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In tonight’s Cabot Growth Investor, we review all our stocks and highlight some names we’re watching, including one that’s set up very well ahead of earnings. We also dive into some details about how we run our ship—we’ve gotten a few questions about this lately, and we think this will clear up any questions you may have.

Stocks produced one of their strongest quarters in living memory, with the S&P 500 returning 20.5% in the period ending June 30. The index has nearly fully regained its previously-lost value, declining only 6% for the first half of the year. Investors frequently ask how the S&P 500 can be down only modestly given the Depression-like broad economic statistics.

The odds of a June interest rate increase have now fallen to 47%, from 60% earlier this month. A December rate hike is seen as even less likely, with odds currently at 37%, down from 56%. That’s led to additional gains in bond alternatives like utilities.

This month we’re jumping into a small software company that provides solutions for a specific small- and mid-sized business (SMB) market.

While the market for SMB software has been tough for the last two years, this company’s revenue growth has accelerated and customers that bailed in 2022 are coming back. In short, best-of-breed software isn’t dead! And this player is about to become profitable too. Enjoy!

It’s been a challenging week for growth investors as the stocks that climbed the fastest are getting hit the hardest, such as our Cloudflare (NET) position, despite still posting strong numbers. On the other hand, Oracle (ORCL), where expectations are more modest, jumped from 89 to 104 this week on earnings that beat expectations.

The market has entered a rough patch, especially for tech and stocks that have not been demonstrating relative strength. Explorer stocks are all over the map, with Coupa (COUP) and Cloudflare (NET) showing some weakness, many positions holding steady, and Novonix (NVNXF) up 25% in the last week.

There is one topic that brings together Wall Street, Hollywood and Silicon Valley – the metaverse. While “metaverse” definitions are varied, the idea of bringing people together in a virtual interactive world is, as they used to say, the talk of the town.

Tesla’s goal is big—to be the leading force in the movement to obsolete the internal combustion automobile.