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Cabot Prime Week Ending August 13, 2021

Cabot Prime Week Ending August 13, 2021

Stock Recommendation Tracker

The Stock Recommendation Tracker is a table that features all of the current recommendations in all of our portfolios. It’s a quick way for you to see what stocks are currently in our portfolios and will highlight new additions or any changes to our recommendations over the previous week. We include this table at the bottom of the Weekly Summary, and provide a link here at the top to the Stock Recommendations Tracker.

Cabot Weekly Review (Video)

In this week’s stock market video, Tyler Laundon walks investors through nearly 20 stocks that he’s been watching and discusses why they’re reacting the way they are to earnings reports and Delta variant trends. If you’re interested in software, MedTech, small cap and IPO stocks there’s something for you.


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Advisory Services

Cabot Growth Investor

Bi-weekly Issue August 12: The chop factor remains in force in the market, with yet another round of rotation this week out of growth and into the broad market. Even so, we see more good than bad out there, with an increasing number of growth stocks having popped out of multi-month ranges and recent dips mostly looking manageable. In this issue, we write about one sector that’s showing some signs of perking up, some encouraging sentiment readings and go over all of our stocks and many others we’re keeping a close eye on.

Bi-weekly Update August 5: Continue to take steps into the market, but pick your spots and keep some dry powder available. The overall market remains mostly sideways and most stocks are still stuck in the chop (good few days followed by a bad few days), but we’re also seeing more growth stocks act well. We’re making one new addition tonight, adding a full-sized stake in Dynatrace (DT), which will leave us with a still-healthy 30% in cash. Details below.

Special Bulletin July 27: After a nice few days, growth stocks (and the market as a whole) are getting walloped today, a sign that the market hasn’t broken free of the endless chop. To be fair, many growth names are still in good shape, but our Cabot Tides remain on the fence and much of the broad market is flopping around at best. In the Model Portfolio, we put some money to work last week, but today we’re going to punt on one of our weaker names—we’re selling our half-sized stake in Progyny (PGNY) and holding the cash. That will leave us with a cash position around 42%.

Cabot Top Ten Trader

Movers & Shakers August 13: It’s been mostly another rotational week, with investors rotating out of some of the recently strong tech and cloud areas and back into some cyclical areas (especially metals and financials). That said, you didn’t see much in the indexes—all the major ones are up or down within one percent on the week coming into today, but the more focused indexes tell the tale, with things like the ARK Innovation Fund (ARKK) and the Russell 2000 Growth Index (IWO) down nearly 1%, while materials (up 5.6%) and financials (up 2.7%) power ahead.

Weekly Issue August 9: We continue to see more good than bad in the market as an increasing number of growth stocks move into new high ground, many other growth stocks set up nicely and even some cyclical names are getting into the act, rounding out nice launching pads. This week’s list is another chock-full of recent earnings winners and other names showing excellent action. Our Top Pick is Alnylam Pharmaceuticals (ALNY), which has lifted off nicely and has a great story.

Cabot Undervalued Stocks Advisor

Weekly Update August 11: Just reading those words, “climate change,” is almost certain to light up emotions. Regardless of one’s opinions on the degree of urgency and which of a very wide range of proposed policies and actions should be taken, how could words about the end of the world as we know it not ignite emotions? From an investment perspective, of course, it is financially risky to let one’s emotions get entangled in the stock selection and asset allocation process.

Monthly Issue August 4: As value investors, we look for companies whose shares are out of favor. Typically, these companies have little revenue or earnings growth – maybe their product or service offerings are in slow-growth industries or maybe aren’t quite as in-sync with customer demand as competitors, or perhaps they are pharmaceutical companies with patent expirations looming in the future. There are other potential overhangs, such as sub-par margins, poor capital allocation, temporary regulatory or legal issues or involvement in a recent spin-off transaction.

Cabot Stock of the Week

Weekly Issue August 9: While the bull market has struggled in recent months, it is not dead yet. And as second-quarter reports have increasingly been revealing an economy that continues to expand at faster-than-expected rates, buyers have been rewarding a wide variety of stocks, on both the value and growth side. Tim’s featured stock Marvell Technology (MRVL), designs, develops and sells a wide variety of semiconductor products that are at the core of 5G-capable networks, processors and devices as they partner with and transition from 4G to 5G. The company’s embedded processors and products are cutting-edge and already generate $3 billion in annual sales.

