Please ensure Javascript is enabled for purposes of website accessibility
Cabot Prime Pro Logo
Cabot Prime Pro

Cabot Prime Pro Week Ending May 28, 2021

Cabot Prime Pro Week Ending May 28, 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, Mike Cintolo talks about the market’s constructive week, with more positive action among individual stocks and indexes, and even some bullish earnings moves. He doesn’t think we’re out of the woods, but if the market can build on the past couple of weeks, this rally could be the real McCoy. Stocks mentioned include ZS, SHOP, TWLO, ARKK, PINS, RBLX, APP, NVDA, W, LRCX, CRWD, ALGN, and GS.

UPCOMING CABOT EVENTS:

Cabot Micro-Cap Insider Member Call

FREE WEBINAR FOR PRIME PRO MEMBERS ONLY: June 10, 2021 Sign up now.

Contrarian Stocks for a Momentum World

FREE WEBINAR FOR PRIME PRO MEMBERS ONLY: June 17, 2021 Sign up now.

Advisory Services

Cabot Growth Investor

Bi-weekly Update May 27: Stay cautious, but it’s OK to do a little buying. The evidence has improved of late, and given our huge cash position, that’s enough to tip-toe back into the market. That said, we consider the past few sessions as a good first step or two, but there’s a lot more work to be done before growth stocks are really in gear. Tonight we’ll add half-sized positions in both Progyny (PGNY) and Roblox (RBLX)—both are smaller and volatile (especially RBLX), but both also look like potential new leaders if the market kicks into gear. We’ll give them rope and we’ll still be holding around 60% in cash even after the buys.

Bi-weekly Issue May 20: It’s been a downer of a three months for growth stocks, so we want to start with a positive note, partially in response to some worried questions we’ve started to get as the sellers really dug in their heels last week: Longer term, we remain as optimistic as ever that this bull market (yes, even in growth stocks) has a long way to run. Part of that is our still-bullish Cabot Trend Lines (bullish for more than a year now), but a lot of it comes from a study we write about later in this issue.

Cabot Top Ten Trader

Movers & Shakers May 28: It’s been another constructive week for the market in our view. The major indexes have perked up, with all five that we track back above their 50-day lines. That’s not the be-all, end-all, but there’s been improvement. Better yet, growth stocks have had another good week—glamour funds like the ARK Innovation Fund (ARKK) are up nicely (though still way, way off their highs), and we’re seeing more solid action, meaning big-volume moves and some positive reactions to earnings.

Weekly Issue May 24: After a couple of horrid weeks for growth stocks, we’ve seen a ray of light lately, as many found solid support with some volume beginning to show up in some stocks as they rally, an early sign that big investors are engaged. Mike’s Top Pick is Analog Devices (ADI), which has come back to life after a three-month rest thanks to great earnings, huge cash flow and a pending acquisition.

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 Pro & Basic Earnings Preview May 27: This afternoon after the close Gap (GPS) will report earnings. Headed into the announcement we have taken partial profits on half of our position, and the balance of our calls are at a potential profit of approximately 20%.

Cabot Options Trader Pro & Basic Sector Rotation May 26: Yesterday we bought a longer-dated position in Boston Scientific (BSX) as the med-tech stocks looked strong and option activity was bullish. Today med-tech stocks are down, including BSX (Of note, into this small BSX pull back a trader bought another 4,000 of the June 44 Calls for $0.45. Jacob continues to be intrigued as to what this trader is targeting this month for BSX stock).

Cabot Options Trader Pro & Basic Trade Alert May 25: Buy the Boston Scientific (BSX) November 43 Calls (exp. 11/19/2021) for $3.60 or less.

Cabot Options Trader Pro Weekly Review May 24: Long positions: XLF, DKNG, F, GPS, CGC. Bearish positions: SPY

Cabot Options Trader Basic Weekly Review May 24: Last week’s stock market action featured more of the same: A lot of churning and fierce rotation between growth and cyclical stocks. The tug-of-war resulted in not much progress for the major stock indexes with the Nasdaq Composite gaining 0.2%, while the S&P 500 dropped 0.4% and the Dow Jones Industrial Average fell 0.5%.

