Despite some under-the-surface concerns, it was another strong week for the market as the S&P 500 gained 1.5%, the Dow was mostly unchanged and the Nasdaq added 1%.

Despite some under-the-surface concerns, it was another strong week for the market as the S&P 500 gained 1.5%, the Dow was mostly unchanged and the Nasdaq added 1%.

We made our fourth straight successful trade for this earnings cycle late last week. We were thankful to take quick profits in Amgen (AMGN) Wednesday morning. All went as planned as AMGN opened well within the chosen range of our iron condor and, as a result, we were able to take off the trade for a nice one-day gain of 5.6%. Our total return for this earnings cycle stands at 28.8%, one of our best performing earnings cycle since we initiated Earnings Trader back in mid-July 2022, smack dab in the middle of the most recent bear market.

The market’s primary evidence remains in good shape, and that’s especially true for leading growth stocks continue to act very well, and after two-plus years in the wilderness, we’re optimistic that the best names can continue to do well. That said, near-term, risks are rising for some sort of change in character (pullback, rotation, etc.) as there’s a growing divergence and some of the action out there is frothy. Because of that, we’re mostly riding our winners, but we sold a couple of laggards earlier this week and--for now--are holding about 30% in cash.

All that said, stay tuned: We could put some money back to work in the days ahead as earnings season continues to roll on, but for now, we’ll stay a bit closer to shore than we have been and see how things play out.

The markets have continued their bullish momentum so far in 2024, with growth stocks continuing to lead the way—especially large caps, which are up 32.94% so far this year.

Sector-wise, Communication Services (up 9.74%), Technology (up 5.07%), and Healthcare (up 4.11%) are the winners so far, with Real Estate (down 4.37%), Utilities (-2.91%), and Consumer Discretionary (-0/83%) the losing sectors.

Housing inventory is still tight, with prices remaining a little lofty. The S&P Case-Shiller home price index came in at a 5.4% rise, which was a bit less than the 5.7% forecast, but still higher than the month before.

Despite some worries early in the week, the bulls once again bought the dip, and pushed the indexes near all-time highs. For the week, the S&P 500 and Dow gained approximately 1.35%, and the Nasdaq rallied 1.7%.

Thank you for subscribing to the Cabot Value Investor. We hope you enjoy reading the February 2024 issue.

Spin-offs should be in every value investor’s toolkit. In this issue, we are adding a spin-off, Worthington Enterprises (WOR), to our Buy recommendations roster.

We comment on recent earnings from Comcast (CMCSA) and provide updates on our other recommended stocks.

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.

The primary evidence remains bullish, so we’re still thinking mostly positive, especially when looking at the big picture. But there’s no question things are getting more and more divergent: The broad market and even most big-cap stocks are flat to down so far this year, and more recently, as interest rates have backed up and financial stocks get hit, we’re seeing selling pressures start to spread. That doesn’t necessarily portend doom, but coming on the heels of a multi-month advance, this kind of action does raise the risk of a change in character; we’re going to pull our Market Monitor down a notch to level 7—still bullish, but holding a little cash, booking some partial profits on the way up and being more discerning on the buy side makes sense.

This week’s list has its share of hot stocks, and we’re impressed that we’re still seeing some strong earnings winners that are moving on very, very strong volume. For our Top Pick, we’ll go outside the tech space with a name that just lifted out of a multi-month base on earnings and could be leading a new group move. Try to buy on dips.

The major indexes are up to new highs, though they again have become very dependent on the Magnificent Seven in the last month after stocks of virtually all sizes and sectors rallied in November and December. Outside the Mag Seven, most stocks have been stagnant so far in 2024. Not so in the Stock of the Week portfolio, where we have multiple stocks hitting new highs, none of which belong to the Mag Seven, and TWO stocks that have doubled in the last year! We try and keep the hot streak going by adding a familiar, big-name growth stock that was beaten to a pulp during the bear market of 2022 and 2023 but has demonstrated some real momentum in the last three months. It’s a recent recommendation from Cabot Explorer Chief Analyst Carl Delfeld.

We made our third straight successful trade for this earnings cycle late last week. We were thankful to take quick profits in Microsoft (MSFT) Wednesday morning. All went as planned as MSFT opened well within the chosen range of our iron condor and, as a result, we were able to take off the trade for a nice one-day gain of 11.1%. Our total return for this earnings cycle stands at 23.2%.

Not much to say this week. The plan remains simple. I continue to focus on balancing out the overall deltas of our current positions by adding a trade, most likely a bull put spread. I’ll be concentrating on sector ETFs and individual stocks as the major indices continue to see low levels of volatility.

As always, if you have any questions, please do not hesitate to email me at andy@cabotwealth.com.

