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Explorer
The World’s Best Stocks

Cabot Explorer Issue: June 5, 2025

Explorer stocks are either steady or performing well with Dutch Bros (BROS) shares up 18.4% during the last two weeks and Luckin Coffee (LKNCY) shares jumping 9.4% this week after a strong first quarter with 41% year-over-year revenue growth.

In addition, Singapore’s Sea Limited (SE) shares are up 18.6% during the last two weeks, and Spain’s Banco Santander (SAN) shares have surged 73% so far in 2025. China’s BYD (BYDDY) shares are up 53% in 2025. New silver and gold play Coeur Mining (CDE) shares were up 13.5% in their first two weeks in the portfolio.

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Portfolio Changes:
Morgan Stanley China A Share Fund (CAF) – Move from Buy to Sell
Subaru (FUJHY) – Move from Buy to Sell

Gold, Bitcoin, and Dividends

Explorer stocks are either steady or performing well with Dutch Bros (BROS) shares up 18.4% during the last two weeks and Luckin Coffee (LKNCY) shares jumping 9.4% this week after a strong first quarter with 41% year-over-year revenue growth.

In addition, Singapore’s Sea Limited (SE) shares are up 18.6% during the last two weeks, and Spain’s Banco Santander (SAN) shares have surged 73% so far in 2025. China’s BYD (BYDDY) shares are up 53% in 2025. New silver and gold play Coeur Mining (CDE) shares were up 13.5% in their first two weeks in the portfolio.

One trend driving gold demand is escalating buying by central banks.

This is likely to continue as Goldman Sachs reports that central banks are acquiring about $8.5 billion worth of gold each month as they diversify holdings away from the U.S. dollar. This is an opaque market, and I suspect that China is likely the biggest buyer though many central banks around the world are also boosting gold holdings.

This is consistent with less appetite for U.S. Treasury bonds for geopolitical reasons, the cost of hedging currency risk, and the risk of having too many eggs in the dollar basket.

A strong and stable dollar is a critical issue for foreign central banks. The U.S. dollar gained 31%, 17%, and 12%, against the yen, euro and pound, respectively, between early 2021 and the middle of 2022. Now, the dollar is weakening, and a Japanese government 30-year bond yields 2.9%, thus becoming more attractive to investors.

This is just speculation, but I have for some time believed that China is developing a plan to back its currency (yuan) with gold or a basket of precious metals. The Shanghai Gold Exchange is opening vaults abroad, and Shanghai futures access is expanding as well.

While China has banned bitcoin, bitcoin supporters are framing bitcoin as a more modern and increasingly mainstream alternative to gold. It is interesting to read more and more articles highlighting that investors are pairing the two by adding both gold and bitcoin to their portfolios.

Gold is a traditional store of value and hedge on inflation serving as both portfolio insurance and a shock absorber. Gold is seen as wealth protection.

Bitcoin has some of gold’s attributes but is more speculative and volatile.

Attention to both has risen with debt. Since 2000, total federal government debt has grown by 560%, from $5.6 trillion to $37 trillion. Total debt (public, private, and corporate) has grown 281%, from $27 trillion to $102 trillion.

Now we turn to dividends, another effective way to reduce risk and volatility in a portfolio.

New Recommendation

ProShares MSCI EAFE Dividend Growers ETF (EFAD)

Dividends have always been an important and unappreciated part of total returns. They also serve as a “shock absorber” when markets pull back.

But investors may have taken their eye off the ball since Covid, as dividends declined to only about 20% of returns in global equities as the “Magnificent Seven” tech stocks dominated the performance charts.

This trend is reversing, and dividends will likely resume a larger role in total equity returns.

In addition, dividends have been playing an outsized role in international equity returns. For example, from 2004 to 2024, dividends as a percentage of total returns were 38% for the S&P 500 but 73% for the MSCI EAFE index, which covers companies based in countries outside of North America.

I have decided to recommend the ProShares MSCI EAFE Dividend Growers ETF (EFAD) because it invests in companies that have consistently increased their dividends.

Specifically, it seeks to capture the performance of companies with at least 10 years of consecutive dividend growth. It has also outperformed the competition with a total return of 12.4% over the past year.

This ETF also has a nicely balanced high quality portfolio with 17% of assets invested in healthcare, 15% in industrials, 14% in technology, 13% in consumer defensive, and 10% in financials.

BUY A HALF

Explorer Weekly Stock Commentary

Below is a brief update on each Explorer stock. Any changes in ratings will be highlighted. This section is all you need to read each week.

