Today, we are recommending a special situation. The stock is a closed-end fund that is in the process of transitioning to a real estate investment trust (REIT). Once the transition is complete, the universe of investors that can buy the stock will double, driving indiscriminate buying pressure. Other key points:

• Trades at a 40% discount to NAV.
• High insider ownership (CEO owns 14% of company).
• Relentless insider buying.

All the details are inside this month’s Issue. Enjoy!

This week I’m adding an energy stock engaged in hydrocarbon exploration, Marathon Oil (MRO).

Does your ETF portfolio look the same this year as it did in 2021, or even for the past five or 10 years?

With this first issue of the Cabot ETF Strategist, you’ll get the essential portfolio allocations to get the year started right. Whether you’re an aggressive, moderate or conservative investor, theres’s a portfolio for you.



Both equities and fixed-income asset classes are getting a slow start to the year. That’s good news for anyone rebalancing or reinvesting their portfolio, as you can buy ETFs at potentially lower valuations.

Note: Because of the Martin Luther King, Jr., holiday, next week’s issue will be published on Tuesday, January 18.



While the S&P 500 hit a record high just last week, the market is being hit hard today, and thus I have two sell recommendations, AMBA and FND.



But I also have a new recommendation, which has the potential to be a big winner as the world increasingly values what this little company produces.



Details inside.

Happy New Year to everyone - I wish you and your families a healthy and prosperous New Year. As we turn the page to 2022, let’s review some trends before getting to a company with a new device to shake up and lower costs in healthcare at home and around the world.

The market is a bit of a mess, but the selloff has created opportunities to pick up shares in high-growth small- cap names at what seems like extremely attractive prices.





Today’s recommendation is one of those names. It’s a marketplace company that is revolutionizing the outdated industrial manufacturing industry.





While the stock hasn’t been immune to bouts of market volatility it has been far more stable lately than most other high-growth names. It’s up over the last three weeks! And it offers investors exposure to an industry that is seen rebounding in 2022 and 2023.





Enjoy!

A new year brings a fresh perspective. Flows into U.S. ESG funds rose 20% in 2021 and doubled worldwide. Some $3.9 trillion is now dedicated to environmental, social and governance issues globally, primarily in equities. All that money sees the long-term trend of Greentech continuing upward, driven by the desire to combat climate change and the universe of innovation it has inspired.



This issue we feature two selections. For the Real Money Portfolio, we focus on an upcycler benefitting from strong construction activity. For the Excelsior portfolio, we offer a high-risk, high-reward player in hydrogen.

Thank you for subscribing to the Cabot Undervalued Stocks Advisor. We hope you enjoy reading the January 2022 issue.



We comment on the abrupt shift in market sentiment that has boosted the prices of our undervalued stocks relative to expensive hyper-growth stocks. Several of our left-for-dead stocks, like Arcos Dorados (ARCO), which jumped 17% in the past two weeks, have suddenly been rediscovered by the market. Others, like Coca-Cola (KO) and Sensata Technologies (ST), are reaching new all-time highs as investors find that their healthy fundamentals haven’t been fully reflected in their share prices.



This shift may not last, and is only two weeks or so in the making. But it reinforces our view that, to quote Warren Buffett, “in the short run, the market is a voting mechanism, but in the long run it is a weighing mechanism.”



Please feel free to send me your questions and comments. This newsletter is written for you and the best way to get more out of the letter is to let me know what you are looking for.



I’m best reachable at Bruce@CabotWealth.com. I’ll do my best to respond as quickly as possible.

This week I’m adding American worldwide manufacturing services company Jabil (JBL) to the portfolio.

Since 1928, the Santa Claus rally has been positive 79% of the time. For this year, the stock market is shaping up to post the best Santa Claus Rally returns since 2000-2001, when the S&P 500 rose 5.7%.