Cabot Undervalued Stocks Advisor

Weekly Update May 26:We’ve written about inflation in the past two letters and promise that we’ll stop with this letter, unless some major news on this front emerges. Yet, what keeps us on the topic is commentary from brokerage firms and media outlets saying that the market is fully discounting the arrival of inflation. If inflation is here to stay, at perhaps a rate greater than, say, 3-4%, then the market is not discounting its arrival. Bruce has one new Buy: Otter Tail Corporation (OTTR).

Monthly Issue May 5: While the year-to-date 11.8% surge in the S&P 500 (helped by a 5.3% jump in April) has been impressively strong, the 40% annualized pace seemed unlikely to continue, at least without interruption. May hasn’t started out quite so exuberantly, with an early pull-back in the high-momentum tech stocks dragging down the broader indexes. The immediate catalyst appears to be Treasury Secretary Yellen’s comments on Tuesday that interest rates may need to increase to ward off inflation. Bruce has no portfolio changes.

Cabot Stock of the Week

Weekly Issue May 24: The bull market that began in March 2020 remains in effect, though showing signs of age. Growth stocks in particular have continued to struggle. But some (particularly newer ones) are showing signs of accumulation, and that’s our focus today, with a recent IPO that has just broken out to new highs. Tim’s featured stock Roblox (RBLX), offer countless 3D worlds that allow users to play and generally goof around with their own unique 3D character for free, though many spend also spend a ton of money on avatars and digital items to boost their character. The company calls it “human co-experiences” and it’s a new form of social interaction.

Cabot Explorer

Bi-weekly Issue May 27: The Dow Jones index began on May 26, 1896 with 12 companies, including the likes of American Cotton Oil and Distilling & Cattle Feeding. The storied index expanded to 20 stocks in 1916 and 30 stocks in 1928. It has increased an average of 7.7% each year, according to Dow Jones Market Data. It climbed above 100 in 1906, reached 1,000 in 1972 and passed 10,000 in 1999. Carl’s new recommendation Palantir Technologies (PLTR),is a software company specializing in big data analytics. Peter Thiel and a few others from the PayPal mafia founded Palantir in the early 2000s. Its software is used by government agencies in a wide range of applications and the company sees plenty of room to expand into the commercial sector.

Bi-weekly Update May 20: Markets are a bit jittery despite strong earnings and expected strength as America opens up its post-pandemic economy. China is already at a 5% growth path while India, Japan, and other important economies struggle to get the pandemic under control. It has been extraordinary to see Larry Summers pushing back on President Biden’s stimulus and infrastructure plan as well as the Fed’s expansionary policy. Since his opinions carry weight, this will be a real fight. Although Fed officials have said the economy is still in recovery mode and requires stimulus from the central bank, that prospect has led tech stocks and other riskier assets to wobble in recent weeks.

Cabot Small-Cap Confidential

Special Bulletin May 28: Yesterday I mentioned that I would follow up today with notes from the Thunderbird Entertainment (TBRD.CA, THBRF) earnings call. Here are a few tidbits from that call. There was a lot of talk about inclusivity and diversity on the call, both in terms of people and partners working for/with Thunderbird as well as the types of content the company seeks to produce and the messages it seeks to deliver.

Weekly Update May 27: Well, it’s about time some buyers showed up. While we can’t yet characterize the move in higher growth small- and mid-cap stocks as a rally per se, it’s not premature to say that sentiment has turned up when it comes to these types of stocks. Looking at the broad market indices, the S&P 500 has recovered from a 4% dip to trade near all-time highs, the Dow is just 2% off its high and the Nasdaq is two weeks into a recovery from a 9% drawdown and now sits 3% off its previous high. Tyler is moving Q2 Holdings (QTWO) to a Buy.

Monthly Issue May 6: Tyler’s new recommendation Thunderbird Entertainment (THBRF), is a Canada-based multi-platform, media production, distribution, and rights management company. The company’s programs span a variety of genres, but it is particularly focused on children’s productions, scripted comedy and drama, and non-scripted (factual) content. Thunderbird’s programs are currently available on broadcast and cable channels within the U.S., Canada and other countries, as well as on most of the major digital platforms, including Apple TV+, Disney+, Netflix, HBO Max, Hulu, Netflix, Peacock and PBS Kids.

Cabot Dividend Investor

Weekly Update May 26: The market is in nowheresville. The S&P 500 is at the same level it was in early April. But the index isn’t really down. It’s only 1% below the all-time high. It’s not that the market is going down. It just stopped going up. That’s okay. Stocks couldn’t keep up the recent pace of ascent. The market needed to take a breather. Usually, you get a 5% or 10% correction in the consolidation after a big run higher. This is nothing. The consolidation period is just as impressive the surge.