Explorer Disrupter Recommendations – need to watch more closely and have a 20% trailing stop-loss in place.

Agnico Eagle Mines (AEM) shares were up 4.9% this week and are up 59% so far in 2025. Gold has risen with inflation and uncertainty as well as a weaker U.S. dollar. Central bank purchases have been the primary factor driving up demand with China’s central bank leading the way. Buy a Half

Banco Santander (SAN) shares have surged 73% in 2025 and now trade at book value which could limit additional near-term gains. You may wish to take some profits off the table though this stock is poised for steady growth. The bank recently reached 100,000 customers in the United States – a key milestone for its Openbank digital platform. Buy a Half

BYD (BYDDY) shares were up 2.4% this week and 53% in 2025 after recent price cuts on 22 electric and plug-in hybrid models in China. This is a competitive market, and lower prices will squeeze some automakers out of a market dominated by BYD. One of BYD’s advantages is that it is vertically integrated, making some semiconductors and advanced lithium ferrous phosphate (LFP) batteries. Buy a Half

Coeur Mining (CDE) shares were up 13.5% in the stock’s first two weeks as an Explorer recommendation. A stock buyback plan and strong uptrend in precious metal prices is in place. Coeur is a mining company that explores gold, silver, zinc, and other related metals in the U.S., Canada, and Mexico. This is a speculative recommendation and timing a strong turn in silver stocks is difficult. BUY A HALF

Dutch Bros (BROS) shares are up 18.4% during the last two weeks after the company opened 30 new locations and reported a 29% increase in revenue in the first quarter. This brings the total number of coffee outlets to 1,012 at the end of March, spanning 18 states. The company plans to open at least 160 shops in 2025. The stock is expensive at this point, so I suggest you sell some shares to lock in gains. Hold a Half

Luckin Coffee (LKNCY) shares jumped 9.4% this week after the company reported strong first-quarter results highlighted by year-over-year 41% revenue growth. The company opened a stunning 1,757 new outlets in the quarter for a total store count over 24,000. It opened 8 new stores in Malaysia and plans a store in New York as Starbucks (SBUX) looks at revamping its China operations. Buy a Half

Mitsui (MITSF) shares were lethargic again this week and this stock needs a spark to gain momentum. Mitsui is a legendary company in Japan and its stock trades close to book value and only 10 times forward earnings. Buy a Half

Sea Limited (SE) shares are up 18.6% in the last two weeks but I’m maintaining a cautious hold as the stock’s current valuation looks expensive based on its 2026 forward price-to-earnings ratio. In its last quarter, sales climbed 30% to $4.84 billion, roughly in line with estimates. Hold a Half

Subaru (FUJHY) shares were treading water again this week so I’m moving this to a sell despite Subaru being an excellent company trading at about five times trailing earnings and about 70% of book value. We can chalk this one up to tariffs and a very challenging global auto market. Move from Buy to Sell

Explorer Dominator Blue-Chip Recommendations – More Buy and Hold

DBS Bank (DBSDY) shares were steady as this “gold standard” of an Asian bank represents a solid core holding albeit with limited short-term upside. DBS just had a solid quarter and is still looking at loan growth of 5% to 6% this year. Buy a Half

International Business Machines (IBM) has been part of the Fortune 500 list every year since debuting in 1955 and its shares are up about 20% so far this year. Although top-line growth is not overwhelming, the company is pouring billions of R&D capital into new AI models and AI infrastructure as well as updating its hybrid cloud platform. Buy a Half

Visa (V) shares were up this week and have managed a decent performance this year, rising 16%. Jefferies modestly raised its price target for the stock which could surprise us given its 50% profit margin and 50% return on equity. It also recently announced a $30 billion share buyback program. Buy a Half

Watch List – Stocks we like but do not follow day-to-day

ConocoPhillips (COP), Franco-Nevada (FNV), MOOG (MOG-A)

Explorer ETF/Fund Positions

Grayscale Bitcoin Trust (GBTC) offers investors a way to track very closely to the day-to-day or “spot” movement of bitcoin prices. For aggressive investors comfortable with volatility. Buy a Small Allocation

JPMorgan Equity Premium Income ETF (JEPI) offers double-digit yield coming from both option premiums and dividends using a value-focused strategy. Buy a Full

Morgan Stanley China A Share Fund (CAF) offers exposure to a basket of top Chinese-listed stocks which could easily be caught in the crossfire of the trade conflict. For that reason, it’s time to sell. Move from Buy a Half to Sell

