Cabot Stock of the Week Issue: October 6, 2025

Stocks keep reaching new heights, as last week’s concerns about the market starting to show cracks under the surface seem to have been overblown, at least in the near term. Third-quarter earnings season gets underway next week, and expectations are high again, with economists expecting 8% growth among large caps, according to data compiled by FactSet. Companies may have to exceed those lofty expectations to keep this rally going. For now, though, the market is rolling.

To account for some possible bumpiness in the coming weeks and months, however, today I’m adding a big-name value stock to our portfolio. It’s one that I recommended to my Cabot Value Investor audience last month, and it’s already off to a fast start. It’s a company that thrives when the global economy is sound – which it is, despite myriad fears to the contrary.

Here it is, with my latest thoughts.

NEW RECOMMENDATION

FedEx, Inc. (FDX)

FedEx needs no introduction. It’s the third-largest package courier in the world with a 17% global market share, behind only DHL (39%) and UPS (24%). In America, it’s second banana, behind only UPS, accounting for roughly a third of courier and local delivery revenue and 19% of total parcel volume.

Like every package delivery company, FedEx’s sales and earnings peaked during Covid, when people around the world did virtually all of their shopping online, and packages were zooming around the world like never before. In Fiscal 2021, which for FedEx ended in May 2021, the company’s revenue reached a then-record $83.8 billion, 20% better than any previous year. EPS came in at $19.77 that year, 15.6% higher than the previous (FY 2018) high. In Fiscal 2022, which essentially coincided with year two of the (roughly) two-year-long global pandemic, revenues swelled to $93.5 billion, though the company was less profitable ($14.52).

While there hasn’t been a big dropoff from those two Covid-enhanced years, sales have yet to eclipse that FY ’22 peak, while earnings haven’t come close to the FY ’21 apex. This year (FedEx’s Fiscal 2026 began in June) is on track to come closest to hitting those Covid highs, with analysts forecasting more than $89 billion in revenue and $18.53 in EPS. Next year, those numbers are expected to rise to more than $92 billion and a record $21.23 in EPS. These are projections, of course, but they’re reflective of a healthy and, in fact, incrementally improving global economy.

And yet, as I mentioned, the stock still trades like it’s early April, at the height of post-Liberation Day market fears. To be fair, FDX shares have edged up 13% from their April lows, but that’s less than half the 29% advance in the S&P 500 during that time. Meanwhile, the stock is quite cheap on a price-to-earnings (13x forward estimates), price-to-sales (0.6x) and price-to-book-value (2.0x) basis. The stock is well shy of its five-year averages in all three valuation metrics.

Last November, FDX traded as high as 305 a share; it currently trades at 249. With the always-fruitful holiday shopping season just around the corner, I think FDX can get back to those levels, perhaps in a hurry. As long as the U.S. and global economy don’t collapse between now and the end of the year, I think the stock could reach our target by Christmas. BUY

Current Recommendations

Changes Since Last Week:

Carnival Corp. (CCL) Moves from Buy to Sell

One sell this week, as we book a nearly 30% profit on CCL after just five months. The stock was a value play on the exploding cruise industry, but it appears to have reached a temporary ceiling, with shares pulling back modestly in recent weeks. With a bloated portfolio, it was an easy decision to part ways with a stock that has done its job.

Another Cabot Stock of the Week holding that’s more than doing its job is AST SpaceMobile (ASTS), which rocketed up 44% (!) after successful testing of its new BlueBird 6 satellites. Meanwhile, our two precious metals positions – Agnico Eagle Mines (AEM) and Coeur Mining (CDE) – keep soaring to new heights as investors pour into gold and silver.

Here’s what’s happening with all our stocks.

Updates

Agnico Eagle Mines (AEM), originally recommended by Carl Delfeld in his Cabot Explorer advisory, extended even further into record territory, advancing another 4% as gold prices sprint toward $4,000 an ounce. Ongoing weakness in the U.S. dollar, combined with economic uncertainty pushing investors to gold as a safe-haven investment, continues to drive up the price of gold and gold stocks. So let’s keep riding the wave as far as it takes us. BUY

Airbus (EADSF), originally recommended by Carl Delfeld in his Cabot Explorer advisory, advanced another 2% this week to reach a new all-time high above 238! There was no company-specific news, but the analyst community is increasingly bullish on Airbus’ revenue growth prospects through 2030, thanks to the aircraft maker’s deep order backlog and a long-delayed replacement cycle forthcoming for airlines that will require new jets. We have close to a 40% gain on this stock in just eight months, with more potential upside ahead as the French company attempts to capitalize on rival Boeing’s ongoing struggles. BUY

