Issues
U.S. stocks struggle a bit to regain momentum as Hong Kong’s Hang Seng and China’s Shanghai Composite contract. Investors seem to be taking a close look at valuations as markets from Japan to Europe trade at lower valuations. The big $3.5 trillion spending bill is spooking U.S. markets and splitting U.S. Senators. Today our new recommendation is a play on the aging baby boomer generation, which will increasingly require more medical attention.
A continued mixed bag of signals from Greentech still yields some good stocks to profit with. We’ve been muddling through “two steps forward and one step back” kind of action, which means today’s market may seem bad, but the bigger picture keeps improving. The key is to continue to be diligent about avoiding weak stocks and search for good fundamental underpinnings to chart moves with the strong ones. The market is slowly laying the groundwork for the next leg of Greentech’s bull move.
This issue, we’re returning to a segment of Greentech that was red hot for a brief period before simple bad luck turned investors against it for years. The sector recently broke through long-held resistance. That’s a plus. Our featured stock has a monopoly on parts of its market. It’s nicely priced for its existing business already, but its shift into next-generation technology suggests huge opportunities ahead – that’s a big plus.
We also have newly recommended ratings, suggested buy ranges for a couple, and updated sell-stops for many of our current portfolio holdings. We also now have “sell” call on one holding which has broken through support.
Read through for more details.
This issue, we’re returning to a segment of Greentech that was red hot for a brief period before simple bad luck turned investors against it for years. The sector recently broke through long-held resistance. That’s a plus. Our featured stock has a monopoly on parts of its market. It’s nicely priced for its existing business already, but its shift into next-generation technology suggests huge opportunities ahead – that’s a big plus.
We also have newly recommended ratings, suggested buy ranges for a couple, and updated sell-stops for many of our current portfolio holdings. We also now have “sell” call on one holding which has broken through support.
Read through for more details.
Last week all the major indices took a small step back. The S&P 500 lost
1.69%, the Dow fell 2.15%, and the Nasdaq declined 1.61%.
The headlines say the 5-day pullback was the largest for the S&P 500 since February. But considering that the streak of over 230 days without a 5% pullback is still in play, the short-term bearish stretch last week was minimal.
And even with the slight pullback last week, my sentiment has not changed. I remain
“cautiously optimistic” until I see market action that changes my mind.
Of course, if we see further continuation of the recent bearish trend, I might begin to shift my outlook. But a week doesn’t make a trend, and again we must remember we are only a few percentage points from all-time highs.
1.69%, the Dow fell 2.15%, and the Nasdaq declined 1.61%.
The headlines say the 5-day pullback was the largest for the S&P 500 since February. But considering that the streak of over 230 days without a 5% pullback is still in play, the short-term bearish stretch last week was minimal.
And even with the slight pullback last week, my sentiment has not changed. I remain
“cautiously optimistic” until I see market action that changes my mind.
Of course, if we see further continuation of the recent bearish trend, I might begin to shift my outlook. But a week doesn’t make a trend, and again we must remember we are only a few percentage points from all-time highs.
The bull market remains intact, so I continue to recommend that you be heavily invested in stocks that help achieve your investing goals.
Today’s featured stock is a small company that’s growing fast and that has huge growth potential as the market for intelligent vision systems booms.
As for the current portfolio, most of our stocks look good, and many are hitting new highs, but I have two sells, Supreme Brands (SPB) and Trulieve (TCNNF).
Details inside.
Today’s featured stock is a small company that’s growing fast and that has huge growth potential as the market for intelligent vision systems booms.
As for the current portfolio, most of our stocks look good, and many are hitting new highs, but I have two sells, Supreme Brands (SPB) and Trulieve (TCNNF).
Details inside.
Current Market OutlookDuring the last couple of weeks of August, more stocks, sectors and indexes were getting in gear, which was a change from the past few months of whippy crosscurrents. But as September has progressed, it looks like we’re still in the same overall environment—growth stocks, indexes and funds have again taken hits while some cyclical/value areas have perked up. That’s not necessarily a negative (at least to this point); as we wrote last week, some retrenchment among extended growth stocks was half-expected, and even if it wasn’t, the action is more a confirmation that the choppy environment is still intact, not that the sellers are truly taking control. Long story short, we’re still sticking with the same game plan as the evidence remains unchanged—we’re more bullish than not, but booking partial profits into strength, raising stops as things head higher and aiming to enter on dips is the right way to go.
