Organic food is a nearly $50 billion-per-year industry in the U.S., comprising 6% of total food sales in 2018, and it’s growing at 6% annually. Whole Foods is the obvious, well-known chain that’s capitalizing on this trend, with Trader Joe’s being another that’s popular in certain areas of the country. Less famous, but with a bright future, is this U.S. supermarket chain specializing in natural and organic foods, focusing on fresh produce, bulk foods, vitamins and an array of household wares.

Current Market Outlook


Since the March 23 low, the market has pretty much followed the plan, with a good initial rally, a little upside follow through and lots of up/down, news-driven moves since. To be fair, that is more descriptive than predictive—a few big moves in one direction or the other could change the outlook, and today’s action was encouraging for the bulls. Right now, though, the overall evidence remains unchanged: The trend of the major indexes and most stocks is still pointed down, and while many names are doing a good job of hanging in there, few stocks are in true uptrends. Looking ahead, the first sign of light would be a batch of growth-oriented stocks bursting to new highs, followed by the intermediate-term trend of the major indexes turning up (likely to take another week even if all goes well). Given the unprecedented situation, we’re open to anything, but until the buyers show more muscle, we advise sticking with a mostly defensive stance.

The good news is that we continue to see quite a few stocks that institutions have been accumulating in recent weeks. This week’s list has a few, with our Top Pick being Livongo (LVGO), a newer, fast-growing name that’s popped up of late.

Stock Name	Price	Buy Range	Loss Limit
Five9 (FIVN)	78.35	74.5-78	66-68
Livongo Health Inc. (LVGO)	33.34	27.5-30	23-24.5
Newmont Mining (NEM)	57.31	48-51	42.5-44.5
Novavax, Inc. (NVAX)	65.95	13-14.5	10.5-11.5
Peloton (PTON)	53.03	27-29	23-24.5
Pinduoduo (PDD)	87.53	36.5-38.5	33-34
Regeneron Pharmaceuticals (REGN)	512.96	470-490	415-425
RingCentral (RNG)	238.73	213-225	187-192
Sprouts Farmers Market (SFM)	19.00	18.5-19.5	16-16.5
Zscaler (ZS)	126.22	61-64	54-55.5

The market was up big today, and a couple of our stocks hit new highs—which is impressive considering the recent crash—but the market’s major pattern is one of bottom-building, and that takes time.
In the meantime, the action of the best growth stocks gives us a clue as to developing leadership, and the best value stocks are absurdly cheap. Plus, many are paying huge dividends! That’s the case with today’s recommendation, a giant in the oil industry.


As for the rest of the portfolio, it’s acting well (with a couple of very strong stocks in the mix), and thus I have no changes today.


Full details in the issue.

After a strong rebound early in the week, markets sold off a bit over the past two days as investors battle uncertainty on the virus and economic impact fronts. We remain positive on our seven Cabot Global Stocks Explorer stocks and will put some of our 35% cash position to work today with a high quality Singapore bank many of you are familiar with. Our emerging market signal stays negative.

Also, I have a special alert regarding Luckin Coffee (LK), which is down very sharply this morning.

This month we’re looking past all the current uncertainty in the market at a profitable, young company that should hold its own during this rough patch then accelerate growth into the back half of 2020 (assuming the pandemic eases as we move into the summer months).

The company offers intelligent identity solutions for global enterprises. These solutions are strategic imperatives because they help workers do their job from anywhere and help companies streamline customer experiences.



It’s not the type of stock that’s likely to surge on expectations of an immediate surge in demand, like Zoom Video (ZM) or Teladoc (TDOC). But with 115% net revenue retention the company should grow with current clients in the near-term, then grab its fair share of new business once economic activity picks up again.



We start today with a half position given the market conditions. All the details are inside.

Today’s featured companies are benefiting from the current focus on healthcare, online commerce, dining at home and limited travel behaviors.