Despite some worries early in the week, the bulls once again bought the dip, and pushed the indexes near all-time highs. For the week, the S&P 500 and Dow gained approximately 1.35%, and the Nasdaq rallied 1.7%.

The market has been a little soft this week as better-than-feared results from many large caps, including Microsoft (MSFT) and Facebook (META), have been somewhat overshadowed by renewed fears of banking turmoil. Thanks First Republic (FRC). That stock is down 96% from its 2023 high (and that wasn’t a particularly high price).

This is a big earnings week that could determine the near-term direction of the market.


This earnings quarter started at the beginning of this month. But the rubber hits the road this week. Big technology companies including Alphabet (GOOG), Microsoft (MSFT), Amazon (AMZN), and Meta (META) as well as energy companies Exxon Mobile (XOM), Chevron (CVX), and Valero Energy (VLO) all report this week.

April is a big earnings month for large-cap stocks. A few of our companies (Esquire and Redishred) have reported earnings but most will report in May or June.

It was only a month ago when we wrote about how the seemingly out-of-the-blue turmoil in the banking sector, driven by the sharp increase in interest rates, could lead to a major financial accident that traumatizes the world’s capital markets. Part II recognizes an ever-expanding roster to include additional percolating problems.

Three companies, First Horizon (FHN), Holcim (HCMLY) and Nokia (NOK) reported earnings this week. Next week, General Electric (GE), Xerox (XRX), Polaris (PII), M/I Homes (MHO), Mattel (MAT), Dril-Quip (DRQ), Capital One Financial (COF) and Newell Brands (NWL) are scheduled to report earnings. The following week, at least eight companies will report earnings.

Cabot Options Institute Quant Trader is focused exclusively on creating consistent returns using high-probability options strategies including bear call spreads, bull put spreads, iron condors and more. Whether you have questions about the strategies, or even about setting up your account, or how to make your own trades, Andy will answer all of your questions

The market continues to act “fine” as we get a little deeper into earnings season this week.

At the index level, small-cap stocks are unremarkable. But I continue to attribute the underperformance to the high weight of rate-sensitive sectors (financials, energy, industrials, materials).

Cabot Options Institute Income Trader is focused exclusively on the creating consistent income through a variety of options selling strategies. Whether you have questions about selling puts, covered strangles, jade lizards or our income wheel approach, Andy is more than happy to help you steepen your learning curve in this live event.

January was up. February was down. March was up. April has not yet tipped its hand.


The S&P 500 is up 8.12% YTD, as of Monday’s close. It’s been a bouncy market that has bounced up more than down so far. April has been directionless because investors are waiting for earnings.

This week is school vacation week in Massachusetts, so I’ve spent the last five days in Puerto Rico with my family and a couple other families.

Highlights include:

1) Hiking into El Yunque rainforest for a swim in a little creek.

2) A night bioluminescent tour.

3) Lots of delicious margaritas!

In terms of micro-cap updates, it was a quiet week so I figured I would spend my update on Unit Corp. (UNTC) as I spoke to the CFO last week and got some good updates.

SPY continues to rally and has now pushed through our short 415 call strike. As a result, I am going to take off the trade. I will be following up this trade with a few opening trades as we need to start looking towards March expiration for premium-selling opportunities.

Our WBA calls are due to expire today, so I want to buy them back for a few pennies and immediately sell more premium. JPM and AMGN are due to expire next week, but most, if not all of the premium has left the respective calls. Therefore, I want to buy back our short calls and like WBA, immediately sell more calls.

I will be exiting the Disney (DIS) trade today. I will discuss the trade in greater detail in our subscriber-exclusive webinar at noon ET tomorrow, February 10.

As discussed in our weekly issue this week, and on our weekly call last Friday, I will be taking a position in Disney (DIS) today. DIS is due to announce earnings after the closing bell today (February 8). The stock is currently trading for 111.10.

With February 17 right around the corner and several of our positions with little to no premium left, I want to start the process of buying back our short calls and immediately selling more premium.

Inspire Medical (INSP) delivered yet another better-than-expected quarter after the closing bell yesterday as Q4 results came in near the high end of management’s pre-announced range.

Pinterest (PINS) reported Q4 results after the bell yesterday that were lighter than expected but don’t change the story of a company streamlining operations and tweaking the platform to drive modest user growth and, as a result, higher advertising revenue. Pinterest is also growing internationally.

I don’t love the action in Procept (PRCT) this week. While the broad market has been acting well and a lot of “risk on” stocks have gone up, shares of PRCT have headed south.

Today we are moving shares of Dow (DOW) from Buy to Sell. As the shares have reached our 60 price target, and with no compelling reason to raise that target, we are moving the shares from Buy to Sell. This change will also be made in the Cabot Turnaround Letter.

Moving Kraft Heinz (KHC) to Sell

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.