This week’s list is lighter on growth stocks than in recent weeks, reflecting some of the dents they’re taking, but there are many other names that look to be resuming their advances. Our Top Pick is Antero Resources (AR), which looks like the best play in the natural gas space. Aim to enter on dips.
| Stock Name | Price | ||
|---|---|---|---|
| Antero Resources (AR) | 17 | ||
| Celsius Holdings (CELH) | 87 | ||
| DOCN (DOCN) | 76 | ||
| ICU Medical (ICUI) | 240 | ||
| Innovative Industrial Properties (IIPR) | 228 | ||
| MongoDB (MDB) | 485 | ||
| Pure Storage (PSTG) | 26 | ||
| SBLK (SBLK) | 24 | ||
| Teck Resources Limited (TECK) | 25 | ||
| Varonis Systems (VRNS) | 68 |
Growth stocks have gotten off a bit of a sour start in September, with a couple of leaders cracking near-term support and a few collapsing completely. That tells us the tricky environment remains in effect ... and yet, we don’t think the action is bad at all. Indeed, most growth stocks remain in good shape, and frankly a further pullback should offer up some high-odds entry points.
Tonight, though, we’re standing pat with our 32% cash position after selling one stock earlier this week.
Tonight, though, we’re standing pat with our 32% cash position after selling one stock earlier this week.
Markets are facing end-of-the-summer doldrums as concerns about job and Covid growth dampen enthusiasm. We move two stocks from buy to hold, while on the positive side, Cloudflare (NET) shares are up 73% this year and Novonix (NVNXF) shares are up 58% in the last 10 days of trading. Today we have a new semiconductor-related idea for you in an area usually overlooked by investors.
Here is your September Wall Street’s Best Digest, issue 845.
Thank you to all who attended our Cabot Wealth Summit last month. It was an information-packed few days, with lots of new ideas shared by all of our analysts. We hope next year we can resume our in-person meetings, as we miss seeing you!
Despite COVID’s resurgence, the markets are holding up surprisingly well. The economy is still strong, housing is robust, but businesses need employees. The unemployment rate for August fell to 5.2%, but new jobs added were much less than anticipated. Once those numbers improve, and COVID recedes, we should be in for an even stronger economy. And that’s great news for the markets!
In this issue, our Spotlight Stock revisits an old favorite of mine—a net-lease REIT that has boosted its dividend for 31 consecutive years! In my Feature article, I discuss all the reasons why this stock has been a perennial winner.
In our Growth section, you’ll find a lot of familiar names, including companies in the retail, hospitality, and communications realms, as well as a couple of newer ones in the fast food franchising, and electric vehicle charging arenas. There are a lot of great names to choose from in Growth & Income, including many industrial-related companies, as well as a home products and chemical manufacturer.
Our Financial offerings include a bank and a money exchange company. And in Healthcare, you’ll find options in biopharma, equipment, and 3-D. And speaking of 3-D, our contributors for technology stocks include one of those companies, as well as a semiconductor, cloud, and two payments businesses.
Resources, Energy, and Utilities continue to be popular fields, as our advisors offer several utilities and midstream energy companies here. Our Low-Priced Stocks are in two relatively new arenas—carbon credits and lab-grown gems. And in Preferred Stocks, High Yield, & REITs, you’ll find a couple of investment/capital corporations.
Lastly, our Funds & ETFs provide a variety of ideas, including cryptocurrency, consumer staples, alternative energy, and water sustainability.
Don’t forget to tune into my monthly Platinum Club webinars. Our October program is scheduled for October 6, at 2pm Eastern. And as always, please don’t hesitate to email me with your feedback and questions. My address is nancy@cabotwealth.com.
Thank you to all who attended our Cabot Wealth Summit last month. It was an information-packed few days, with lots of new ideas shared by all of our analysts. We hope next year we can resume our in-person meetings, as we miss seeing you!
Despite COVID’s resurgence, the markets are holding up surprisingly well. The economy is still strong, housing is robust, but businesses need employees. The unemployment rate for August fell to 5.2%, but new jobs added were much less than anticipated. Once those numbers improve, and COVID recedes, we should be in for an even stronger economy. And that’s great news for the markets!
In this issue, our Spotlight Stock revisits an old favorite of mine—a net-lease REIT that has boosted its dividend for 31 consecutive years! In my Feature article, I discuss all the reasons why this stock has been a perennial winner.
In our Growth section, you’ll find a lot of familiar names, including companies in the retail, hospitality, and communications realms, as well as a couple of newer ones in the fast food franchising, and electric vehicle charging arenas. There are a lot of great names to choose from in Growth & Income, including many industrial-related companies, as well as a home products and chemical manufacturer.
Our Financial offerings include a bank and a money exchange company. And in Healthcare, you’ll find options in biopharma, equipment, and 3-D. And speaking of 3-D, our contributors for technology stocks include one of those companies, as well as a semiconductor, cloud, and two payments businesses.
Resources, Energy, and Utilities continue to be popular fields, as our advisors offer several utilities and midstream energy companies here. Our Low-Priced Stocks are in two relatively new arenas—carbon credits and lab-grown gems. And in Preferred Stocks, High Yield, & REITs, you’ll find a couple of investment/capital corporations.
Lastly, our Funds & ETFs provide a variety of ideas, including cryptocurrency, consumer staples, alternative energy, and water sustainability.
