stock of the Month April 13: The broad markets have improved nicely in the past month, albeit with a recent pullback. Leading sectors were Communication Services, Consumer Staples, Healthcare, Technology, and Utilities. Style-wise, large-cap growth stocks beat their value peers, gaining 3.64% for the month.
The employment picture remains healthy, with 236,000 jobs added in March, taking the unemployment rate down to 3.5%. This was the slowest job growth in two years, so economists are hoping that will slow inflation—and the Fed’s rate hikes!
Ask the Experts
Prime Question for Jacob: Do we continue to sell positions as there are clearly issues in the banking system, or do we ignore those worries and take the lead from stocks like AAPL/AMD/NVDA/MSFT all of which are within striking distance of recent highs?
Jacob: To be honest, this is as confusing of a situation as I can remember. What I mean is I have countless candidates for new buys based on stock strength, but I could also see these banking/real estate worries leading to a test of the S&P 500 2022 lows, or worse. Or, perhaps the banks will lead this week and the mega-caps which have been working will then soften.
Quarterly Cabot Analyst Meeting
The recording of the Cabot Prime Members Meeting with the Analysts from January 18, 2023 is now available for you to listen to at your convenience—click here for access. This private call with our analysts is one of your exclusive Cabot Prime Pro member benefits.