Cabot Prime Pro Week Ending December 18, 2020
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, Mike Cintolo continues to sing the same tune — he’s mostly bullish (especially on the longer-term) and is buying, but as things are a bit hot and heavy, he’s been piecing into stock (usually with smaller) positions and adding as he develops profits. Today he goes over some potential setups (mostly if we get a pullback or some sideways action), including names in a variety of sectors. Stocks mentioned include Z, RDFN, FND, FIVE, BILL, PDD, CLF, XME, PENN, SMAR, and PLAN.
UPCOMING CABOT EVENTS:
Cabot Retirement Club Member Call - December 2020
FREE WEBINAR FOR PRIME MEMBERS ONLY: December 22, 2020 Sign up now.
Cabot Micro-Cap Insider Member Call - January 2021
FREE WEBINAR FOR PRIME MEMBERS ONLY: January 14, 2021 Sign up now.
Advisory Services
Cabot Growth Investor
Special Report December 17: Cabot’s 10 Favorite Low-Priced Stocks for 2021 (look for it in the Special Report Section)
Bi-weekly Issue December 17: We’re past the halfway point in December, which means many of us have other things on our minds, be it getting out the snow shovel (a foot of snow hit the ground here last night), buying last-minute gifts or perfecting your favorite eggnog-based drink. We hope you and yours have a wonderful holiday season. As for the market, not much has changed with the evidence: When it comes to rubber-meets-the-road things like the trends of the major indexes, the price/volume action of leading stocks and the amount of abnormal action out there (very little), there’s no question the bulls are in control. In the Model Portfolio, Mike started a new half-sized position in CrowdStrike (CRWD) last week, and in today’s issue, we’re going to fill out our stake in NovoCure (NVCR) by purchasing another half.
Bi-weekly Update December 10: Stick with the game plan of putting some money to work as opportunities arise. While the near-term path is a bit of a tossup, the major evidence remains bullish, and we’re seeing more and more leaders get moving in recent weeks. Tonight, we’re going to start a new half-sized position (5% stake) in CrowdStrike (CRWD), leaving us with around 25% in cash. We’re also moving Novocure (Buy a Half) and Twilio (Buy) into the Buy column, preferably on dips.
Other Stocks of Interest November 5: Follow ups to stocks featured July 2, 2020 (issue 1449) to November 5, 2020 (issue 1458). Since many of the stocks written about in Other Stocks of Interest don’t make their way into the Model Portfolio, you won’t see them followed on a regular basis in the issues. However, we are monitoring these stocks, and this listing gives you a quick view of our latest thoughts.
Cabot Top Ten Trader
Movers & Shakers December 18: As we cruise toward the holiday season, it’s been another good week for the market—as of this morning, the S&P 500 is up nearly 2% while the Nasdaq, S&P 400 Midcap and S&P 600 SmallCap (now up seven weeks in a row!) all are up in the 2.5% to 3% range. Mike’s Buy ideas today are: Albermarle (ALB) and Sonos (SONO). Mike also suggests selling five stocks this week.
Weekly Issue December 14: The main worry is that few investors are worried (in stark contrast to earlier this year, when the market was kiting higher but few believed it), which tells us that risk is rising. Thus, we remain bullish and think putting money to work is the best course of action, but it’s also important to keep your feet on the ground and focus on the best-looking stocks while trailing stops higher and taking partial profits as things stretch higher. Mike’s Top Pick is Axon Enterprise (AAXN), which continues to gain sponsorship and has just tightened up nicely for five weeks.
Cabot Options Trader and Cabot Options Trader Pro
Note that the current week’s Weekly Update, earnings updates, position updates and stocks on watch are posted on the website in the Market Update section, which is deleted each week.
Cabot Options Trader Basic and Pro Trade Alert December 17: Covered Call: Buy Palantir (PLTR) Stock and Sell the January 24 Call (exp. 1/15/2021) for a net price of $22.5 or less.
Cabot Options Trader Pro & Basic Stocks on Watch December 16: Jacob is intrigued by Advanced Micro Devices (AMD) after a series of call buys yesterday.
Cabot Options Trader Pro & Basic Stocks on Watch December 16: Jacob is intrigued by Stocks on Watch – Microsoft (MSFT) and Apple (AAPL). Not only are these two of the biggest of the old-reliable tech stocks, but these trades indicate to me an increasingly bullish bias for the market and big tech overall.
Cabot Options Trader Basic and Pro Trade Alert December 15: Sell Half of Existing Position: Sell Half of your Apple Inc. (AAPL) April 125 Calls for $11.50 or more.