Alibaba (BABA), originally recommended by Carl Delfeld in his Cabot Explorer advisory, remains red-hot, advancing another 4% this week as the Chinese e-commerce giant’s newfound AI prominence continues to attract investors. The stock is up 38% in the last month alone, meaning our timing was good here. Five analysts have raised their price targets on BABA in the last month, including Jefferies to 230 and JPMorgan to 245. BABA shares currently trade in the high 180s. BUY

American Electric Power Company (AEP), originally recommended by Tom Hutchinson in the Safe Income Tier of his Cabot Dividend Investor advisory, added 4% this week to get back to its August highs above 114. There was no news. We are now back in the black on this utility stock, which pays a decent dividend (3.3% yield) and has been acting more like a growth stock lately, thanks to the immense energy demand to help fuel the AI boom. BUY

ArgenX (ARGX), originally recommended by Mike Cintolo in his Cabot Top Ten Trader advisory, rebounded forcefully after a rare down week, advancing 11.5% since we last wrote. Morgan Stanley raised its price target on the stock from 766 to 1,040 (!), which surely helped. ArgenX is a promising biotech and the maker of Vyvgart, which has blockbuster potential. It’s just moving from clinical trials to market, and the drug has various applications for autoimmune diseases. Vyvgart got U.S. approval in June to treat chronic inflammatory demyelinating polyneuropathy (CIDP), and it’s also now on the shelves in Europe and Japan. Given the drug’s potential, earnings estimates have been accelerating, up from a $21 per share estimate in 2026 to $25 after the second-quarter earnings report. There’s a lot to like with this large-cap biotech, and Wall Street recognizes it. BUY

Armstrong World Industries (AWI), originally recommended by Mike Cintolo in his Cabot Top Ten Trader newsletter, was up 1.5% this week but is just shy of its September highs above 199. There’s been no news, although B of A Securities just raised its price target on the stock from 205 to 220. BUY

AST SpaceMobile (ASTS), originally recommended by Tyler Laundon in his Cabot Early Opportunities advisory, rocketed to new highs this week, up 44% (!) since our last issue. Why the big run-up? Because the company is set to launch another round of satellites after successful testing of its BlueBird 6 satellite by its partner Bell Canada, which tested the BlueBird 6 for 4G voice, video and data connectivity. That further paves the way for AST to accomplish its ambitious goal of delivering internet to smartphones around the world via satellite. AST could start to offer its space-to-smartphone service as early as next year. While the Bell Canada testing only validates the technology’s usage in Canada (including in the country’s many remote areas), it shows that AST’s satellites work. As a result, this mostly theoretical business venture is inching closer to becoming a reality, and the stock zoomed past the previous high of 60 to top 71 as of this writing. We already booked profits on half our stake right around the July high above 60. We will continue to let the remaining half ride and see just how high shares of this potentially revolutionary company can climb. HOLD HALF

Banco Santander (SAN), originally recommended by Carl Delfeld in his Cabot Explorer advisory, finally hit the pause button after a furious run, pulling back less than 1% this week. The only news was that Mike Regnier, chief executive of Santander’s U.K. presence, is stepping down ahead of the Spain-based bank’s merger with TSB. The stock is up 125% year to date but still trades at less than 10x forward earnings estimates and 1.3x book value, so we’re keeping it at Buy despite the huge run-up. BUY

BYD Co. Ltd. (BYDDY), originally recommended by Carl Delfeld in his Cabot Explorer advisory, was flat for a second straight week as the Chinese EV maker awaits its next catalyst. News last month that Warren Buffett’s Berkshire Hathaway had sold its entire stake in the company was a blow to the share price, but that sale occurred in the first quarter of this year, and Berkshire was booking a 20x profit, having invested in BYD nearly two decades ago. Trading well below its May highs and seemingly having bottomed about a month ago, I like the near-term upside. BUY

Carnival Corp. (CCL), originally recommended by yours truly in my Cabot Value Investor advisory, appears to have topped, at least in the short term, and has even pulled back another 3.5% in the week since reporting another solid quarter that included top- and bottom-line beats. I say it’s time to sell and book our nearly 30%, five-month profit. CCL was a value opportunity in a company that keeps putting up record sales (for 10 straight quarters!) but whose share price wasn’t keeping pace with its revenue growth. While shares still haven’t nearly caught up to the company’s fundamentals – the stock trades at less than half its pre-Covid peak above 70 – it has fallen out of favor in the last month, with shares heading south at a time when most stocks are going in the opposite direction. So let’s sell and make room for a stock that has more near-term upside. SELL