All of the stocks that I follow with any regularity finished falling in March, and began to rebound. I’m glad for that, and happy to be buying low. However, there’s still a dark cloud on the horizon. The longer the quarantine situation lasts in the U.S. and in foreign lands, the uglier the economic situation will become. That’s because many companies are scrambling for cash to pay their employees, rent, utilities, etc. while they’re not actually selling any products that can replenish the cash flow.



There are various stocks in today’s issue that I indicated would be good for traders. “Good for traders” bears no resemblance to “good for buy-and-hold investors”, okay? Please read my recommendations carefully. When in doubt, send me an email with your questions.



Lastly, take your time investing cash positions. Many stocks will be in trading ranges, so watch for opportunities to buy low and sell high within those ranges. To that end, I’ve listed short-term upside price resistance targets on quite a few of the stocks. When the stocks rise to those targets, you’re going to tell yourself “my stock is going to keep rising!” Instead, odds are very strong that your stock will turn down. This will be a trader’s market for much of 2020. If you’ve ever toyed with the idea of buying and selling within a stock’s trading range, this is the year to do it! Best of luck to you!

With consumers focused on social distancing and lockdowns to help prevent the spread of the coronavirus, many restaurants have no revenues, while others are generating a little income through delivery and pick-up. Yet, despite this uncertain outlook, the crisis will eventually subside.

In this issue, we highlight six restaurant companies with both the survivability and price discount traits.

With COVID-19, plunging oil prices, credit/health worries and central bank printing, it’s a time of maximum uncertainty—and such uncertainty plays right into the hands of gold, which has popped back toward multi-year highs. The world’s second-largest gold mining company, is well positioned to benefit from this strength.

Current Market Outlook


There are no sure things, especially in this unprecedented environment, but we think it’s a decent bet that last Monday represents a workable low in the indexes, bolstered by short-term positive divergences in the broad market and some encouraging snapback action among a good number of growth stocks. Given that the evidence is slightly better, we’re open to some nibbles here or there, especially among the stocks that have shown strong signs of accumulation. That said, we still believe it’s best to be mostly defensive—the intermediate-term trend remains strongly down, and even if a bottoming process has begun, the odds favor a volatile, news-driven few weeks (and, of course, there’s always the chance stocks break their lows down the road). Long story short, the rain has stopped for now, but the overall storm system hasn’t yet moved out to sea.

Encouragingly, for the second straight week, Top Ten is finding a lot of growth-oriented stocks that are showing peppy action. Our Top Pick is Seattle Genetics (SGEN), which has a nice four-month launching pad and isn’t far from new highs.

Stock Name	Price	Buy Range	Loss Limit
Atlassian (TEAM)	182.16	139-144	126-128
Barrick Gold (GOLD)	27.20	18-19.5	15.5-16.5
Dexcom (DXCM)	421.36	257-273	228-233
GDS Holdings Limited (GDS)	80.15	55-58	49-51
Netflix, Inc. (NFLX)	423.92	355-375	320-330
NVIDIA Corporation (NVDA)	242.42	250-270	220-226
Okta, Inc. (OKTA)	148.41	118-126	106-108
Quidel Corp. (QDEL)	93.49	91-95	80-84
Seattle Genetics (SGEN)	150.85	110-116	97-100
Slack (WORK)	24.12	26-27.5	21.5-22.5

As the market gets back on its feet after the recent 33% drawdown, all Cabot analysts are looking for opportunities—with the growth-oriented analysts looking for strength and the value-oriented analysts looking for value—and it’s value that describes today’s featured stock perfectly. A well-known pharmaceutical giant, the stock is a bargain today.

Pull in your horns a bit. In last night’s Special Bulletin, we cut our loss in Kate Spade and moved our Five Below and Sabre to Hold. Our Cabot Tides are now on the fence, though our Cabot Trend Lines and Two-Second Indicator remain positive. We now have 30% cash in the Model Portfolio, with our next move depending on whether the major indexes can hold support.