Cabot Options Trader Pro & Basic Update December 14: This afternoon my options scanning tool picked up on an interesting trade in Zillow (Z) that highlights how hedge funds/intuitions can use LEAPs to trade hot stocks like Z.
Cabot Options Trader Basic Weekly Update December 14: For the first time since the election the three leading indexes came under several rounds of selling pressure last week as negotiations over a coronavirus relief deal stalled, and virus numbers spiked across the U.S. For the week the S&P 500 fell 1%, the Dow lost 0.6%, and the Nasdaq slid 0.7%.
Cabot Options Trader Pro Weekly Update December 14: Long positions: AAPL, CGC, GM, MSFT, NET, UBER, QCOM, SNAP, SONO, TSM, ZNGA. Short position: QQQ December Put
Cabot Undervalued Stocks Advisor
Weekly Update December 16: It’s been said that the four most dangerous words in investing are “this time, it’s different.” The stock market’s behavior is clearly pointing to things being different this time. In mid-day trading on Tuesday, shares of Chinese search engine company Baidu (BIDU) surged 10% (adding $5 billion in market value) on news that it is considering making its own electric vehicles. Private equity-backed Group Nine Media is exploring creating a SPAC (special purpose acquisition company, which raises money as a public company to buy as-of-yet-unnamed targets) to fund acquisitions of its competitors. Bruce has no portfolio changes this week.
Monthly Issue December 3: Stocks have surged this past month, with the S&P 500 returning 11% in November. Other major indices, including the Dow Jones Industrial Average and the Nasdaq Composite, produced similarly strong returns. These kinds of returns would make a good year in most investors’ eyes. For the year-to-date, the S&P 500 has generated a 14% return – a very respectable gain for any year. That it occurred in a year like 2020, with a global pandemic that shut down much of the economy, a domestic presidential change-over, social unrest, and countless other unusually disruptive events is truly remarkable. Bruce has one portfolio change today: Broadcom (AVGO) – from Hold to Sell.
Cabot Stock of the Week
Weekly Issue December 14: The overall investing environment remains quite positive, with all major indexes in strong uptrends as we head toward the end of the year—and the closer we get to that turning point, the better the odds that investors will delay selling winners until next near. Tim’s featured stock is CrowdStrike (CRWD), whose Falcon platform we think will be a must-have solution for most blue chip firms (and thousands of others) in the years ahead—in effect, CrowdStrike has the makings of another ServiceNow, Salesforce.com or Workday. Tim has one portfolio change: Novocure (NVCR) to Sell.
Cabot Global Stocks Explorer
Bi-weekly Update December 17: The Explorer portfolio did well this week, led by an explosive 44% surge by LogiQ (LGIQ), and as we head into the final two weeks of the year, opinions on markets are all over the map. The hyper-charged recent IPOs have some investors on edge while the Fed statement today that it will keep buying government bonds until it sees “substantial” improvement is reassuring to many. Carl will be watching today’s FedEx (FDX) third-quarter earnings report, with Wall Street expecting $4 a share in earnings on over $19 billion of revenue, compared to year-ago numbers of $2.51 EPS on just over $17 billion of revenue. MP Materials (MP) moves from Buy to Hold.
Bi-weekly Issue December 10: A stimulus bill looks like it is right around the corner but we need to get through this winter before vaccines are widely available. Facebook faces a real challenge to break it up and accept legal liability for content. An EU-China summit is cancelled after China tried to limit speakers critical of China’s clampdown of Hong Kong. On the Explorer front this past week, MP Materials (MP) and NovoCure (NVCR) were particularly strong as Sea Limited (SE) briefly made a new high at 200. As promised, our new idea this week hails from Brazil and is a monopoly play on the most essential of all resources.
Cabot Small-Cap Confidential
Weekly Update December 17: The market continues to grind higher and the small cap index, which we haven’t talked about in forever, is finally opening up some white space above its pre-pandemic high. In fact, the S&P 600 Small Cap Index is, at this very moment, trading at an all-time high. It has taken two years!! If that’s not a good reason to celebrate, I don’t know what is. We don’t talk much about the small cap index anymore because it’s chock-a-block full of slower growth and value stocks, so it’s not very representative of the types that we invest in. Plus, as you’ve likely noticed, since we hold a lot of stocks for years, our best performers aren’t really small caps anymore. Many are in mid-cap territory. Tyler has no portfolio changes.