Oberweis Micro-Cap Fund (OBMCX) fund stands out for several reasons. The fund’s sound investment process and strong management team earns it a rare Morningstar Medalist Rating of Gold. Over the past five years it has posted an impressive average annual return of 24%. Buy a Half

Sprott Platinum and Palladium ETF (SPPP) offers direct exposure to both platinum and palladium which are selling at a sizable discount to gold offering potential upside appreciation. Buy a Half

Stoxx Europe Total Market Aerospace & Defense (EUAD) tracks an index of top defense contractors including Leonardo, Rheinmetall, and BAE Systems. Buy a Half

VanEck Junior Gold Miners ETF (GDXJ) is a basket of junior miners that has 84 positions with the top 10 accounting for 44% of total assets. Half of the stocks are Canadian, 21% Australia, and 7% from South Africa. BUY A HALF

WisdomTree Emerging Markets High Dividend Fund (DEM) offers a high dividend yield and some of the highest quality emerging market stocks. Buy a Half

Model Portfolio

StockPrice BoughtDate Bought6/4/25ProfitRating
Agnico Eagle Mines (AEM)8810/24/2412441%Buy a Half
Banco Santander (SAN)511/7/24862%Buy a Half
BYD (BYDDY)6612/5/2410559%Buy a Half
Coeur Mining (CDE)85/23/25915%Buy a Half
DBS Bank (DBSDY)1392/27/251401%Buy a Half
Dutch Bros (BROS)328/15/2472127%Hold a Half
International Business Machines (IBM)1336/29/23266100%Buy a Half
Luckin Coffee (LKNCY)292/13/253622%Buy a Half
Mitsui & Co. (MITSF)205/8/25213%Buy a Half
Sea Limited (SE)492/29/24168244%Hold a Half
Subaru (FUJHY)93/13/259-3%Sell
Visa (V)2418/24/2336852%Buy a Half

ETFs

StockPrice BoughtDate Bought6/4/25ProfitRating
Grayscale Bitcoin Trust (GBTC)472/15/248377%Buy a Small Allocation
JP Morgan Equity Premium Income ETF (JEPI)545/4/23563%Buy a Full
Morgan Stanley China A Share Fund (CAF)121/25/23138%Sell
Oberweis Micro-Cap Fund (OBMCX)429/12/24431%Buy a Half
ProShares MSCI EAFE Dividend Growers ETF (EFAD)--NEW43--%Buy a Half
Sprott Physical Platinum & Palladium Tr (SPPP)91/17/251012%Buy a Half
Stoxx Europe Total Market Aerospace & Defense (EUAD)344/24/254224%Buy a Half
VanEck Junior Gold Miners ETF (GDXJ)573/27/256922%Buy a Half
WisdomTree Emerging Markets High Dividend Fund (DEM)329/29/224437%Buy a Half

Explorer Stocks Summary

Brief company summaries that will not change week to week.

Agnico Eagle Mines (AEM) follows a conservative strategy and with a history spanning more than 60 years, and now operates a sizable portfolio of 11 assets located in four countries. Management forecasted gold production of approximately 3.45 million ounces in 2024. The company estimates it has about 54 million gold ounces of proven and probable reserves. Furthermore, Agnico Eagle has paid a dividend for 41 consecutive years with a dividend compounded growth rate of 23% per year since 2005.

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Banco Santander (SAN) was founded in Spain in 1857. The bank’s U.S. headquarters is in Boston, but its strength lies in Latin America and Europe where it has more than 8,000 branches with 171 million customers as well as 58 million digital accounts. About 55% of deposits and loans are in Europe with the balance in Latin America. In its most recent quarter, Santander’s revenue was up 8% while net profits increased 16%.

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BYD (BYDDY) Most of BYD’s sales are still in China but it has a big international expansion underway, including in the U.S., Europe, and Asian markets. BYD will also launch a next-generation Blade battery in 2025, with longer range and faster charging. That, along with various other models, could help rev up BEV sales growth next year. BYD expects solid-state batteries for high-end models by 2027, but not fully reaching lower-end models until 2030-2032.

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Coeur Mining (CDE) is a mining company that explores gold, silver, zinc, and other related metals in the U.S., Canada, and Mexico. For many precious metal investors, silver is seen as gold’s “little brother,” but it has a long history as a means of payment going back centuries as the Spanish silver dollar was once the reserve currency of the day. In 2025, we passed the 100:1 mark for only the fourth time in a hundred years – a strong signal that silver may be underpriced. While gold has reached an historic high, the silver price is almost 50% off its all-time high in U.S. dollars per ounce.

