June 18, 2025

With the stock market and Cabot’s office closed tomorrow for the Juneteenth federal holiday, this week’s update is coming your way a day early.

The market’s biggest concern at the moment is, of course, the conflict between Israel and Iran. I think it’s impressive how resilient the market has been given these developments in the Middle East.

The takeaway is that investors think the conflict between Israel and Iran will pass soon enough, and when it does, Iran’s military capabilities will be significantly reduced. Granted, the market’s action might change quickly if the U.S. drops a 30,000-pound bunker buster bomb on Iran’s Fordow uranium enrichment plant.

Apparently, the GBU-57 Master Ordnance Penetrator (MOB) bomb can blow things up that are 200 feet underground. It is delivered via a B-2 Spirit stealth bomber, which has the capacity to carry two of these bombs. It was developed for just this type of application.

The other big news, which seems less important once you start thinking about the MOB, is the Fed’s June meeting.

It wraps up today, and Powell will hold a press conference. This meeting includes an updated Summary of Economic Projections (SEP), so there will be a little more analysis than is typical. Analysts will be looking to see if the new dot plot implies two cuts are still on the table for this year, or just one (or three!).

There’s virtually zero chance of a cut today. Which means the Trump administration is sure to start attacking Powell right after the “hold” decision is made. Trump wants cuts, and the Fed is resisting, not wanting to risk inflation coming back.

I’m no economist, but it does seem like a quarter-point cut sooner rather than later would be fine.

In any event, things might get interesting this afternoon given the Fed meeting, a holiday on Thursday, and this business going on in the Middle East.

On to our portfolio.

Recent Changes

None

Updates

Artivion (AORT) jumped to 30 yesterday, the high end of its recent trading range, after Canaccord Genuity announced coverage with a 35 price target and management spoke at the Truist MedTech Conference. A few of the big-picture things worth repeating from that conference talk are that Artivion plays in very specialized areas of aortic-specific grafts, arches, stents and valves. It’s really the leader in these areas and is developing the market for its solutions in the U.S., partially by completing trials in Europe. The multiple pieces of the business add up to a decent revenue stream, and management says EBITDA should grow at about twice the pace of revenue (expected to grow by 10% this year). BUY

AvePoint (AVPT) has moved sideways since last week’s update. Yesterday, the company announced it has added new capabilities to the AvePoint Elements Platform that help managed service providers (MSPs) “…enhance data security offerings, streamline IT management, and provide optimization services at scale”. Management will present at a Northland conference on June 25. HOLD

Axogen (AXGN) was sold last week. SOLD

Byrna (BYRN) has continued to act well since last week’s update and is trading at roughly the same level as it was right after announcing preliminary Q2 results, which were better than expected. Following that press release, B. Riley boosted its price target from 38 to 39. BYRN closed at 31.4 yesterday. BUY

Delcath (DCTH) has pulled back since last week’s update as the stock’s action more or less matches that of the broad-based IHI MedTech ETF. The stock had rallied to new highs after the Q1 report, and management raised full-year guidance, stating that full-year 2025 revenue should be in the range of $94 to $98 million (consensus was $94.1 million). Soon after, HC Wainwright boosted its price target on shares from 24 to 29. BUY HALF

Enovix (ENVX) continues to creep higher and has trended above its 25-day moving average line since late May. The stock’s 200-day line, at 9.2, is just overhead. Another week with no company-specific news as we look for the first smartphone battery purchase order to come in the September to November time frame. There is a second smartphone customer in the pipeline as well. HOLD

FTAI Infrastructure (FIP) stock was upgraded to buy three weeks ago and continues to act well. We just heard early this morning that Nippon Steel has completed its long-awaited on-again, off-again acquisition of U.S. Steel. Nippon Steel will invest about $11 billion in U.S. Steel by 2028, while U.S. Steel will retain its name, remain incorporated in the U.S., and maintain its Pittsburgh headquarters. This may be relevant to FIP because its Transtar rail business was purchased from U.S. Steel and may enjoy more third-party business given this acquisition. When asked by an analyst about what this deal might mean back on the Q1 earnings call, management responded, “…we’ve always said if Nippon is approved or otherwise an investment by Nippon is approved, that can only be a good thing. It’s not necessarily a bad thing for Transtar if it goes the other way, but it’s probably an incrementally good thing if Nippon is approved to make an investment or otherwise acquire U.S. Steel.” BUY

Hannan Metals (HANNF, HAN.CA) shares pulled back this week on no news. We’re awaiting drill results from the first hole (HDDVA001) at Belen, which is sampling the Vista Alegre target. That hole has been completed, and the drill is working on the second hole (HDDVA002). Once Vista Alegre has been drilled, the team will move on to the Sortilegio target and then the Ricardo Herrera target, all of which are within the Belen prospect. The company is also working on more detailed sampling to define the high-grade structures recently found within an expanded zone at the Previsto prospect, which is about 20 km to the north of Belen. BUY

Natural Grocers (NGVC) stock has been trending lower since it blasted higher after the Q2 report on May 8 and just reached its 200-day line at the 40 price level. As I mentioned last week, this has been somewhat frustrating since NGVC has given back the entire Q1 earnings rally and then some. There’s no fundamental reason for the decline, and NGVC can be volatile at times, especially for a grocery store stock. Yesterday, the company announced it will open a new store in Ruidoso, New Mexico, this fall. BUY HALF

Perpetua Resources (PPTA) stock pulled back sharply last week on news of a public offering priced at 13.2, which is part of a comprehensive financing plan that includes the $2 billion debt financing application with the Export-Import Bank of the U.S. That offering, which raised $425 million, closed yesterday. Soon after, National Bank boosted its price target from 24 to 29 to “better reflect the construction stage of the company.” B. Riley also raised its price target, from 16 to 17. PPTA closed at 13.1 yesterday. A link to the webinar can be found in the press release, available here. BUY HALF

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