Don’t forget to tune into my monthly Platinum Club webinars. Our October program is scheduled for October 6, at 2pm Eastern. And as always, please don’t hesitate to email me with your feedback and questions. My address is nancy@cabotwealth.com.
Ahead of the long holiday weekend, it was a mixed bag last week as the S&P 500 rose 0.58%, the Dow lost 0.25%, and the Nasdaq climbed 1.55%.
This week traders will keep a close eye on inflation as the Labor Department releases its August index of U.S. wholesale prices, otherwise known as the producer price index. The market is estimating an increase of 0.5%, after 1% increases in June and July. July witnessed a 7.8% increase year over year, which was the largest bump in over a decade. Another spike would not bode well for the overall market, so I will be keeping an eye on the release and its impact on price action.
With that in mind, and always an eye on diversification, this week’s pick is a steel and iron enterprise company.
This week traders will keep a close eye on inflation as the Labor Department releases its August index of U.S. wholesale prices, otherwise known as the producer price index. The market is estimating an increase of 0.5%, after 1% increases in June and July. July witnessed a 7.8% increase year over year, which was the largest bump in over a decade. Another spike would not bode well for the overall market, so I will be keeping an eye on the release and its impact on price action.
With that in mind, and always an eye on diversification, this week’s pick is a steel and iron enterprise company.
Today, we are recommending a small Canadian specialty pharma company that checks all the boxes of what we typically look for:
All the details are inside this month’s Issue. Enjoy!
- High insider ownership (insiders own ~41% of shares outstanding)
- Recent insider buying (insiders bought as recently as August 21)
- Strong momentum (stock is near 52 week high)
- Low valuation (P/E of 5.2x)
- Low share count (only 26MM shares outstanding)
- Strong revenue growth potential (promising pipeline)
- No debt (29% of market cap is in cash)
All the details are inside this month’s Issue. Enjoy!
Updates
The Federal Reserve is expected to lower interest rates this week, with a likely announcement on July 31. The stock market has fully priced in a rate reduction, which means if the Fed fails to lower rates, investors can expect the market to fall for a few days.
Our portfolio is outperforming the index by roughly 100%, on average. But we’re not the only ones. Many targeted mutual funds are also demolishing the Russell 2000 Small Cap Index.
Remain bullish, but continue to take things on a stock-by-stock basis. Some potholes based on earnings, rotation and news flow are certainly possible, but overall, the bull market is in good shape and most leading stocks act well.
It’s the middle of the summer swoon. But there’s a lot going on in the market, namely earnings. Overall, this earnings season is shaping up to be positive but uninspired.
Last week’s economic reports delivered good news, presuming that you are rooting for a stable or strong U.S. economy. June retail sales rose 0.4% vs. May, when economists expected an 0.2% increase; and retail sales also rose 3.4% vs. a year ago.
This week marks the beginning of the second-quarter earnings season. I don’t foresee any major changes in the trends in any of our companies, but stock price reactions and trends don’t always line up in the short term.
Our emerging markets (EEM) signal continues to be positive and right on top of its 20-day moving average as China and other emerging markets are bumping along and lacking a decisive uptrend.
Alerts
Shares of this stock are bucking the downtrend early on Monday after management announced late last week that it would take steps to cut an additional $30 million in costs by reducing the workforce by roughly 90 employees across sales, marketing, general/administrative and R&D departments.
Like many countries, Singapore is struggling with the impact of the coronavirus. But given that it is a city-state of 6 million people with a well-organized, effective government, it is well positioned to cope with all of this better than most.
William Blair recently initiated coverage on this government contractor, with an ‘Outperform’ rating.
This preferred issue has a nice yield and is backed by a large North American insurance carrier.
The shares of this video game maker were just initiated at Wells Fargo with an ‘Overweight’ rating.
The shares of this chipmaker were recently upgraded by B o A Securities, to ‘Buy’.
This accounting solutions company is forecasted to grow at an annual rate of 50% over the next five years.
As I mentioned in yesterday’s issue, we got some bad news on this portfolio stock before the market opened regarding an internal investigation of fraud by the company’s COO and several other employees who apparently significantly overstated sales in 2019.
The majority of this insurance company’s analysts rate its shares a ‘Buy.’
The shares of this China stock fell sharply today after the company announced that it had suspended the CFO and several employees reporting to him for misconduct related to “fabricated transactions.”
The top five holdings of this fund are Acceleron Pharma Inc (XLRN, 4.02% of assets), Momenta Pharmaceuticals Inc (MNTA, 3.99%), Ultragenyx Pharmaceutical Inc (RARE, 3.10%), Regeneron Pharmaceuticals Inc (REGN, 2.79%), and United Therapeutics Corp (UTHR, 2.71%).
This tech company just added another big collaboration, striking a deal with NVIDIA, to use its UE emulation (UEE) to test NVIDIA’s 5G software solutions.
Portfolios
Strategy
Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.