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This has been one of the wildest earnings seasons we’ve ever seen. Plenty of leading stocks, including a few in this week’s Top Ten, have reacted strongly to their quarterly reports … but there have been a large number of stinkers, too. All these cross currents tell us one thing: Not everyone is rowing in the same direction, and there’s no need for you to take unnecessary risks until that changes. The good news about such a volatile market is that you can easily spot what stocks are resisting the sellers; should the market resume its uptrend, these are the issues that are likely to put on a spectacular show. For now, you should be holding a little cash on the sideline, while making a couple of purchases here and there during weakness. Our favorite stock of this week’s bunch is MasterCard (MA), which, admittedly, has become well known since coming public eighteen months ago. But last week’s huge earnings-related breakout bodes well, and with the market favoring big-cap, liquid stocks, MA should attract plenty of money.

Stock Name	Price	Buy Range	Loss Limit
APOL (APOL)	0.00	70-78	-
CBI (CBI)	0.00	46-50	-
IBN (IBN)	0.00	61-65	-
KGC (KGC)	0.00	17-19	-
MA (MA)	0.00	170-180	-
MOS (MOS)	0.00	63-68	-
SWN (SWN)	0.00	51-55	-
SYNA (SYNA)	0.00	54-58	-
UTHR (UTHR)	0.00	90-100	-
WG (WG)	0.00	36-40	-

The market was just beginning to turn the corner last week before sellers re-appeared Thursday and especially Friday, driving the major indexes back toward their January lows. Thus, from a top-down perspective, you should respect the bears, which is why our Market Monitor above is again tilted toward the bearish side. On a sector-by-sector basis, however, many stocks are working – mainly oil, gas and gold, though coal stocks are also a bastion of accumulation these days. Right now, these inflation-related plays are just about the only game in town; how long it lasts, nobody knows, but that’s where you should focus your attention, if anywhere. This week’s Top Ten is once again heavy in these strong areas, with our favorite of the week being Goldcorp (GG), which has staged a good-looking breakout on healthy volume. You could buy a little on any weakness, while placing a relatively tight stop under 39, leaving a good risk-reward ratio.

Stock Name	Price	Buy Range	Loss Limit
CLF (CLF)	0.00	105-115	-
COG (COG)	0.00	42-48	-
CTRP (CTRP)	0.00	55-62	-
EOG (EOG)	0.00	108-117	-
FCN (FCN)	0.00	59-62	-
GFA (GFA)	0.00	34-41	-
GG (GG)	0.00	39 1/2 - 42	-
NFLX (NFLX)	0.00	30-32	-
PAAS (PAAS)	0.00	36-40	-
XEC (XEC)	0.00	48-51	-

The sharp market break of 2008 has made it clear that the bears are in control, which means you should remain in a highly defensive position. But money has to flow somewhere, and it appears that, for the moment, pharmaceutical and metal stocks are in favor. This week’s Top Ten sports three pharmaceutical stocks, two other medical names and two precious metal stocks – and most of them have good-looking chart patterns. Just be aware that even strong stocks can get hit in bearish environments, so your emphasis should be on building your watch list, holding cash, and making just token new buys until the storm passes. Our favorite pick this week is Pharmaceutical Product Development (PPDI), a steady company whose bottom line is set to accelerate this year. The stock just broke free from a long consolidation after a bullish outlook, which should offer support on any retreat.

Stock Name	Price	Buy Range	Loss Limit
AUXL (AUXL)	0.00	28-31	-
BMRN (BMRN)	0.00	34-37	-
CPHD (CPHD)	0.00	26-30	-
DV (DV)	0.00	53-59	-
GOLD (GOLD)	0.00	38-41	-
LKQX (LKQX)	0.00	19-21	-
MATK (MATK)	0.00	29 1/2 - 31	-
MLNM (MLNM)	0.00	15-16	-
PAAS (PAAS)	0.00	33-36	-
PPDI (PPDI)	0.00	39-44	-

Today’s new addition has all the attributes we look for in a small-cap software stock.

The company is young, management is insanely smart, the products fit a huge need, growth is 30%+, and the sales team is growing quickly.



In short, it’s an extremely attractive opportunity. Which is why we’re jumping in right after the company came public.



Enjoy!

The market needed a correction and now we have one, or at least the start of one. And the kickoff has been powerful enough to turn our short-term timing indicator negative, which means it’s time to turn a bit defensive, raising cash and leaning toward lower-risk investments. Thus, we sell two more stocks today and downgrade two to hold.As for the new recommendation, it’s a slow and steady telecom company that not only pays a good dividend but also is poised to benefit from the rollout of 5G technology.Full details in the issue.

This month we’re looking past all the current uncertainty in the market at a profitable, young company that should hold its own during this rough patch then accelerate growth into the back half of 2020 (assuming the pandemic eases as we move into the summer months).

The company offers intelligent identity solutions for global enterprises. These solutions are strategic imperatives because they help workers do their job from anywhere and help companies streamline customer experiences.



It’s not the type of stock that’s likely to surge on expectations of an immediate surge in demand, like Zoom Video (ZM) or Teladoc (TDOC). But with 115% net revenue retention the company should grow with current clients in the near-term, then grab its fair share of new business once economic activity picks up again.