Monthly Issue May 12: Despite the past couple of days, the market indexes are still close to all-time highs. Stocks have soared at an amazing pace over the last year and the past several months. A promising environment of a booming economy complemented by trillions in stimulus still lies ahead. But how much of that wonderful news is already priced in? Tom’s featured stock ONEOK Inc. (OKE), is a large U.S. midstream energy company specializing in natural gas. Tom has two portfolio changes.

Cabot Marijuana Investor

Monthly Issue May 26: The good news is that quarterly reports from our marijuana companies continue to reveal an industry that’s booming. The figures below, reflecting the latest report from each company, show an average revenue growth rate, year-over-year, of 158%! And if you take out the three non-plant-touching companies, which are there to provide a bit of stability and diversification, as well as the lone remaining Canadian company, you get an average of 204%. That’s fast!

Weekly Update May 19: The five “real” plant-touching stocks that look healthy here are Columbia Care (CCHWF), Cresco Labs (CRLBF), Green Thumb (GTBIF), Jushi (JUSHF) and TerrAscend (TRSSF). TerrAscend looks strongest of all, as it is above both its 25- and 50-day moving averages. Going forward, if more stocks fall below that low, Tim may recommend more selling. But right now, he is standing pat, with the portfolio 29% in cash, and optimistic that the stage is being set for the next advance.

Cabot Early Opportunities

Monthly Issue May 19: If you want to strike up conversation at your next social gathering just utter one of two sentences. “Hey, have you guys heard about lumber prices? Holy cow!” Or, “Man, I think inflation is here to stay. Prices on everything are going up and there’s no end in sight.” Tyler’s Top Pick Fox Factory Holdings (FOXF), makes suspension and other parts, including side-by-side vehicles, all-terrain vehicles, snowmobiles, motorcycles, and other specialty vehicles.

Special Bulletin May 14: This may just go down on record as one of the worst earnings seasons ever for growth stocks. Two weeks ago, things were “fine.” Since May began, not. Inflation is the bogeyman spooking investors and his shadow has crept out from below desks and up the walls of those with growth-heavy portfolios. The sell orders picked up steam early this week, and while the last two days have been far better, the divergent action between growth stocks (cloud, MedTech, Internet, etc.) and other areas of the market is crystal clear.

Cabot Profit Booster

Weekly Issue May 25: Despite the market trading down/sideways the past month the Cabot Profit Booster portfolio has had a fairly strong May. Jacob’s new stock recommendation is Progyny (PGNY).

May Expiration May 24: On Friday our five May covered call positions expired. The GT and MTDR calls finished in-the-money leaving us without a stock or option position and our full profits. The CLF, LEVI and HOG calls we sold finished out-of-the-money leaving us with a stock position today, and no option position. This morning we are going to sell our stock positions in CLF, LEVI and HOG. After these stock sales we will no longer own a stock or option position in any of these stocks.

Cabot Micro-Cap Insider

Weekly Update May 26: When Rich originally recommended BBX Capital (BBXIA), he noted that he was a little worried about poor historical corporate governance. Specifically, the Levan family controlled (and still does) the majority of voting shares of the company and as a result, had complete control over executive compensation (executive compensation has historically been high). However, he ultimately got comfortable buying the stock because the Levan family owned 42.2% of class A shares and had more to gain from increasing the value of the company than from milking it for excessive executive compensation. And that was a good decision as the stock is up over 100% since he recommended it.

Monthly Issue May 13: Rich’s new recommendation Drive Shack (DS), is a modern take on driving ranges. Each Drive Shack Venue features expansive, climate-controlled, suite style bays with lounge seating; augmented-reality golf games and virtual course play; a restaurant and multiple bars; an outdoor patio with lawn games; and arcade games. See below for the view from a bay at a Drive Shack location. Drive Shack’s traditional and entertainment golf businesses are set to boom in 2021. Given substantial recent cost cuts, operating leverage should drive earnings growth in 2021 and beyond. Longer term, growth will be driven by new Puttery Venues, which have high potential.