Monthly Issue December 3: Tyler’s new recommendation, Personalis (PSNL) is a cancer genomics company offering next-generation sequencing (NGS) solutions and data analysis services to support personalized cancer vaccine and cancer immunotherapy development. It also provides sequencing and data analysis to support population sequencing initiatives. Personalis has a market cap of $1 billion. Customers of cancer genomic services are primarily pharma and biotech companies, universities and non-profits. Customers of population sequencing initiatives are primarily government entities, led by the U.S. Department of Veterans Affairs (VA).
Cabot Dividend Investor
Weekly Update December 16: With Christmas just a little over a week away, the market tends to go into a holding pattern. It’s a lot like the last weeks of the summer. Investors tend to focus on other things while the market continues in the same fashion as it did right before people stopped paying attention. The market is in a place of trending slightly higher, albeit at a much slower pace than in November. The main story is still the vaccine. As a coronavirus vaccine is now being distributed, the end of the pandemic and ensuing full economic recovery is around the corner. A booming recovery awaits in the New Year. Click here to listen to the podcast. Tom has rating changes for AbbVie (ABBV) and Digital Realty (DLR).
Monthly Issue December 9: The vaccine is changing everything. Stocks that had been left for dead by the market recovery are springing back to life and leading the market higher. One area of opportunity ahead of the New Year is in banks stocks. As a cyclical sector, banks took it on the chin during the pandemic. They crashed during the bear market and have lagged the recovery. But they are rising fast and have great momentum ahead of what looks to be a promising year for the sector. In this issue, I highlight one of the very best and most profitable banks in the country, U.S. Bancorp (USB). It still sells at a great value, pays one of the highest dividends in the industry and now has solid upward momentum.
Cabot Marijuana Investor
Weekly Update December 16: Marijuana stocks as a whole pulled back normally over the past week, but the correction may have ended yesterday, with most of the leaders still well above their 50-day moving averages—and the best have continued to hit new highs. Bottom line, the trend remains up and thus I’m keeping our portfolio fully invested. The big news in the industry this morning was that two of the major Canadian producers are merging, in a deal that will create (at least for now) the world’s biggest marijuana company as measured by revenues. Specifically, Aphria (APHA) and Tilray (TLRY) will combine in an all-stock deal.
Monthly Issue November 25: And good news abounds. First came the election, in which voters in all five states that voiced their opinions on the issue voted for legalization. Then came the quarterly reports, which revealed that business is booming in the marijuana industry. And now we have news of vaccines, which will speed economic reopening. The portfolio has three changes this month. GrowGeneration (GRWG) to Hold. Innovative Industrial Properties (IIPR) to Buy. Village Farms International (VFF) New Buy.
Cabot Early Opportunities
Monthly Issue December 16: The rumblings about stocks, and growth stocks in particular, getting overheated have gotten louder in December, thanks in no small part to the huge performance of IPOs like DoorDash (DASH), Snowflake (SNOW) and AirBnb (ABNB), and the lofty valuations that many growth stocks have been able to sustain so far. Rumblings don’t always translate to a correction. And in fact, questioning outstanding performance is generally a good thing. But still, the point is that investors should not get complacent. There is always a correction coming at some point and it’s best to realize that so when it comes, you’re not surprised. It’s just part of investing. Overall, Tyler recommends keeping two hands on the wheel, two eyes on the road, and proceed cautiously. Today’s Top Pick is Array Technologies (ARRY), which went public in October and has a market cap of $4.9 billion, is one of the world’s largest manufacturers of ground-mounting systems used in utility-scale solar energy projects.
Cabot Profit Booster
Update December 18: The expiration of our December covered calls is today, and Jacob is happy to report that four positions (GM, PINS, YETI, CGC) are closing for max profits ranging from 7.69% to 12.15%, while our one trade that went sideways in November (MRVL), I was able to adjust, and turn into a respectable yield of 3.44%.
Weekly Issue December 14: This Friday is the expiration of our December covered calls, and Jacob is happy to report that all five of our positions are in good/great shape. Since our last covered call idea, last Tuesday, the market has become a bit rockier – not a terribly surprising development given the rapid rise in the indexes since the November election. These market wobbles, and intense sector rotations, are totally normal, but also re-enforce our efforts to own a diverse portfolio of stocks. Which brings me to this week’s idea.
Cabot Micro-Cap Insider
Weekly Update December 16: As we approach Christmas, its important to remember that performance of the stock market tends to be quite strong around holidays. This week Rich has a couple updates. There has been some strong insider buying at Liberated Syndication (LSYN). As such, we are increasing out buy limit to 4.25. Also, MamaMancini’s (MMMB) reported earnings. The report was in line with expectations and doesn’t change our thesis on the stock.
