We are entering what could be the slowest week of the year for the earnings calendar.

However, that can’t be said for the macro front, as it will be an eventful week headlined by the Bureau of Labor Statistics’ release of the November Consumer Price Index. Investors will not only be hyper-focused on the headline inflation index but also the FOMC announcement and subsequent press conference with Fed Chair Jerome Powell on Wednesday.

Once again, the sellers stepped in last week and at least in the short term dented the bulls’ optimism. By week’s end the S&P 500 had fallen 3.35%, the Dow had lost 2.71%, and the Nasdaq had declined by 3.57%.

Once again, the sellers stepped in last week and at least in the short term dented the bulls’ optimism. By week’s end the S&P 500 had fallen 3.35%, the Dow had lost 2.71%, and the Nasdaq had declined by 3.57%.

The good news is that it seems that the markets are back on track, although we remain cautious.

Economic statistics continue to be strong, with factory orders and consumer confidence better than analysts expected. Home prices have moderated somewhat, although interest rates and the continuing lack of inventory are not helping that market.

Starting next week, you will receive your Cabot Undervalued Stocks Advisor issues and updates on Tuesdays instead of Wednesdays. So look for next week’s update in your email inbox a day earlier, on Tuesday, December 13.

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While we are not market or economic forecasters, we try to make sense of what is going on. As we’ve commented on in earlier notes, we may be seeing the return of the long-forgotten inventory cycle. If we’re right, this is the time to buy over-discounted and reasonably healthy cyclicals like the ones on our recommended list.

Our letter comments on Big Lots (BIG) earnings, our price target reduction to 25, and why it remains a Hold rather than a Sell.

After a negative start to the week last Monday, the market surged higher on Wednesday, following what many traders view as a “less hawkish” speech by Federal Reserve Chairman Jerome Powell.

All in all, the evidence has continued to show some marginal improvement in recent weeks among individual stocks, plus, some top-down measures (long-term trend, health of the broad market) are looking better … but not quite enough for green lights. All in all, what we’re seeing are steps in the right direction—the market and many individual stocks are doing what they have to in order to repair the damage. But we still need to see continued progress to really extend our line, as little is being sustained on the upside. We’ll again keep our Market Monitor at a level 5.

This week’s list is a hodgepodge of names from different sectors and in different positions in their charts. Our Top Pick is a biotech name that, after many stops and starts, looks to have finally broken out on the upside.

The market continues to improve, so we’re only adding – not subtracting – to the Stock of the Week portfolio again today. Our latest addition is a very recognizable technology name that was once a market darling but has fallen on hard times in recent years. Now it’s starting to show signs of life again, and our Bruce Kaser thinks it’s a prime turnaround candidate. Perhaps it will make like another big turnaround story in our portfolio that’s hitting new all-time highs today…

There really isn’t much to say at this juncture. All of our positions are in good shape at the moment and my goal, as stated last week, is to add a few short-term positions to the mix. I’ve been hesitant to add short-term positions over the past few months due to the ongoing market environment, but if we could see a slight pullback this week, I think we might just be in business for a few new trades. Here’s hoping!

We are officially in the earnings doldrums, but that certainly doesn’t mean that opportunities won’t present themselves. For instance, this week Costco (COST) announces earnings after the close Thursday and offers a decent opportunity for an iron condor and potentially another candidate for a short strangle.

We locked in another winning trade last week. Our IWM iron condor had pushed to $0.24 so we decided to lock in over 50% of the original premium sold for an 11.4% return. The trade marked the 15th out of 16 winning trades for the service since we started Quant Trader back in June. If all goes well this week, we should be able to add to our winners by locking in our December bear call spread.

After a negative start to the week last Monday, the market surged higher on Wednesday, following what many traders view as a “less hawkish” speech by Federal Reserve Chairman Jerome Powell.

In most professional and personal endeavors, there are dozens if not hundreds of decisions to make. Manage a tech company? You need to decide who to hire/promote/fire, what responsibilities to give them, how much to pay them (base and bonus), resolve conflicting agendas, decide what products to promote, approve technical and strategic changes to each product or service, check quality control, help customers, set pricing … the list is essentially endless. Even a simple home landscaping project involves a long list of decisions: how much to spend, do it yourself or hire out, what to plant and where, and so on.

