October 30, 2025

Portfolio Changes: None

OpenAI More Valuable than Goldman Sachs (GS)?

To begin, just a heads up that there will be no Cabot Explorer issue on November 6 as I will be in transit for a mining and resource conference in Senegal. I will of course keep an eye on our stocks.

As expected, the Federal Reserve cut interest rates by a quarter point yesterday. This was largely already baked into the market. Looking ahead, Fed Chairman Jerome Powell had an impactful comment: “What do you do if you are driving in the fog? You slow down.”

This comment is consistent with our strategy of alternating aggressive and conservative stocks, taking partial profits to build cash, and seeking international diversification. Our Alphabet (GOOG) shares were up 9% this week after the company reported a 35% increase in earnings and $102 billion in revenue. Alibaba (BABA) shares jumped 8.5% this week and have risen 117% so far in 2025. International Business Machines (IBM) shares were up 7.2% this week as the company recently reported 9% quarterly revenue growth.

Valuations are getting a bit crazy. Goldman Sachs (GS) has been built up over a century but OpenAI, which was built up over the last decade, is more valuable than Goldman Sachs. Nvidia (NVDA) is now worth an astounding $5 trillion. About 10% of the world is now using OpenAI, and Chat GPT, and that alone is remarkable.

More than a third of the S&P 500 are posting third-quarter results this week. There is increasing concern about the U.S. economy’s growth prospects and a continuing trade war has led more investors to look beyond America to overseas stocks at cheaper prices. In fact, those international stocks are outperforming U.S. stock indexes by the widest margin in 16 years.

The MSCI All Country World ex USA Index, which tracks developed and emerging-market stocks, is up around 26% in 2025 on a U.S. dollar basis. The S&P 500 is up about 17%. Meanwhile, the U.S. dollar is down around 6% this year while interest payments on the U.S. national debt now total roughly $1 trillion per year, the fastest-growing category in the federal budget.

The broad outlines of a U.S.-China détente have been released and it looks like things are just going back to where they stood six months ago. The winner may be China as it showed how its economic strength allowed it to push back against American pressure tactics.

Economic strength is the foundation of national strength and the path to geopolitical supremacy runs through dominance in the key strategic sectors. In 1980 Chinese economic output was just $191.5 billion in current U.S. dollars. Today, China has about a $20 trillion economy – nearly five times as large as India’s.

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

Agnico Eagle Mines (AEM) shares retrenched 4.1% this week pretty much in line with gold prices as the company reported quarterly earnings of $2.16 per share, beating expectations. This compares to earnings of $1.14 per share a year ago. Agnico has a profit margin of 30% with only 3% debt to equity. Buy a Half

Alibaba (BABA) shares jumped 8.5% this week and have risen 117% so far in 2025. The company is expanding in cloud services and e-commerce through a massive UAE data center. BABA makes widely used open-source AI systems. Buy a Half

Banco Santander (SAN) shares were up 5.9% this week as the bank posted record profits for the sixth consecutive quarter on strong performance in America, where it has been expanding its operations. The Spanish bank’s third-quarter net profit increased 8%. Buy a Half

Coeur Mining (CDE) shares continue to retreat after a strong silver bull run and were down 3.8% this week as silver prices retrace. I have been suggesting taking some partial profits to lock in big gains and will keep this stock a hold. Hold a Half

Luckin Coffee (LKNCY) shares were up 3.3% this week and have booked a 66% gain so far this year. The Australian broker Macquarie has set a price target of 52 based on earnings estimates for 2026. I think this is a great growth story. Buy a Half

Newell Brands (NWL) shares were up a little again this week. Newell stock is a good conservative value story trading at just 80% of book value with a forward price to earnings ratio less then 7 and a dividend yield of 5.3%. Third-quarter earnings will be out this Friday. Buy a Half

Sea Limited (SE) shares were steady this week as investors weigh the company’s strong growth and market position versus its premium stock price. Sea is delivering balanced growth across all core businesses, including e-commerce (Shopee), digital entertainment (Garena) and digital money (Monee). I’m leaving this a hold. Hold a Half

Universal Technical Institute (UTI) shares were steady in their first week as an Explorer recommendation. This company focuses on skilled tech in areas such as auto, marine, aviation, welding, HVAC, and robotics. On the healthcare side, Universal offers degrees in dental tech, medical tech, nursing, and physical therapy. Universal currently has 22,000 students spread across 32 campuses offering both online and onsite classes so the economies of scale are significant in terms of revenue and margins. In its last quarter, revenue was up 15% and earnings per share were up an impressive 115%. Buy a Half

Explorer Dominator Blue-Chip Recommendations – More Buy and Hold

Alphabet (GOOG) shares were up 9% this week after the company reported a 35% increase in earnings and $102 billion in revenue, driven by strong demand in search, cloud, and YouTube advertising. Cloud and AI are two key drivers of growth expectations. Buy a Half

International Business Machines (IBM) shares were up 7.2% this week as the company recently reported 9% quarterly revenue growth. This week it launched the IBM Defense Model, a purpose-built AI model designed with intelligence provider Janes to deliver reliable intelligence for defense and national security. Buy a Half

Visa (V) shares were again steady this week as the company weathers skepticism despite 16% compound annual earnings growth over the past decade and 14% growth expected this year. 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 26%. 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

Currently Open

ETFs

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