Monthly Issue December 9: Today, Rich believes sentiment indicators continue to suggest the market may be due for a pullback. The Citi Panic/Euphoria model suggests sentiment is high right now. Rich’s new recommendation FlexShopper (FPAY) is a rapidly growing company in the virtual lease-to-own market. Despite rapid growth and margin expansion, it is only trading at 5.0x forward earnings. Importantly, the Chairman of FlexShopper owns over 20% of the company and has been buying more stock as fast as he can in the open market. Rich sees 100%+ upside over the next year. Please read the issue for more recommendation updates.
Cabot Income Advisor
Weekly Update December 16: The market has leveled off a bit since the fabulous November rise. That’s okay. The market can’t go up that fast for long. It needed a breather and this is healthy. And the basic story still hasn’t changed. The vaccine is now being distributed. It should end the pandemic sooner rather than later. The ending of the lockdowns and restrictions will prompt a full recovery in 2021. That vision is keeping stock prices high and will likely drive the market higher next year.
Monthly Issue November 25: It’s another week and another vaccine rally for the market. For the third straight week, a company has announced positive trial results for a coronavirus vaccine. The market loves it every time. The major indexes are now at or very near all-time highs. This market is great. But it’s also tricky here. You don’t want to sell anything while the market is still flying higher with great momentum. But it’s also tough to buy anything after prices have risen so high. Tom has one new featured stock U.S. Bancorp (USB) and multiple portfolio changes.
Cabot Turnaround Letter
Weekly Update December 18: It was a quiet week, with no companies reporting earnings (no earnings reports scheduled for the rest of the year, in fact) and no changes in ratings. We had three price target increases, for Trinity Industries (TRN), Adient (ADNT) and DuPont (DD). To listen today’s podcast and view the latest Catalyst Report click here.
Monthly Issue November 25: This month Bruce looks at year-end selling pressure. Tax-loss selling is one source of artificial selling pressure. Taxable investors will pay federal taxes on their profits at rates as high as 37%, and likely more when state taxes are factored in. These investors have a strong incentive to sell their losers to offset these gains, thereby reducing their tax bill. Bruce’s has one buy recommendation: Xerox Corporation (XRX) and three sell recommendations: Barrick Gold (GOLD), Peabody Energy (BTU),Weyerhaeuser (WY).
Wall Street’s Best Investments
Daily Alert December 18: Innovative Industrial Properties, Inc. (IIPR) Cabot Marijuana Investor
Daily Alert December 17: Plug Power Inc. (PLUG) IThe Chartist
Daily Alert December 16: Ionis Pharmaceuticals, Inc. (IONS) The Medical Technology Stock Letter
Daily Alert December 15: Smartsheet Inc. (SMAR) Canaccord Genuity Research
Daily Alert December 14: SELL: Griffon Corporation (GFF) Upside
Daily Alert December 14: SELL: Channel Advisor Corporation (ECOM) Upside
Daily Alert December 14: BUY: Avid Technology, Inc. (AVID) Upside
Monthly Issue December 17: Despite all the challenges, the markets have held up very well, and the Dow Jones Industrial Average has surpassed the big 30,000 mark several times in the last few weeks. Unemployment continues to decline, with the rate dropping to 6.7% in November. Consumers are shopping for the holidays, with online Thanksgiving sales up 21.5%, to $5.1 billion. I know my finger is sure hitting the ‘buy’ button a lot more this year! Hopefully, 2021 will remove some of the uncertainties that the virus has wrought, and the economy can begin to speed up its recovery. And while the markets have done very well this year, there are still pockets that are undervalued, many of which are represented in our pages this month. Nancy begins this issue with our Spotlight Stock, Companhia de Saneamento Básico do Estado de São Paulo – SABESP (SBS) the largest water company in Brazil, which is expanding to deliver services outside its borders. In Nancy’s Feature article, she further explores that growth—as well as the rising need—for potable water in Latin America.
Ask the Experts
Cabot Profit Booster
Question: I have only been trading options since June and VERY much in the learning mode. This week you started to list cover call ideas with expiration dates several months out. What has changed ? In the future do you see lower premiums and want to capture higher premiums now?
Jacob:Very savvy that you picked up on that. As the market rises, and perhaps the odds of a pullback also rise, I’ve been “recommending” longer dated options that have higher premiums. Essentially, I’m giving us more room should the market get hit (not predicting that, but building in some cushion just in case).
Cabot Stock of the Week
Question:In your recent newsletter, you commented how amateur investors would want to own Tesla and this would not bode well for the short term prospects of the stock. I don’t understand the thought, as I would think this would drive up the price if amateur investors are buying it?
