Cabot Explorer Issue: October 9, 2025

Portfolio Changes: Coeur Mining (CDE) – Move from Buy a Half to Hold

The Rise of Gold and Chinese Stocks as Dollar Weakens

Gold hit $4,000 an ounce and the signal this is sending is not hard to grasp.

Investors are enjoying stock gains but are hedging downside currency and stock price risk as well as a hedge on growing government debt and geopolitical risk. Gold seems the most popular safe haven as it is viewed as a safe harbor asset in a way that the greenback used to be viewed. Gold’s rally began almost three years ago, fueled by central banks and Chinese investors leery of both its stock and property markets.

Artificial Intelligence (AI) might not be the only possible bubble. Critical metals are a bit frothy and well boosted by state capitalism as seen in the MP Materials (MP) deal with price supports and this week’s White House announcement that it is taking a 10% position in Canadian miner Trilogy Metals (TMQ), which promptly jumped nearly 200%.

Our Coeur Mining (CDE) recommended shares are up an amazing 267% this year as silver prices have really moved. Given the size of this gain, I advise taking partial profits and although silver and this stock have considerable momentum, I’m moving this stock to a hold.

Meanwhile, China’s stock markets are having a nice run, led by technology such as artificial intelligence. The MSCI China Index, which tracks the country’s largest companies, has notched gains for five straight months. The index is up more than 40% this year, greatly outpacing a similar index for U.S. stocks.

Alibaba (BABA), which makes widely used open-source systems, has gained more than 120% this year. By comparison, Nvidia (NVDA) is up about 40% this year. Like the United States, the Chinese index is dominated by tech companies, with Tencent, Alibaba and Xiaomi accounting for about 30% of the benchmark. Baidu (BIDU) shares have been on a tear this year, hitting a two-year high amidst optimism over AI.

The weaker dollar is tilting capital flows to multinational and exporter-heavy companies and stocks. The reason is a weaker dollar boosts a U.S. company’s foreign earnings in dollar terms, while also making American goods cheaper abroad. Domestically focused companies do not tend to benefit, and those firms that rely on buying inputs from overseas in foreign currency face higher input costs resulting in lower profits.

Multinational stocks are another way to diversify internationally and hedge the dollar, as evidenced in the below chart, courtesy of Bloomberg.

Now we shift gears to our new recommendation – a quality value stock that has shifted manufacturing back to the United States.

New Recommendation

Newell Brands (NWL)

I have followed Newell (NWL) for a long time and my thesis for recommending it today is simple. Since about 2017, the company has shifted the lion’s share of its manufacturing from China back to America. This required $2 billion of investment for technology and training which of course could have been used to buy back its stock.

It is interesting that the company’s headcount and product pricing has remained constant, but the amount of technology and robotics used in production has risen significantly. The average wage at its Maryville facility, which employs 550 people, has also gone up around 50% over the past five years.

The stock price has suffered as this scenario has played out and I believe the company is now poised to reap the benefits from this transition.

Newell may not be a well-known name, but its 50 brands certainly are and include the likes of Rubbermaid, Graco, Coleman, Ball food preservation products, Calphalon premium cookware, Crockpot slow cookers, Mr. Coffee coffeemakers, and countertop essentials from Oster.

Perhaps its most iconic brand is Sharpie.

At least half a billion Sharpie markers in 93 colors are turned out in the U.S. every year. Only the felt tip is imported, from Japan. Most Sharpies are now made at this 37-year-old factory in Maryville, Tennessee, which operates around the clock, making 1.8 million fine-tip Sharpies at a speed three to four times faster than before.

Newell’s CEO Chris Peterson has a great background for this transformation having both financial acumen as a former CFO and spending two decades at consumer giant Procter & Gamble.

Newell stock presents us with a good value trading at just 80% of book value with a forward price to earnings ratio of less than 7 with a dividend yield of 5.3%. Trading at 5.12, Newell’s stock is sharply down from its 52-week high of 11.78.

Third-quarter earnings will be out October 31.

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 flat this this week despite all the attention on historic gold prices. We should expect some sort of price pullback at some point for this stock which has been at the forefront of the gold rally. The company has mining operations in Canada, Mexico and Finland. Buy a Half

Alibaba (BABA) shares were steady this week for this China bellwether company which makes widely used open-source AI systems. Like the United States, the Chinese index is dominated by tech companies, with Tencent, Alibaba and Xiaomi accounting for about 30% of the benchmark. Buy a Half

Baidu (BIDU) shares have been on a tear this year hitting a two-year high amidst optimism over artificial intelligence (AI). Earlier this week, Baidu secured an AI-related deal with China Merchants Group, a major state-owned enterprise. Baidu is much smaller than Google, but it generates significant free cash flow and is dominant in China with 75% of its search traffic. Buy a Half

Banco Santander (SAN) shares pulled back 3% this week and the shares have been quiet lately but up 126% so far this year. There is still upside potential as this bank is trading at just under 10X forward earnings, but you may wish to sell some shares to lock in profits. Buy a Half

Coeur Mining (CDE) shares are up an amazing 267% this year as silver prices have really moved. Given the size of this gain, taking partial profits makes sense and although silver and this stock have considerable momentum, I’m moving this stock to a hold. Move from Buy a Half to Hold

Luckin Coffee (LKNCY) shares were up 11% this week and present us with a mixed picture trading at six times book value but a reasonable 17 times forward earnings with an impressive 30% return on equity. The company has come a long way since its founding in 2017, operating about 26,000 stores as of mid-2025. Buy a Half

Sea Limited (SE) shares were up 5.9% this week even as the company is facing some competitive pressures from MercadoLibre (MELI). The company is demonstrating good revenue growth, but concerns over valuation remain so I’m leaving this a hold. Hold a Half

Explorer Dominator Blue-Chip Recommendations – More Buy and Hold

Alphabet (GOOG) shares were steady this week with earnings growth of 24% expected for the year. The company is making a major move in AI and dominates global search with an estimated 80% global market share. Buy a Half

International Business Machines (IBM) shares are approaching 300 as the company announced that it would be integrating Anthropic’s Claude model directly into its tools with the purpose of advancing AI-enabled enterprise infrastructure. Early testing of this integration among 6,000 internal users resulted in average productivity gains of 45%, delivering cost savings while maintaining code quality. Buy a Half

Visa (V) shares were up a bit this week as Visa launched a pilot program that lets businesses fund international payments using stablecoins rather than pre-depositing cash in local bank accounts. The company expects to report its next quarterly earnings on November 4. Buy a Half

Explorer ETF/Fund Positions

CurrencyShares Swiss Franc Trust (FXF) gives you exposure to a high quality country and currency with fiscal discipline, a trade surplus, and very little foreign debt, and a reputation as an asset haven in times of stress. Buy a Half

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. Hold

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

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

ProShares MSCI EAFE Dividend Growers ETF (EFAD) seeks to capture the performance of companies with at least 10 years of consecutive dividend growth. 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 Full

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

Tweedy, Browne Insider and Value ETF (COPY) provides exposure to a combination of value, international, small cap stocks managed by a stellar asset manager. 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

ETFs

The next Cabot Explorer issue will be published on October 23, 2025.

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