Cabot’s intermediate-term market timing indicators are now on the fence, and I recommend holding off on significant new buying for now, unless you’re substantially underinvested. We’re not selling anything today, but I am putting Xcel Energy (XEL) on Hold.

A couple of weeks ago, I bought Kraft Heinz (KHC), and caught the early-May run-up. And if I were buying a stock today, I’d go straight to Adobe Systems (ADBE) because it appears ready to climb, just like KHC did.

Nine Cabot Benjamin Graham Value Investor companies reported quarterly financial results or other noteworthy news. I also include some interesting questions from subscribers with my responses.

We had four companies report earnings this week and I’ve already updated you on three of them through Special Bulletins. A review of the fourth, as well as incremental updates on our other positions, is provided in today’s Update. Overall, my stance is still cautiously optimistic.

The Cabot Emerging Markets Timer is flashing a warning signal, and even good earnings results are no guarantee of big advances. We are trimming the portfolio by selling Sibanye Gold and dropping YY Inc.

Most of our portfolio holdings are acting similarly healthy, and if you feel underinvested, you can add positions judiciously here. I’m switching Smucker (SJM) back to Buy today based on the solid technical support the stock demonstrated over the past week.

In this update, we take a look at recent news and earnings reports from our portfolio stocks, and raise the ratings on Boise Cascade (BCC), Delta Air Lines (DAL) and D.R. Horton (DHI) to Buy.

Sixteen Cabot Benjamin Graham Value Investor companies reported quarterly financial results. Four produced outstanding sales and earnings: AMC Networks, IntercontinentalExchange, Priceline and Scripps Networks, and four reported rather weak results: Maiden Holdings, McKesson, Prudential and WestJet Airlines. I will review all of the quarterly reports soon and offer sell recommendations if necessary.

Stand pat. The market has been pulling back for the past two weeks, but our market timing indicators are still bullish and most of our stocks are acting well. That said, there’s not enough evidence for us to put more money to work, so except for two small changes (we’re switching Sabre (SABR) to a Hold rating and putting Facebook (FB) back on Buy), we’ll keep our seven stocks (and a cash position of 30%) and watch how things unfold.

We’re switching Target (TGT) and ConEd (ED) from Buy to Hold today. The rest of our ratings remain unchanged.

We had three stocks report this week. Two of them, LogMeIn (LOGM) and Mitek (MITK), are surging higher. There are no ratings changes today. Next week, we’ll hear from NanoString (NSTG) and Primo Water (PRMW). Overall, my stance remains cautiously optimistic.

Five analysts have increased their EPS forecasts in the past 30 days, for our first recommendation, a lending company.

Two analysts have increased their EPS forecasts for this mining company in the past 30 days and RBC Capital has recently upgraded its shares to ‘Outperform’.

Berenberg and Raymond James also like this medical device company, boosting its ratings to ‘Buy’ and ‘Outperform’, respectively.

Wall Street is raising its earnings estimates for this cloud company after its $0.04 earnings beat for its latest quarter.

This tech company beat analysts’ earnings estimates by $0.37 last quarter.

Coverage of the shares of this insurance company was just initiated at Credit Suisse with an ‘Outperform’ rating.

The top five holdings of this fund are: Amazon.com Inc (AMZN, 23.60% of assets); The Home Depot Inc (HD, 7.51%); Walt Disney Co (DIS, 5.57%); Comcast Corp Class A (CMCSA, 5.42%); and Netflix Inc (NFLX, 4.84%).

Change out an international fund for a worldwide fund.

Here’s a recommendation to change out an international fund for a worldwide fund, in which the majority of assets are invested in the United States.

This human resources solutions provider beat analysts’ earnings estimates by $0.20 last quarter.

This is an unscheduled interim update to let you know that the next full issue of Cabot’s 10 Best Marijuana Stocks will be published Thursday, August 30.

One of the stocks in our portfolio popped after it reported Q1 earnings but, for the most part, has been trending down since.

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.