The rescheduling waiting game continues. The good news is we continue to get signals from cannabis company CEOs like Boris Jordan at Curaleaf (CURLF) and sources in Washington, D.C. that the cannabis sector reform is on track to happen “relatively soon.”

What’s the hang-up? Most likely Department of Justice lawyers want to bulletproof rescheduling against the inevitable legal challenges by cannabis reform opponents.

This was a difficult week for stocks as uncertainty about how the Middle East will evolve caused investors to pause until the situation stabilizes. All signs point to an enlargement of the conflict, so caution is recommended.

Gold has lost some of its luster as prices are now back about to where they were at the start of the year. Artificial intelligence stocks have fallen sharply as well, and some are even trading at a discount suddenly. One of the biggest names in AI looks like a serious bargain, and that’s our featured recommendation for today.

Details inside.

In the March issue of Cabot Early Opportunities, I feature three high-conviction plays on the Electrification of Everything and global energy themes. We dig into an aerospace leader that’s repurposing aircraft engines to power AI data centers, a premier infrastructure contractor building the physical backbone of the U.S. electrical grid, and the undisputed leader in subsea energy infrastructure.

All the details are inside this month’s issue.

Enjoy!

J.M. Smucker is a name that needs no introduction; the hybrid consumer staples/discretionary company makes a bevy of well-known food and beverage items commonly sold at grocery and convenience stores throughout North America.

It’s also fairly common knowledge that the company is a Dividend Aristocrat, that is, an S&P 500 company that has consecutively increased its dividend payouts for at least 25 years.

It’s been a tough market. The S&P has moved lower for four consecutive weeks. Uncertainty regarding the Iran war and oil prices is dragging stocks lower. The war could end tomorrow or drag on for another month or longer.

Today could be a great buying opportunity. But the turmoil could also drag on. It’s tough to buy stocks in this uncertainty. Fortunately, there is a way to benefit if the market takes off, but without adding any risk.

Eli Lilly (LLY) has been one of the most successful large stocks on the market in recent years. A covered call was sold on LLY when it was selling near the high before the Iran war. But the stock price has since fallen. The covered calls that were sold at $60 per call are now selling under $4. You can buy back the calls and gain upside exposure for just a small fraction of the sale price and a mere blip in the returns of the high call premium.

It’s worth gaining the upside exposure. The war could end this week, and stock prices could soar. Beyond that, there is a huge FDA decision coming in April. The FDA will decide on approval for Lilly’s potentially game-changing oral weight-loss drug. It could offer big upside for the stock.

Before we dive into this week’s covered call idea, we need to sell our stock positions coming out of March expiration as the calls we sold expired worthless, leaving us with the stock positions.

The market had a welcome bounce today after a hairy end to last week, which is certainly encouraging and comes with some other positives we’ve been writing about. But after a tough few weeks and months, we’ll need to see more than one up day to conclude the multi-month sideways phase (and recently, downturn) is over. We’re staying flexible, but we’ll keep our Market Monitor at level 5 and see how things play out from here.

This week’s list is again heavy on tech plays and energy, though we’re going with a special situation for our Top Pick, a firm who’s had a rough road but a huge acceleration in growth is coming this year and possibly beyond.

The Fed and the Iran war conspired to send stocks tumbling another 1.5% to 2% since we last wrote, though some easing of tensions on the latter front is giving the market at least a temporary jolt of energy today. But it’s still a risk-off market overall, and thus today we are adding another lower-risk position in the form of a high-yield REIT that’s the newest recommendation from Cabot Dividend Investor Chief Analyst Tom Hutchinson.

Details inside.

There’s been lots of news and volatility of late--but the evidence hasn’t changed much, which keeps us in a defensive stance. Tonight, in fact, we’re trimming two of our names based on their action. That said, we’re not hunkered down in our storm cellar--there are many rays of light out there, and we’re not just talking about secondary measures. Many growth stocks are acting just fine, holding near their highs, while even beaten-down areas have held well above their lows from weeks ago, a clear sign of relative strength. Thus, we’re remaining flexible in the face of bad news--but until the bulls put up a fight, we advise remaining heavily in cash.

