A quick housekeeping note. Cabot will be closed next Thursday and Friday for the Thanksgiving holiday, so I’ll be sending an abbreviated update next Wednesday. Hopefully you have fun plans in the works and are getting to see friends and family that have been kept at arm’s length for far too long. I am debating taking my boys up to VT to get organized for another ski season (my wife likely needs to work), though I may postpone that another week and just hang out around home instead.
On to the market. It was a funkier week than last week, though big picture nothing has changed. We are moving into the tail end of earnings season so we may see a more moderate amount of investor interest over the next two weeks.
There are no ratings changes today.
Recent Changes
None
Updates
Accolade (ACCD) was moved to sell last week due to continued poor performance. SOLD
Earnings: Done
Arena Pharmaceuticals (ARNA) has been quiet since management gave a business update a couple weeks ago. No change. BUY
Earnings: Done
Avalara (AVLR) pulled back in the week it reported and has since been hanging out in the low 150 area. Shares are off 3% this week on no new news. HOLD
Earnings: Done
Cerence (CRNC) is bouncing around as the stock marches toward the Q4 and full-year 2021 earnings release on Monday. Analysts expect revenue will have grown by 8% to $97.9 million while adjusted EPS should come in around $0.57, slightly down from Q4 2020. Assuming that’s about where the chips fall, Cerence will have grown 2021 revenue by 18% to $390 million and adjusted EPS by 49% to $2.45. We’ll be interested to hear what’s going on in the EV, two-wheel and traditional auto markets as well as expansion efforts into other areas (elevators, etc.). It will also be interesting to hear about impacts of chip shortages. Critical will be any indications on expected growth in 2022. The bar is set for 13% revenue growth ($440 million) and adjusted EPS of $2.69 (+10%). HOLD
CS DISCO (LAW) reported last Tuesday, and shares fell following the report but have since recovered some lost ground. As stated several times before, I think LAW will be a big winner long term so sticking with it. BUY
Earnings: Done
Everbridge (EVBG) continues to be in the penalty box as the last quarterly report was fine, but not outstanding. As mentioned in the review, the biggest near-term opportunity is the EU mandate for mass-alert solutions by mid-2022. Everbridge has announced some wins in the region, but we’re hoping for many more, especially since a lot of deals will likely be announced closer to the deadline. The stock has been a hard one to love in 2021 given the ups and downs, but with our remaining quarter position still up almost 700% it’s also one we can afford to be somewhat patient with. I think it’s a stock you can make money on over the next twelve months by buying at these levels. BUY
Earnings: Done
Fiverr (FVRR) popped after reporting a few weeks ago but hasn’t’ done much since. No news and no rating change. HOLD
Earnings: Done
Inspire Medical Systems (INSP) has been consolidating near all-time highs following a strong showing in October. The trends here are solid and I think INSP has more gas in the tank. BUY
Earnings: Done
JOANN (JOAN) has been up and down in the 10 to 12 price range and isn’t likely to make a significant move until after the next earnings report comes out and investors get a better look at sales and supply chain trends. We don’t have an official date yet but should get one soon. This is a value stock and yields nearly 4%%. BUY
Kornit Digital (KRNT) was knocked down a peg yesterday on news of a secondary offering. The company will sell 2.2 million shares, 1.5 million of which will be sold by the company with the remaining to be sold by Amazon (AMZN), which has warrants in Kornit as the result of a deal from several years ago. We don’t have pricing yet, but I expect this offering will be gobbled up. BUY
Earnings: Done