The market continues to be strong with the S&P 500 near all-time highs. And micro-caps continue to chug along. In aggregate, our micro-cap recommendations continue to do quite well, and I continue to find many excellent opportunities, especially in “cyclical” areas of the market. Before we get into this week’s update, I wanted to spend some time sharing my perspective on stop-losses as I get questions on them quite often. In general, stop-losses are not a viable option for micro-cap stocks.

It’s a period of offsets for the market. The excitement of a booming recovery is offset by the fact that the market is looking six months ahead to the end of the year when growth is slowing.

Have we already reached “peak” inflation? That’s a question that investors are asking after recent economic headlines suggest some of the factors which led to higher metal prices (and other commodities) may be abating.

Today’s note includes the Signet Jewelers’ (SIG) earnings update and our price target increase, as well as our ratings changes from this past Monday, and the podcast.

The market has been doing OK, though it’s more about addition by subtraction—the fact that growth stocks have avoided any major selling wave after the recent upmove is a plus, but we’re still seeing lots of selling on strength and rotational action that changes by the day.

Small caps and growth stocks continue to look better for the third consecutive week. This is a welcome trend given that the beginning of May was pretty tough.

The overall market has topped out in the last month. But many of the slower-moving and more value-oriented stocks didn’t get the memo.

The market seems to have settled into complacency. We’re in a period after first-quarter earnings reports and government statistics indicate a surging economy, yet investors rightfully wonder if or when the Fed will raise interest rates and are starting to consider what happens after the post-pandemic boom.

Today’s note includes earnings updates, ratings changes and the podcast.

The market seems to have found its footing this week as the economy reopens amidst some supply shortages and inflationary pressures. Electric vehicle stocks are coming back as Ford announced a big push into EVs and its new F-150 Lightning received 70,000 deposits in just 10 days.

The market continues to stumble sideways. On the one hand, the S&P 500 is within a whisker of the all-time high. On the other hand, stocks have been going sideways for about a month.

This mining company beat analysts’ estimates by $0.04 last quarter, earning $0.18 per share.

This lumber company reported fourth quarter earnings of $366 million on sales of $1.689 billion, and recently completed its acquisition of Norbord, Inc.

The shares of this pizza franchiser were just upgraded at RBC Capital to ‘Outperform.’

A new CEO is driving this insurance company to higher profits. The shares have a current dividend yield of 3.15%, paid semi-annually.

Three days does not make a trend in any way, shape or form. But, rejuvenated by a stalling/pullback in yields, growth stock bulls have pulled themselves up off the mat and appear ready to defend their turf – at least for now.

With so much going on in the market I wanted to share some of what’s running through my head today, then keep tomorrow’s Weekly Update focused mostly on stock updates.

Yesterday’s big rally in the Nasdaq was enough to reignite bullish spirits but it was not a clear signal that it is time back up the truck on growth stocks just yet. While I side with those who say the pullback has opened up opportunities for fresh buying in many beaten down names, I think the chances of a snapback rally in many of the highest multiple growth stocks, then a follow through to new highs within a few weeks, is unlikely.

The Dow hit a new high today, but marijuana stocks didn’t; their correction, which was richly deserved, is now one month old. And the fact is this correction is likely to run further, mainly because the broad market still needs a correction.

Trading at a P/E ratio of 9.99, this insurance stock looks undervalued. Its shares have a current dividend yield of 3.10%, paid annually.

This construction materials company beat earnings estimates by $0.20 last quarter.

This Brazilian medical education company is forecasted to grow earnings at a rate of 42.3% next year.

Suffice to say the last two weeks have been very tough. On the one hand, yes, of course some sort of correction or pullback has been expected given the huge progress the market – and growth stocks, small caps and IPOs in particular – have made over the last 12 months. But expecting something to come eventually and actually experiencing it are two entirely different things.

A few Cabot Options Trader subscribers have asked me about ways to protect gains in their portfolios, so I thought I would write to everyone with a couple of strategies using options to hedge your portfolio.

A subscriber recently asked me if I keep a journal of my trades. Many traders keep journals so they can look back at their trades and evaluate what they did right and what they did wrong.

Want to know how the big institutional investors use options? Here is an example of how one trader spent $132 million on three technology stocks.

Options trading has its own vernacular. To know how to do it, you need to know what every options term means. Here are some of the basics.

Our Cabot Momentum 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 Momentum Trader features.