“I’d rather be an optimist and wrong than a pessimist and right.” -Howard Marks

Stocks struggled again this week as the Federal Reserve held interest rates steady yesterday. Higher inflationary energy prices were weighed against anemic job growth. The Fed preserved a path to cut rates later this year as the economy evolves. Some consider our economy to be at a fragile equilibrium with pockets of growth.

It’s still an Iran-dominated market. The Iran war is by far the main event. But the market is starting off the week on a positive note because of optimism that the Strait of Hormuz will reopen and relieve oil price pressure.

So far, the market seems to be taking things in stride. The S&P 500 is only down about 1.5% for the month.

The Iran saga continues. But the market is starting off the week on a positive note because of optimism that the Strait of Hormuz will reopen and relieve oil price pressure.

The Iran situation is by far the main event in the market right now. The war could end quickly or drag on for a while. So far, the market is taking things in stride. The S&P closed last week down 3% for the month of March. That’s nothing like the tariff sell-off last April. But there is still downside risk.

Just when it looked like inflation was abating, with nationwide retail gasoline prices falling from an average of $3.20 to $2.73 a gallon between August and January, the specter of rising prices has appeared once again in the wake of the latest Middle East conflict.

As of this writing, the national gas price average is $3.63 a gallon (and rising by the day), which is 33% higher from the January low.

WHAT TO DO NOW: Remain cautious. Our Cabot Tides have joined our Two-Second Indicator and Growth Tides on the negative side of the fence. We have seen a couple rays of light from our Aggression Index and via some peppy growth names (mostly in the AI space)—but until the market can turn up, we advise staying close to shore. In the Model Portfolio, we sold Axsome (AXSM) this morning via special bulletin, leaving us with around 69% in cash; tonight, we’ll place our ProShares S&P 500 Fund (SSO) position on Hold given the market’s weakness and Tides red light.

After a fast start to the year, value stocks have been knocked backward of late.

Since the Iran war began at the end of February, value stocks – as measured by the Vanguard Value Index ETF (VTV) – have fallen nearly 3.5%, more than the Dow (-2.6%) and more than twice as much as the S&P 500 (-1.5%) this month. Overall, however, value stocks are in good shape, up 4.7% year to date and 8.8% in the last six months – both more than doubling the performance of the S&P and the Dow during those time periods. So, the sharper selling in value stocks this month may simply be a case of the bears (or, “the weak hands,” as my colleague Mike Cintolo more accurately calls them) coming for stocks that had more meat on the bone.

There’s never a dull moment in the stock market. Like everybody, I’m watching the situation in Iran closely.

For the market, it’s really all about the Strait of Hormuz and energy prices. If activities in the Strait remain severely disrupted for several more weeks, oil and natural gas prices are likely to stay elevated or move higher, despite the IEA’s recent decision to release 400 million barrels of oil (roughly 20 days of supply). The longer this persists, the greater the potential damage to the global economy and the stock market.

We’re in cannabis sector earnings season, once again. This is a great time of year because cannabis companies pull back the curtain to reveal and address important company and sector-level trends.

As usual during earnings season, I’ll focus on the most important company and sector developments from the most recently reported quarter. This earnings season report is more comprehensive than any other cannabis sector analysis out there because it cuts through the noise to get to the investing insights. It comes in two parts.

The CBOE Volatility Index (VIX) soared to the highest level since last April. Iran has thrown everything into flux, at least for now.

Oil prices soared to nearly $120 per barrel as war in the Middle East is spreading with no immediate signs of letting up. Several stock markets around the world suffered steep losses in Monday’s trading. U.S. stock market indices started the week’s trading down sharply but recovered somewhat by midday on Monday.

