Happy Thanksgiving Rally!
First, Happy Thanksgiving! I hope you have a nice long weekend wherever you are, and with whomever you will spend it.
Second, if you’re looking for a yummy and refreshing drink that’s not too strong and not too weak, consider a hard cider on ice. I was slow to jump on this bandwagon since I remember the hard ciders from my younger days as being downright awful. But the stuff they’re making today is top notch. Poured over a big glass of ice and sipped slowly makes for a hard to beat celebratory drink, in my opinion.
We’ve been drinking the varieties from Stowe Cider, Champlain Orchards and, when we go to Vermont, the Cold Hollow Cider Mill. Just like craft brews, there’s tons to choose from these days, so I’m sure there’s something delicious near you too.
Finally, how about this market?
I read this morning that the broad market just notched its 100th high since President Trump was elected. Hard to believe.
Perhaps even harder to believe is that small caps just might be breaking out!
The move was reported in several financial media outlets yesterday because the Russell 2000 Small Cap Index jumped out to a 52-week high (but not all-time high, yet).
The same thing occurred in the S&P 600 Small Cap Index.
There is no doubt this is an encouraging sign for early-stage stocks.
Small caps have been lagging, and have failed to return to their 2018 highs, for too long. If the asset class can get back in gear, we’ll have more things working in the market for early-stage investors.
Concurrently, we’re seeing more strength in the IPO market too. The Rennaissance IPO ETF (IPO) isn’t back to its 52-week high, but it has come off the October low nicely and is as high as it’s been since early-August.
This has all translated into solid performance in our stocks.
Leading the charge is Deciphera Pharma (DCPH) which is up 41% since mid-October. Both Digital Turbine (APPS) and Dynatrace (DT) are up 27% since mid-September, and eHealth (EHTH) and Five9 (FIVN) are up 11% and 6%, respectively, over just the last week.
Not everything has worked out perfectly, of course. We had to let The RealReal (REAL) go due to poor performance. Frontdoor (FTDR) is down 11% from when I first covered it, and Survey Monkey (SVMK) is down 6%.
But everything else is in the black, and the average gain across currently covered positions is 8%. That performance is twice what the broad market has delivered since we launched Cabot Early Opportunities in mid-September. So far, so good!
Have a nice Thanksgiving, and I’ll be back in touch next week.