Cinemark Holdings (CNK), originally recommended by yours truly in the Buy Low Opportunities portfolio of my Cabot Value Investor advisory, is a post-Covid value play I’m willing to give a bit more rope than CCL, despite its slow start and the fact that it pulled back from 29 to 27 in the last two weeks. For one, that pullback comes on the heels of a convincing rebound after the stock dipped to an early-August low in the 24 range. Also, the movie theater industry is having its best year since Covid, and Cinemark – the third-largest U.S. movie theater chain, and the biggest in Brazil – is on track for record sales this year. And yet, shares are trading about 40% below their pre-Covid highs. In Cabot Value Investor, I set a price target of 42 for CNK. It may take a little while to get there, but like CCL, I think the value opportunity here is undeniable, and this could produce a CCL-like return in the coming months. BUY

Coeur Mining (CDE), originally recommended by Carl Delfeld in his Cabot Explorer advisory, remains unstoppable, advancing another 4% this week. Gold and silver prices (Coeur mines both) keep racing to record highs, and Coeur’s president and CEO, Michell Krebs, will present at the John Tumazos Very Independent Research Virtual Metals Conference this Tuesday. CDE shares have already more than doubled in less than six months since we added it to the portfolio, and I downgraded the stock to Hold two weeks ago. So if you want to book profits on a few shares, I think that would be a wise choice. But I wouldn’t bet against this raging bull market in precious metals at this point. HOLD

DoorDash Inc. (DASH), originally recommended by Mike Cintolo in Cabot Top Ten Trader, stretched another 3% this week to reach new all-time highs near 280! The online food delivery giant finalized its $3.8 billion acquisition of U.K. rival Deliveroo. The deal should further bolster DoorDash’s international presence. We booked profits on half our shares once the stock reached a double a few weeks ago and are letting the rest ride. I wouldn’t start a new position at these levels. HOLD HALF

Doximity (DOCS), originally recommended by Tyler Laundon in his Cabot Early Opportunities advisory, pulled back 2% this week but is still up 6% in the last month. The company recently completed a deal to acquire Pathway Medical, an AI-powered clinical reference platform, allowing providers to instantly access medical data, peer-reviewed research, etc. The addition further bolsters Doximity’s cloud-based network of U.S. clinicians. The company grew revenues by 15% in its latest quarter, and the stock is up more than 20% in the two months since we added it to the portfolio. You could buy on this mini-dip. BUY

D.R. Horton, Inc. (DHI), originally recommended by Mike Cintolo in his Cabot Top Ten Trader newsletter, continued to rebound, up another 2% this week. There was no company-specific news, so it’s possible the Fed’s recent rate cut is what’s driving shares. Citigroup raised its price target on the stock to 175, though that’s barely higher than the current price. We now have a modest gain on the stock. BUY

Fidelity National Financial (FNF), originally recommended by Tom Hutchinson in the Dividend Growth Tier of his Cabot Dividend Investor advisory, was off about 1.5% in its first week in the portfolio. In his latest update, Tom wrote, “The title insurance company stock has levelled off since the recent peak in August. Fidelity should benefit from Fed rate cuts and, hopefully, a reduction in mortgage rates. Business is affected by the housing market as more home purchases result in more business. And the biggest impediment right now is high mortgage rates. FNF is around the highest price since the spring. But it will likely be rangebound until there is some significant improvement in the mortgage rate/housing market situation. Perhaps the situation will improve in the months ahead as the Fed continues to cut rates.” BUY

Helen of Troy Ltd. (HELE), originally recommended by Clif Droke in his Cabot Turnaround Letter, continued to rebound ahead of earnings this Thursday, advancing more than 2% this week after the previous week’s 13% upmove. Expectations are quite low this quarter: Analysts anticipate a 12% decline in revenue, with EPS plummeting year over year from $1.21 last year to $0.52 this year. Perhaps the bar was set too low, and the consumer staples company can clear it. But I’d keep new buys small ahead of the report. BUY

Life360, Inc. (LIF), originally recommended by Mike Cintolo in Cabot Growth Investor, added another 4.5% this week and is off to a very fast start for us. In his latest update, Mike wrote, “Life360 has been quiet on the news front for the past three weeks, but that hasn’t stopped the stock’s steady ascent—shares notched new closing highs today. Clearly the stock has had a nice run, and like many in that camp, some sort of air pocket is always possible (maybe bringing it closer to the 10-week line, which is now in the low 90s). But bigger picture, this stock’s original breakout was in May of this year and the company just came public in the middle of 2024, so it’s anything but overplayed or overowned, and the fundamental story is still in the early innings in terms of user growth, upgrades to paid memberships and advertising to the huge free user base.” BUY