Cabot Explorer

Bi-weekly Update August 12: Markets reacted well to yesterday’s inflation data that showed evidence of cooling as the economic recovery continued amid pandemic-related strained supply chains and signs that the recent rise in Covid-19 infections is starting to slow some business activity. This might reverse the recent momentum among industrial and manufacturing stocks that over the last decade or more have been vastly outperformed by tech and financial stocks. The reason is quite simple: The latter have much lower capital requirements plus higher growth rates and profit margins.

Bi-weekly Issue August 5: The paradox of clean tech is that the critical materials needed to produce cleaner electricity – such as cobalt, gallium, lithium, germanium, and rare-earth elements – are far more scarce than petroleum, suggesting that global shortages and strife over vital resources is inevitable. Carl’s new recommendation Novonix (NVNXF), is an Australian technology and advanced materials supplier to the electric vehicle and storage battery industry. Founded by members of a research team at Canada’s Dalhousie University, the company has become an integrated developer and supplier of high-performance materials, equipment, and services for the global lithium-ion battery industry with a focus on North America.

Special Bulletin July 26: Due to escalating regulatory risk by Chinese authorities, please sell Pinduoduo stock. Carl will have more in this Thursday’s update but, in short, the Chinese are exerting their authority on Chinese companies that have used offshore entities to list on U.S. markets. China wants these companies to list in Hong Kong or Shanghai. There may be some trading and arbitrage opportunities developing, but the risk for Pinduoduo is now too high.

Cabot Dividend Investor

Monthly Issue August 11: Markets have a history of being cranky after Labor Day. Will growth concerns be a problem? Maybe inflation will again haunt the market. Right now, the market is in a tug-o-war between the booming economy and growth concerns, primarily being stoked by the delta variant. Tom’s featured stock is Spectrum Brands Holdings, Inc. (SPB).

Weekly Update August 4: The earnings extravaganza is in full swing. It’s the peak of the season that marks the peak earnings growth of this extraordinary recovery. And the market is sort of yawning it off. Part of the issue is summer malaise. People just tend to focus more on enjoying the waning days of summer than stocks this time of year. But it also may be that this quarter just isn’t as important one might expect.

Cabot Marijuana Investor

Weekly Update August 11: With second-quarter reports coming fast and furious, there’s a lot of news this week—but no big surprises, so no changes. Most of our stocks continue to build bases, so I remain patient, waiting for a renewed advance by the sector. The standout stock in our portfolio is Innovative Industrial Properties (IIPR), which broke out to a new high last week after a great report.

Monthly Issue July 28: Tim remains cautiously optimistic that the sector’s uptrend will resume soon; the stocks have fallen far enough, and the fundamentals of the industry remain terrific. But until we see real strength, there’s no reason to be aggressive. The portfolio is already heavily invested, but not fully, and when we do buy more, it will almost certainly be of the strongest stocks, which today are IIPR, GTBIF and GRWG. For now, the one change he will make today is to sell half our position in TerrAscend (TRSSF) and put it into Innovative Industrial Properties (IIPR).

Cabot Early Opportunities

Special Bulletin August 10: Vail Resorts (MTN) and Semler Scientific (SMLR) move to SELL, and 10x Genomics (TXG) moves to SELL A QUARTER.

Monthly Issue July 21: The Fed will need to taper bond purchases at some point and interest rates, at least in a rational market, seem like they can only go up. Yet rates remain low, somewhat confusing the growth vs. value argument (for those that feel a need to go one way or the other). Tyler’s Top Pick Upstart Holdings (UPST), operates a cloud-based artificial intelligence (AI) lending platform that goes beyond simple FICO-based models to better match borrowers and lenders. Upstart-powered banks are better able to identify risk and can generate higher approval rates and experience lower loss rates, while customers enjoy the benefits of a digital-first borrowing experience.

Cabot Profit Booster

Weekly Issue August 10: The bulls continued their winning ways last week, but the advance wasn’t without some jostling. Late in the week several leading growth stocks pulled back, but those declines weren’t enough to keep the bulls from another weekly victory. The S&P 500 gained 0.93%, the Dow advanced 0.78% and the Nasdaq rose 1.11%. To put this market run into perspective, the current rally has lasted 189 days, basically nine months, without a 5% pullback. Additionally, there have been 43 days of a recorded new high. Jacob’s new stock recommendation is ON Semiconductor (ON).