Tim: Thanks for asking. The problem is that amateurs are typically last to act. They’re the last to buy, which creates tops. (The pros have bought earlier and are taking profits when stocks—and risk—are higher.) And they are the last to sell, which creates bottoms. (The pros have sold earlier, and thus have cash to buy at bottoms when amateurs are selling.) This is simplistic, but it’s based on human nature, and that is remarkably consistent over time.TSLA has had a huge run this year. The news is all good, with the company’s profits growing fast and the stock being added to the S&P 500 and other automakers finally jumping on the electric bandwagon.. Some profits will be taken as the calendar rolls over (pushing capital gains taxes out a year) and the odds are not good for amateurs who buy near year-end.I could be wrong, of course. TSLA could keep climbing. And I will not argue with the trend. But I would prefer to buy a less popular stock that has more upside potential, in part because people are still skeptical about it (SPCE for example).
Quarterly Cabot Analyst Meeting
The recording of the Cabot Prime Members Meeting with the Analysts from October 21, 2020 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 Pro 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.
| Stock | Cabot Small-Cap Confidential | Cabot Global Stocks Explorer | Cabot Growth Investor | Cabot Marijuana Investor | Cabot Stock of the Week | Cabot Undervalued Stocks Advisor | Cabot Dividend Investor |
|---|---|---|---|---|---|---|---|
| ABBV | Hold | ||||||
| ACCD | Hold | ||||||
| APT.AX | Buy 1/2 | ||||||
| ARNA | Buy | ||||||
| AVLR | Hold | ||||||
| BABA | Hold 1/2 | ||||||
| BGS | Buy | Hold | |||||
| BIP | Buy 2/3 | ||||||
| BLFS | Buy | ||||||
| BMY | Buy | ||||||
| BSCL | Buy 1/2 | ||||||
| CDLX | Hold | ||||||
| CGC | See Advisory | ||||||
| COLM | Buy | Buy | |||||
| CRLBF | See Advisory | ||||||
| CRNC | Buy | ||||||
| CRWD | Buy 1/2 | Buy | |||||
| CSCO | Buy | ||||||
| CURLF | See Advisory | ||||||
| DLR | Sell | Hold | |||||
| DOW | Hold | ||||||
| EPD | Buy | ||||||
| EQH | Hold | ||||||
| EVBG | Buy | ||||||
| FIVE | Buy | ||||||
| FVRR | Hold 3/4 | ||||||
| GM | Hold | Hold | |||||
| GRWG | See Advisory | ||||||
| GSHD | Hold 3/4 | ||||||
| GTBIF | See Advisory | ||||||
| HALO | Buy 1/2 | ||||||
| HTHT | Hold | ||||||
| IIPR | See Advisory | Hold 2/3 | |||||
| INSP | Hold 3/4 | ||||||
| JBLU | Buy | ||||||
| JUSHF | See Advisory | Hold 2/3 | |||||
| KO | Buy | Buy | |||||
| KPTI | Buy | ||||||
| LGIQ | Buy 1/2 | ||||||
| LLY | Buy | Buy | |||||
| MO | Buy | ||||||
| MP | Hold | ||||||
| MRK | Buy | ||||||
| NEE | Hold | Hold 1/2 | |||||
| NEO | Buy 1/2 | ||||||
| NET | Hold 1/2 | ||||||
| NUAN | Buy | ||||||
| NVCR | Buy | Buy Another 1/2 | Buy | ||||
| O | Buy | ||||||
| PGX | Hold 1/2 | ||||||
| PINS | Buy | Buy | |||||
| PSNL | Buy | ||||||
| QCOM | Buy | Hold 2/3 | |||||
| QTWO | Buy | ||||||
| RGEN | Buy | ||||||
| ROKU | Buy | ||||||
| RPAY | Sold | ||||||
| SE | Hold 1/2 | Hold | |||||
| SOLO | Buy 1/2 | ||||||
| SPCE | Buy | Buy | |||||
| SPT | Buy | ||||||
| SSO | Buy | ||||||
| STAG | Hold 1/2 | ||||||
| TAP | Buy | Buy | |||||
| TCNNF | See Advisory | Hold | |||||
| TMX | Buy | ||||||
| TPB | See Advisory | ||||||
| TRSSF | See Advisory | ||||||
| TSLA | Hold | ||||||
| TSM | Buy 1/2 | Buy | |||||
| TSN | Buy | ||||||
| TWLO | Buy | ||||||
| UBER | Buy | Buy | |||||
| VIAC | Buy | ||||||
| VLO | Buy | ||||||
| VZ | Hold | ||||||
| XEL | Buy 2/3 | ||||||
| ZM | Hold |