Cabot Income Advisor

Monthly Issue May 26: It looks like this relentless bull market is finally stalling out. The market isn’t correcting, or really selling off in any substantial way. It has just stopped moving higher, for now. Given the returns in the past year and recent months, the market had to take a break. That pace couldn’t last. Tom’s featured stock ONEOK Inc. (OKE), is a large U.S. midstream energy company specializing in natural gas. It owns one of the nation’s premier natural gas liquids (NGLs) systems and also has an extensive network of natural gas gathering, processing, storage and transportation assets.

Weekly Update May 19: The market is still in an uptrend and not far from the highs. But things are changing. The market had a fairly steep selloff over the first three days of last week but then recovered over the last two days. This week it’s been wobbly. The issues are supply problems and inflation. While the economy is delivering on the booming growth, supplies can’t keep up. Businesses can’t find workers to hire. Housing supply is at a four-decade low. Industry-wide chip shortages are hurting technology and automobile sales.

Cabot Turnaround Letter

Weekly Update May 27: Activist activity stepped up in May, as did CEO turnover. Also, three companies emerged from bankruptcy. While the volatility in tech stocks, Bitcoin and SPACs dominates the headlines, these below-the-radar catalyst-driven companies offer worthwhile ideas that could provide strong returns regardless of the market environment. With proxy season winding down, activist activity may take a breather in June, although we anticipate steady mergers/acquisition news and CEO replacements. Click here to listen to the podcast.

Monthly Issue May 26: Good investment ideas can come from anywhere. One useful source is to borrow ideas from like-minded investors. While major institutional investors want to keep their best ideas secret, they are required by the Securities and Exchange Commission to file regular reports that disclose their holdings. Once disclosed, anyone can view them. Several online aggregators provide convenient access to these reports. Bruce’s has one buy recommendation: Vistra Corporation (VST).

Special Bulletin May 25: Bruce is moving Jeld-Wen Holdings (JELD) from Hold to Sell. The company is executing on its turnaround, led by the relatively new CEO. However, after our more detailed review of the company’s future prospects, the shares appear to fully discount a robust profit recovery and are trading at our price target. Their Investor Day was uninspiring – while the company is operating much better and has at least a temporary cyclical tailwind, the management is talking about pursuing their growth ambitions, going so far as to outline as much as $4 billion in buying power over the next several years.

Quarterly Cabot Analyst Meeting

The recording of the Cabot Prime Members Meeting with the Analysts from April 21, 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 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.

StockCabot Small-Cap ConfidentialCabot ExplorerCabot Growth InvestorCabot Marijuana InvestorCabot Stock of the WeekCabot Undervalued Stocks AdvisorCabot Dividend Investor
ABBVBuy
ACCDBuy
AGCBuy
AGNCBuy
ARCOBuy
ARNABuy
AVGOHoldBuy
AVLRBuy
AVVIYBuy
BIPBuyBuy 2/3
BMYStrong Buy
BSCLHold
CBTBuy
CCHWFBuy
CGCSee Advisory
CRLBFSee Advisory
CRNCHold
CSCOBuy
CURLFSee Advisory
CVXBuy
DLRBuy
DOWHold
DVNBuy
EPDBuy
EVBGBuy
FIVEHoldHold
FNDHold
FSRBuy
FVRRHold
GMHoldHold
GOLDBuyBuy
GRWGSee Advisory
GTBIFSee Advisory
HTHTHold
HUBSBuy
IIPRSee Advisory
IBMBuy
INSPHold
JUSHFSee AdvisoryHold 2/3
KOBuyBuy
KRNTBuy
LLYHold 2/3
MRKBuy
MRVLBuy
NEEBuyBuy
NETHold 1/2
NGLOYHold
NVCRBuy
NVDABuy
OBuyBuy
OKEBuy
OTTRBuy
PGNYBuy
PGXHold 1/2
PLTRBuy
PRCHBuy
QCOMHold
QTWOBuy
RBLXBuyBuy
RGENBuy
RVLVBuy
SEBuy 1/2Buy
SLBBuy
SLQTSold
SONOSold
SPCEHold 1/2Sold
SPTBuy
SSOBuy
STBuy
STAGHold
TAPHoldBuy
TCNNFSee AdvisoryHold
TPBSee Advisory
TRSSFSee Advisory
TSLAHold
TSMBuy 1/2
TSNHold
USBBuy
VLOHold
VZHold
XELBuy 2/3