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Watch List: ConocoPhillips (COP) is a global energy industry giant and one of the largest independent exploration and production (E&P) companies in the world, as measured by production levels and proved reserves. The company, founded in 1917 and based in Houston, has operations in 13 countries, although almost half the company’s production is derived from U.S. sources.

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DBS Bank (DBSDY) is one of the largest banks in Southeast Asia with a presence in 19 markets. It is headquartered in Singapore, with its main listing on the Singapore Stock Exchange, and is the largest constituent of the Singapore Straits Times Index. The Government of Singapore established DBS in July 1968 and its largest and controlling shareholder is Temasek Holdings, which is one of two large sovereign wealth funds controlled by the Government of Singapore. DBS has assets of roughly $750 billion and a growing presence in the three key Asian areas of growth, which it defines as Greater China, Southeast Asia, and South Asia, meaning India. It is the largest and strongest bank in Southeast Asia and the leading consumer bank in both Hong Kong and Singapore.

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Dutch Bros (BROS) is an operator and franchisor of drive-through coffee stores, with 1,012 stores as of the end of the first quarter, including 30 that it opened in the quarter. It’s expanding at a steady pace, expecting up to 150 new stores in 2025, and it envisions up to 7,000 stores over the next 10 to 15 years.

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Watch List: Franco-Nevada (FNV) is a company with more than half of its revenue coming from gold, but it also offers exposure to platinum, silver, and oil and gas. Franco-Nevada’s focus on royalties and streaming reduces risk and enables it to sidestep the huge capital costs that impact traditional miners. It enjoys cash flow and profits as its mining partners finance and complete exploration and expansion projects. That cash flow enables it to invest in new deals, pay a dividend, and operate debt free. Franco-Nevada has increased its dividend each year since its IPO in 2008.

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International Business Machines (IBM) is a blue-chip artificial intelligence (AI) and India play with a nice dividend yield. Known as “Big Blue,” IBM now primarily helps businesses and governments manage their information technology in the cloud era. The stock sells at a discount to the S&P 500 multiple and the information technology sector’s forward earnings multiple. IBM has paid a dividend every quarter since 1916 and has had 30 consecutive years of dividend increases.

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Luckin Coffee (LKNCY) is a leading purveyor of coffee and specialty drinks in China. The price of a cup of Starbucks coffee is more than double that of Luckin coffee. In addition, Luckin is adept at adapting to local tastes and launching new products that broaden the market. For instance, it brings to market about 60 new products each year, offering a new drink every week. Its new coconut latte sells nearly $140 million worth annually.

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Mitsui (MITSF) stands out among the big five by leaning into mining and materials. Mitsui has entered joint ventures around the world, taking project stakes in iron ore, metallurgical coal, copper, nickel, and LNG with 50%-60% of profit coming metals and energy. But Mitsui’s chairman emphasizes that Mitsui is not a resource company. Rather he describes the company as a place where smart people identify new trends and pursue big profits through small experiments. For example, Mitsui owns 33% stake in IHH Healthcare, the largest hospital group in Asia, and stake in Penske Automotive in North America. Other sectors of activity include energy, infrastructure, agriculture and food, and consumer retail.

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Watch List: Moog, Inc. (MOG-A) supplies advanced primary flight controls on the most modern military aircraft. That includes the Lockheed Martin F-35 Lightning II and the Future Long Range Assault Aircraft program. The company’s major platforms include the 787, A350, Joint Strike Fighter (F-35 Lightning II). The company also supplies primary flight controls for the Boeing 787 and Airbus A350 widebody aircraft, as well as business and regional jets from Embraer (ERJ) and Gulfstream, owned by General Dynamics (GD).

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Sea Limited (SE) has three core businesses: 1) digital gaming/entertainment, 2) e-commerce, and 3) digital payments and financial services, known as Garena, Shopee, and Monee (formerly SeaMoney), respectively. Garena is a leading global online games developer and publisher. Shopee is the largest e-commerce platform in Southeast Asia and Taiwan. Monee is a leading digital payments and financial services provider in Southeast Asia.

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Visa (V) doesn’t extend credit but provides the plumbing for financial payments and communications throughout the world. Visa’s financial infrastructure also underpins much of the world’s commerce. The duopoly between Visa and Mastercard is often referred to as one of the best businesses in the world, with insurmountable moats, low operating costs, and plenty of opportunities for unlocking additional value. Visa currently trades at a discount to its archrival MasterCard.

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The next Cabot Explorer issue will be published on June 18, 2025.


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Carl Delfeld is your guide to growth trends and bull markets around the world. His Cabot Explorer will show you the vast profit potential of investing in emerging economies as well as other world stock markets.