The term was coined by Yale Hirsch, the founder of the Stock Trader’s Almanac, and one of my contributors to my Wall Street’s Best Digest newsletter. The definition: the markets tend to rise over a stretch of time right before and after the calendar flips to the new year. Specifically, the rally involves the last five trading sessions of the year and the first two of the new year.



And that’s really good news! With the pandemic and the omicron variant still weighing on us, any good news is heartily welcomed! But that’s not all that is glittering this holiday season. Home prices, while still rising, are certainly moderating, which should continue to keep the housing market strong. And, indeed, you can see the strength by the uptick in both existing homes (6.46 million) and new home sales (744,000).



Also, durable goods sales are up, and jobless claims have declined.



I’d say that’s a great start to the new year! We are still bullish, with a dose of caution, so stock picking continues to be of critical importance in growing and maintaining your portfolio.



This month, I’m going with another Real Estate Investment Trust, which pays a hefty dividend to add to your cash flow.



Please let me know if you have any questions; I always look forward to your emails.



Happy Investing!

As we enter the brand-new year, we have a renewed buy signal from our intermediate-term timing indicator, and the best stocks are hitting new highs—including a lot in our portfolio. But one of ours is a true laggard, and will be sold today.




As for the new addition, it’s a hot growth stock favored by Mike Cintolo, which is seeing great growth in the exciting area of networking at the edge of the cloud.




Details inside.

There have been some positive baby steps since the market’s early-December low, but there remain many yellow flags, too, such as the fact that growth-oriented funds and indexes remain iffy at best. All in all, we’re a smidge more constructive than we were a couple of weeks ago, but we don’t advise making any big commitments until we see more individual names let loose on the upside.

This week’s list is heavier on cyclical names, as those have been holding up (some even advancing) much better than the growth areas of the market. Our Top Pick is a shipping name that’s posting huge numbers and is near new highs.

We are so accustomed to looking at stocks and markets day by day that we sometimes miss the big trends as well as opportunities.

Two stocks depart from the Special Situation Portfolio and the Growth Portfolio today, respectively, while another joins the Growth & Income Portfolio.

The upward trajectory for growth stocks that was smooth sailing in November has turned far bumpier in December.

Remain bullish, while keep your eyes open as some stocks have hit potholes. The market itself is in good shape, though we continue to think some news-driven ups and downs are likely in the near term.

Here we are within weeks of the end of year and the end of a decade. It is approaching the 11th year of the recovery and bull market. The S&P 500 is up 25% in 2019 and very near the all-time high. Where do we go from here?

A high percentage of stocks that I follow are exhibiting bullish price charts right now. Obviously, you already knew that the stock market has been acting well. I simply want to reiterate that the recent bullishness appears to be sustainable. Enjoy!

This has been a good year for the market. With only weeks left in 2019, the S&P 500 is more than 23% higher for the year. Some of that is the undoing of the overselling at the end of last year. But the market has trended consistently higher all year and is close to the all-time high.

Remain bullish. The market and leading stocks continue to act well, and while a pullback, shakeout or some other potholes could occur in the short-term, the odds continue to favor higher prices over time.

Tomorrow is the expiration of May options, and it’s been a spectacular month for our covered call strategy.

This agricultural equipment company is forecasted to grow 35% next year.

As coronavirus matters continue to dominate the headlines and the world works toward slowly reopening, the action of marijuana stocks continues to impress—and with good reason.

Tyler is locking in profits on three stocks.

This health-care data stock reported after the close yesterday with results that beat lowered expectations.

GM reported earnings that beat analysts’ estimates.

Crista updates us on two stocks, one in the portfolio and one that she has recommended in the past year.

This portfolio stock reported earnings and moves to Buy.

Long-term care facilities have taken a hit due to coronavirus, but this Canadian company looks like it’s going to be fine.

This Cabot Micro-Cap Insider recommendation moves to Hold.

Two portfolio stocks reported earnings and have rating changes.

This preferred stock is backed by a Silicon Valley bank that provides services to companies in the technology corridor.

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 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.