We start today with a half position given the market conditions. All the details are inside.

The market’s rebound continues and our stocks, as a whole, continue to perform well. Someday, however, a correction will begin and it will pay to be alert—and to react—when it does.

In the meantime, I will keep recommending the best stocks, a system that has worked quite well in recent weeks. This week, we continue to diversify with a recommendation of a marijuana stock, a group that went through a two-plus year correction and in the process got relatively cheap.



As for the rest of the portfolio, it’s acting well and thus the only change today is a downgrade of one stock from buy to hold.



Full details in the issue.

The market was up big today, and a couple of our stocks hit new highs—which is impressive considering the recent crash—but the market’s major pattern is one of bottom-building, and that takes time.
In the meantime, the action of the best growth stocks gives us a clue as to developing leadership, and the best value stocks are absurdly cheap. Plus, many are paying huge dividends! That’s the case with today’s recommendation, a giant in the oil industry.


As for the rest of the portfolio, it’s acting well (with a couple of very strong stocks in the mix), and thus I have no changes today.


Full details in the issue.

While 2017 was one of the least volatile years ever for the market, 2018 has seen volatility return—with a vengeance! Early February brought the greatest point decline in history for the Dow, while yesterday brought the biggest one-day advance since August 2015 for the Dow, S&P 500 and Nasdaq.

Today, my recommendation is outside the U.S., and outside China, too! In fact, my recommendation is in Brazil, where a young airline is enjoying rapid growth and the chart is positive.

With a bumpy market to work with and a few stocks still to report earnings, we take a look at the political risks to the portfolio. We also shift our focus to Brazil, where we find an unusual commodity company and a fresh airline stock to consider.

Last week I wrote a long piece about Steve Jobs, Apple and AAPL, saying, “AAPL’s best days as an investment are over. In fact, AAPL is likely to underperform the market in the years ahead.” Today, the stock plunged on big volume through technical support, following the news that Steve would take a nearly six-month medical leave. So my timing was lucky. And my conclusion is unchanged. Remember, it’s all about changing levels of perception. Your job--and ours--is to find the next AAPL. One way to do that is to ask, “What company serves a mass market, is profitable, has terrific prospects for growing revenues and earnings rapidly, can ride a wave of societal evolution, and is not yet loved by the majority of investors?”

Isn’t this fun? The market is up big today. But things have been very ugly. And we might not be out of the woods yet.

As of yesterday’s close, the S&P 500 was down 12.49% YTD. The technology stock-heavy Nasdaq was about 19% lower for the year and more than 20% below the November high, officially in bear market territory. The latest down leg is because the Russia/Ukraine situation is getting worse.

Tech stocks steadied a bit this week as quarterly earnings started coming in. Sea (SE) was up this week on two analyst upgrades. Super Micro (SMCI) will report crucial quarterly earnings early next week.

The Explorer’s one current European stock recommendation is Danish drugmaker Novo Nordisk (NVO). It has passed French luxury group LVMH Moët Hennessy Louis Vuitton to become Europe’s most valuable company.

Explorer stocks gained ground this week as market sentiment improved along with the odds of a Fed rate cut this fall.

I’ve been encouraging you to lighten up on some of the Magnificent Seven stocks over the last month or so. In just the last two weeks, these stocks have lost over $1.6 trillion in market value as market enthusiasm has waned and insiders have sold some stock.

What’s behind this trend?

Here are three possible reasons why big tech is facing a tough market.

The S&P 500 and other major indexes finished up yesterday after slightly negative first-quarter economic growth. Not much movement in Explorer stocks this week except Sea Limited (SE), up 11%.

Chinese exports have recently plunged as the psychology of tariffs takes a toll. China relied on exports for about a third of its economic growth last year.

It’s cannabis company earnings season. So, I highlight fourth-quarter results in this issue.

Before we get to the details, here are the key takeaways from earnings reports:

* Price compression continues, creating an ongoing “Hunger Games” environment in which only the financially strong will survive, given the debt levels at a lot of cannabis companies. Much of this debt comes due over the next two years. Bankruptcies might be the clearing event that helps bring an end to price compression. None of our names appear to be at risk, but no guarantees...

This week I’m in Cebu, Philippines. While in a shopping mall I spent a couple of hours analyzing a fascinating situation whereby Samsung, Apple and Huawei stores were right next to each other.

I’m not technically proficient enough to tell you which company and product offer the best value, but Huawei’s lower end smartphone was only $450 and seemed to offer everything anyone would need. Its high-end leader was just slightly cheaper relative to Apple’s most recent model, with all the bells and whistles. The store was very polished and in no way seemed to be of lesser quality to Apple or Samsung.

In today’s note, we discuss pertinent developments for some of the stocks in the portfolio, including Agnico Eagle Mines (AEM), Alcoa (AA), American Airlines (AAL), Berkshire Hathaway (BRKB), Brookfield Wealth Solutions (BNT), GE Aerospace (GE), Pan American Silver (PAAS), Starbucks (SBUX) and Toast Inc. (TOST).