Update July 19: On Friday our MRO and SGMS call positions expired worthless, leaving us with only our stock positions. And while Jacob debated selling new calls to lower our cost basis, the market is weak, and these stocks have fallen below our initial stop levels. For that reason, Jacob is going to sell both MRO and SGMS stock positions today, and prepare to move this capital into better ideas.

Cabot Income Advisor

Weekly Update August 11: The S&P 500 is at a new all-time high. While the market hasn’t been exciting compared to earlier this year, it’s clearly moving the right way. The booming economy is currently winning the tug-o-war with growth fears, largely propelled by the Delta variant, and inflation fears. Earnings have been sensational. A higher percentage of S&P 500 companies have exceeded earnings expectation than ever before. And expectations were sky high.

Monthly Issue July 28: It’s been a sideways summer market for a while. Sure, the indexes have been making a series of new highs. But the S&P 500 is just 1.2% higher than it was in early May. This week inflation is the worry. Last week growth was the problem. The market can’t seem to make up its mind and nothing seems to get any real traction. Any move higher gets tempered by a pullback. Any significant selloff is followed by a quick recovery. But earnings could change things.

Cabot Turnaround Letter

Weekly Update August 13: We made two ratings changes this past week. First, we moved Albertsons (ACI) from BUY to SELL, after its sharp price gain to well above our price target and to a valuation that prices in an optimistic future. ACI shares produced a 94% profit from our recommendation only 13 months ago. And we moved Berkshire Hathaway (BRK/B) from BUY to HOLD. The shares are too expensive to justify additional buying (Warren Buffett seems to agree on this) yet we can’t reasonably justify selling the shares, either.

Special Bulletin August 11: This afternoon we are moving Albertsons (ACI) from BUY to SELL. Albertsons’ shares continue to surge well past our 23 price target. Recent catalysts include more encouraging news that removes much of the pension overhang, strong earnings that point to more build-up of excess cash, and continued concerns over Covid that will help drive consumers back to grocery stores.

Monthly Issue July 28: It’s been a remarkably strong market, not just since the bottom of the pandemic-driven sell-off a little more than a year ago, but over the past decade. The 10-year annualized total return of the S&P 500 was 14.8% at the end of June, one of the strongest decades in history. Shorter-term gains have been even sharper: the 17.7% annualized return over the past five years, which bridges the pandemic sell-off, is simply stunning. Bruce’s has one buy recommendation: Walgreens Boots Alliance (WBA).

Ask the Experts

Cabot Profit Booster

Question: What advantage do we have by staying in the MRVL covered call position? Looks to me the upside is maxed out.

Jacob:There is still another $0.20 left to capture in our trade, though yes, we are running out of profit potential fast (good “problem”).

Quarterly Cabot Analyst Meeting

The recording of the Cabot Prime Members Meeting with the Analysts from July 14, 2021 is now available for you to listen to at your convenience—click here for access. This private call with our analysts is one of your exclusive Cabot Prime member benefits.

Stock Recommendations Tracker

The table below lists all of the stocks held in any Cabot portfolio.
Updated or revised recommendations from the past week are in purple text.
Stocks added to a portfolio are highlighted in green text.
Closed stock positions in the past week are highlighted in red text.

StockCabot ExplorerCabot Growth InvestorCabot Marijuana InvestorCabot Stock of the WeekCabot Undervalued Stock AdvisorCabot Dividend Investor
AGCBuy a 1/2
ASANBuy a 1/2
CCHWFSee Advisory
CGCSee Advisory
CRLBFSee Advisory
CURLFSee Advisory
FSRBuy a 1/2
GRWGSee Advisory
GTBIFSee Advisory
IBMBuy a 1/2
IIPRSee Advisory
JUSHFSee Advisory
MRVLBuy a 1/2Buy
NETHold 1/2Buy a Half
PLTRBuy a 1/2
POAHYBuy a 1/2
PSHZFBuy a 1/2
SEBuy 1/2Buy
SPCEHold 1/2
TCNNFSee AdvisoryHold
TPBSee Advisory
TRSSFSee Advisory
TSMBuy 1/2