Main Street Capital Corp. (MAIN), originally recommended by Tom Hutchinson in the High Yield Tier of his Cabot Dividend Investor advisor, has pulled back a bit of late, down another 1% this week. In his latest update, Tom wrote, “This BDC, which makes high-interest loans and takes equity stakes in promising small companies, has been a strong performer. It has more resilience than most BDCs because the equity stakes enable it to benefit from the positive market. Earnings were strong after the BDC recorded the largest capital gain in its history upon the sale of equity stakes. MAIN has been trending higher since April, although it has been bouncier over the past couple of months.” BUY

Netflix, Inc. (NFLX), originally recommended by Tyler Laundon in Cabot Early Opportunities, was off 5% this week and has been slowly backtracking for months, down 15% since reaching record highs above 1,300 in late June. Why has one of the world’s great growth stocks been retreating at a time when most of the market is advancing? For one, the stock was coming off quite a run, nearly doubling from 700 a share last October. And this week’s drop was precipitated by comments from (sigh) Tesla CEO Elon Musk, who has been urging his 227 million followers on X/Twitter to boycott the streamer for, in his words, pushing transgender messaging in its kids’ shows. I’m not going to touch the veracity of those allegations with an 11-foot pole, but it’s clear the knee-jerk reaction to unflattering headlines on Wall Street was – as it typically is – sell. In the grand scheme, however, it’s doubtful one admittedly very powerful man’s plea to boycott a company whose services are so embedded in people around the world’s daily lives will put much of a dent in Netflix’s bottom line. Meanwhile, the streamer continues to bolster its one historical blind spot – live sports – by adding next year’s MLB Opening Day game (Yankees vs. Giants) and the Home Run Derby. Plus, in its most recent quarter, Netflix topped analyst estimates yet again and raised full-year revenue guidance. This looks like a clear “buy bad news” opportunity in a great company, so if you don’t already own shares or want to add to an existing position, now is the time. BUY

Oracle Corp. (ORCL), originally recommended by Tom Hutchinson in the Dividend Growth Tier of his Cabot Dividend Investor advisory, bounced back nicely this week, advancing 4% after a rapid pullback from its frenzied post-earnings run-up. In his update last week (prior to the recent bounce-back), Tom wrote, “This newfound AI powerhouse has been pulling back sharply over the past week after the remarkable one-day 36% surge after the earnings report. ORCL is down about 19% from the September 22 high. It’s likely just profit-taking and consolidation because there is good reason for the move higher.

“Future revenue projections have exploded. Revenue for its AI-infused Cloud Infrastructure service grew 77% over last year’s quarter to $18 billion. But the company said it anticipated that revenue would grow to $144 billion by 2030. The 700% revenue growth by the end of the decade was not expected. Oracle also reported a massive backlog of potential customers for its services, which grew to $455 billion from $130 billion two quarters ago. Soaring revenue is a very good reason for a stock price to soar.” The volatility still has me a bit on edge, so I will keep this stock a Hold until it settles into an identifiable pattern. HOLD

Sea Limited (SE), originally recommended by Carl Delfeld in his Cabot Explorer advisory, is right back near its September highs, advancing 5% this week. There’s been no company-specific news. This Singapore-based conglomerate remains one of our top performers and is a great way to gain access to the fast-growing Southeast Asian economy. The stock has more than tripled from our entry point, yet it trades at barely more than half its 2021 apex. Keeping at Buy. BUY

Stoxx Europe Total Market Aerospace & Defense (EUAD), originally recommended by Carl Delfeld in his Cabot Explorer advisory, took a break this week after reaching new highs the previous week. We now have a gain that’s north of 35% on this niche European play. BUY

Tesla (TSLA), originally recommended by Mike Cintolo in Cabot Top Ten Trader, tacked on another 1% this week to add to its recent surge. The company is reportedly set to unveil a new, more affordable model tomorrow, October 7, which would be its first new product launch since the Robotaxi was announced last October. With shares up nearly 30% in the last month, the stock is pretty stretched, so the new car may have to really blow people away to meaningfully extend the run-up. But some analysts are buying in, with both Wedbush and Canaccord Genuity raising their price targets on the stock by a significant margin in the last couple weeks. Let’s keep holding and see what tomorrow’s announcement brings. HOLD

If you have any questions, don’t hesitate to email me at chris@cabotwealth.com.

Here, too, is the latest episode of Cabot Street Check, the weekly podcast I host with my colleague Brad Simmerman. This week we welcomed on Stock of the Week contributor and Cabot Explorer Chief Analyst Carl Delfeld to discuss new globalization efforts - and how to profit from them.

The next Cabot Stock of the Week issue will be published on October 13, 2025.

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