Cabot Market Letter is the second-best performing newsletter over the last five years, according to Hulbert Financial Digest. Even though Editor Michael Cintolo recommends his subscribers take a mostly-defensive posture right now, he still recommends buying this stock that’s completely ignoring the market’s correction. After that, we have two sell recommendations from Dow Theory Forecasts.
“Seagate Technology PLC (STX) continues to act very well, with the stock near virgin turf. Many investors are enthralled by the stock’s low valuation (three to four times earnings), but to us, it’s not the valuation but what the company is doing with its incredible $1 billion per-quarter free cash flow that makes STX potentially special — it’s paying a healthy dividend (25 cents per quarter), and is aiming to buy back an average of 10 million shares per month through year-end, which will reduce its share count by 17%. Moreover, those share repurchases should still leave more than $1 billion on the firm’s current authorization, arguing for more buybacks in 2013. Of course, if prices for hard disks collapse, all bets are off, but right now, business should remain buoyant for many quarters. We think you can buy some around here.”
- Michael Cintolo, Cabot Market Letter, May 16, 2012