Rani Therapeutics (RANI) snuck an earnings report by me a few days ago so I need to apologize for not sending a Special Bulletin detailing the results. Truth be told, the story hasn’t really changed. But it was another chance to hear management talk about the growth plan. And they did announce they completed a GLP 7-day repeat oral administration study to further evaluate safety and tolerability of RT-102. RT-102 will evaluate a RaniPill formulation of approved osteoporosis treatment Forteo (Eli Lilly), which went off patent around two years ago. Osteoporosis affects 30 million people in the US and EU and requires once-daily injections for months, if not years. This market is worth around $2 billion. The GLP 7-day repeat study is a setup for a Phase 1 study in healthy volunteers to start later in 2022. It was designed to assess the gastrointestinal tract for lesions and changes in clinical pathology and also make sure the drug payload had been successfully delivered. The company finished Q3 with $129.7 million, enough (according to management) to fund operations through 2023. That said, if the share price keeps going up, don’t rule out a small secondary. Typically, that happens right after positive announcements. Management held a fireside chat at the Stifel 2021 Virtual Healthcare Conference yesterday. You can check it out here. RANI has been a rocket ship and is up a healthy amount over the last month. Handling a stock like this is admittedly tough. It is SO early stage that, if the tech works, this is just the beginning. That said, one major misstep – like the capsule doesn’t actually deliver the drug in studies – and a stock like this implodes. For those that understand and accept that the share price paths here are more binary (i.e. win or lose) than gradual (as expected with a stock like SSTK), RANI is a buy. Momentum is terrific, story is great, potential is huge. I do think it’s wise to continue to try and buy on weak days, and don’t rule out a 20% to 40% correction. It’s just that type of stock. BUY
Revolve (RVLV) has made a series of new highs lately. This week the company announced the launch of its Brand Ambassador program, which builds on its influencer marketing strategy. The program offers commissions and incentives to customers that operate as influencers. Ambassadors can create custom landing pages that act as storefronts and which feature curated collections, then share links to those pages across social channels. As a company with significant reliance on social media and influencers to market its products, this program makes sense. HOLD
Earnings: Done
Repligen (RGEN) continues to trade without any clear sense of direction, but thus far its ability to hold above 250 is encouraging. The summer rally in the stock was intense so we’re letting it chill out for a while. HOLD
Earnings: DONE
Shutterstock (SSTK) is doing exactly what we hired it to do, move gradually higher without a lot of volatility or drama. Shares are up 3% since we jumped in two weeks ago. Keeping at buy. BUY
Sprout Social (SPT) isn’t exactly rallying, but since the late-September pullback the trend has continued to be up and to the right. I still like it. BUY
Earnings: Done
Thunderbird Entertainment (THBRF, TBRD.CA) will announced Q1 fiscal 2022 results on Wednesday, November 24 after the market close, with a conference call to follow on Monday, November 29 (delayed due to holiday). We just learned the company will produce a new series based on Underknown’s social media success What If. I have never heard of What If, but apparently it is a very successful science program on social media (30+ million followers, 10+ billion views on YouTube. The new series will be called, If: Imagine the Impossible. It will be a drama-doc series centered on “… seemingly endless questions, epic journeys and unbridled curiosity …” The director and executive producer has worked with Jennifer Lopez (Atlas), Dwayne Johnson (San Andreas and Rampage), among other projects. It sounds interesting and I’m looking forward to checking it out. BUY
Please email me at tyler@cabotwealth.com with any questions or comments about any of our stocks, or anything else on your mind
| Stock Name | Date Bought | Price Bought | Price on 11/18/21 | Profit | Rating |
| Accolade (ACCD) | - | - | - | - | Sold |
| Arena Pharmaceuticals (ARNA) | 2/2/18 | 39 | 59 | 52% | Buy |
| Avalara (AVLR) | 2/1/19 | 40 | 151 | 276% | Hold |
| Cerence (CRNC) | 10/1/20 | 50 | 103 | 107% | Hold |
| CS Disco (LAW) | 9/2/21 | 57 | 47 | -16% | Buy |
| Everbridge (EVBG) | 12/2/16 | 16 | 120 | 677% | Buy |
| Fiverr Intl (FVRR) | 3/5/20 | 32 | 167 | 415% | Hold |
| Inspire Medical (INSP) | 10/4/19 | 59 | 266 | 354% | Buy |
| JOANN (JOAN) | 8/6/21 | 15 | 10 | -33% | Buy |
| Kornit Digital (KRNT) | 3/4/21 | 102 | 155 | 52% | Buy |
| Rani Therapeutics (RANI) | 10/7/21 | 17 | 35 | 106% | Buy |
| Repligen (RGEN) | 11/2/18 and 12/31/18 | 59 | 280 | 373% | Hold |
| Revolve Group, Inc. (RVLV) | 4/1/21 | 46 | 88 | 93% | Hold |
| Shutterstock (SSTK) | 11/4/21 | 121 | 123 | 2% | Buy |
| Sprout Social (SPT) | 9/3/20 | 36 | 133 | 265% | Buy |
| Thunderbird Entertainment (THBRF, TBRD.V) | 5/6/21 | 3.8 | 3.4 | -10% | Buy |