A quick housekeeping note: With the market acting increasingly volatile due to the war in Iran, I wanted to send the March update out today, a few days earlier than normal. Also, we will publish the March Issue of Cabot Early Opportunities one week later than normal, on Wednesday, March 25. This timing will allow me to finalize the issue after my family returns from Europe (my kids are on their March break) and, hopefully, give us a little more time to see how events unfold in the Middle East.

On to the update.

Like everybody else, I’m currently watching the situation in Iran as closely as possible. As far as the market is concerned, it’s really all about the Strait of Hormuz and energy prices. If the Strait remains closed/severely disrupted for several more weeks, then oil & natural gas prices will remain high/go higher. The longer this persists, the greater the damage to the global economy and the stock market.

The temptation among investors and analysts (myself included) to ascribe too much significance to short-term market movements is ever present. Treating the market as a crystal ball by observing how stocks respond to headline-making events—and then trying to discern the future—is something we’re all surely guilty of from time to time.

That’s why the latest happenings in the Middle East are proving once again that the human tendency to use markets to forecast the outcome of global events is alive and well.

The Iran conflict has roiled market and is creating some expected and unexpected winners and losers.

As uncertainty surrounding the conflict escalates, defense stocks are surging, cruise and airline shares are falling. The U.S. dollar edged up, and oil and energy prices are rising given that the Strait of Hormuz carries 20% of global oil supplies.

Specialty Industrials Shine. RBC and APGE Updates

Sell a Quarter Position in JetBlue Airways (JBLU)

Special Bulletin: Update on Gold/Silver Sell-Off

Sell Credo Tech (CRDO) and Viking Holdings (VIK)

CEO Special Bulletin: Position Updates

Today, a whopping eight Profit Booster positions will expire. Most are “slam-dunk,” full-profit trades, while others will go down to the wire.

The big takeaway, before we dive in, is we are going to let the situation play itself out, and come Monday/Tuesday of next week we will revisit our profits, as well as how we will manage the remaining positions.

WHAT TO DO NOW: While there’s been some modest improvement here and there, growth stocks continue to be unable to get going in any real way, with the Nasdaq stuck in the mud and our Aggression Index approaching multi-month lows. We already have a lot of cash, but today we’re pulling the plug on JFrog (FROG), which continues to have great fundamentals, but the stock (and the software sector overall) continues to sag. We’ll sell here and make sure a disappointing situation doesn’t get much worse.

Following yesterday’s after-hours preliminary Q4 earnings results, we are selling Beta Bionics (BBNX) today.

Applying principles from Benjamin Graham, Warren Buffett and other top value investors to bring you the bast value candidates.

Here are 10 of the soundest rules, tools and principles for selling winning stocks.

Cabot Top Ten Trader is meant to be something where we do the first four or five steps of the process for you and then let you take it from there.

I explore how to build a reasonably diversified portfolio based on a value investment approach.

Here’s a step-by-step guide to investing with the Cabot Benjamin Graham Value Investor.

I want to point out a problem that I foresee, potentially on the scale of the technology bubble in 2001 and the housing bubble in 2007. I think we’re going to have an “inverse ETF bubble.”

The fundamentals of value investment have been time tested. Followers of the value philosophy such as Warren Buffett, Seth Klarman and Howard Marks have amassed billions of dollars in their lifetimes. In a nutshell, here are the basic tenets of value investing.

One of the things many investors like best about dividend income is that it can qualify for the lower Federal capital gains tax rate. But not all dividends and distributions qualify.

We recently added a new real estate investment trust (REIT) to the High Yield Tier. REITs can be a great source of high income, but they have some unique features that investors should be aware of.

For growth stocks, buying low usually doesn’t mean you’re getting a bargain. It usually means you’re buying a laggard! That’s right—believe it or not, in the market, strength tends to lead to strength, while weakness tends to lead to weakness.

So how can you pick stocks that have a good chance to become winners? Interestingly, the best way is by looking backwards!

Here’s how Cabot Trend Lines, Cabot Tides and the 7.5% Rule can keep you on the right side of every market.