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The broad market remains in an uptrend, according to our intermediate-term market timing indicator, but our longer-term timing indicator, while improving, remains in a negative state. Thus, it remains possible that a major pullback is right around the corner—and if one comes, it will be handy to have cash at the bottom. So I’m still working to avoid being fully invested, though it’s getting tough because our stocks acting so well.
For today’s selection, I’m going with a small company that’s taken a proven path to growth—consolidating a fractured industry. The stock was originally recommended by Tyler Laundon in Cabot Early Opportunities and here are Tyler’s latest thoughts.

Defense contractors have been beaten down for years, but several of them now look like good turnaround stocks. These six appear intriguing.

Today, one investment strategy that’s struggling a bit is the value strategy. While growth stocks in general have had a great year, and international investments have had a great year, thanks in part to the falling dollar, value investing strategies have lagged.

Why would you want to invest in a hard disk maker? Because historically, these companies have provided many opportunities to make big money quickly, and it looks like we’re entering one of those periods today.

I make my living writing advice about aggressive growth stocks in emerging markets, which is a fairly risky business. I don’t just mean that emerging market stocks are risky, although that’s true, too. No, even the writing part is risky. It’s not as risky as writing about penny stocks, bulletin board stocks and pink sheet stocks, but there’s enough risk to make things exciting. It’s entirely understandable that people who read my recommendations can get a little peeved when the stocks I write about go down. But one unexpected result of airing my opinions about growth stocks is that I sometimes get complaints from people even when stocks go up!

This week I’m pleased to bring you something very special: an interview with Dick Davis Digest founder Dick Davis. Prior to founding the Digest, Dick Davis worked at Merrill Lynch, where he began a prolific career as a stock market commentator for radio, television and newspaper. His daily TV market report...

It’s been another sideways week in small-cap land. The S&P 600 index is essentially unchanged from last week, and despite some cross-currents under the surface, is holding firm just above 910.

Small caps have recovered nicely over the last three weeks and the S&P 600 Small Cap Index is bumping up against resistance at 980 for the third time in 2018.

This technique can work wonders if you are bold and are willing to go against traditional investing systems.

Thank you for subscribing to the Cabot Undervalued Stocks Advisor. We hope you enjoy reading the November 2020 issue.

We briefly discuss the soon-to-evaporate election cloud, the merits of holding value stocks when growth/momentum stocks tumble, and highlight one of our portfolio stocks that had some earnings issues along with several others that reported strong earnings that lifted their share prices meaningfully.



Earnings season is in full swing. Six portfolio companies report later this week. We encourage subscribers to visit the reporting companies’ websites to review their earnings-related slide presentations and listen to the post-earnings conference call. These are all available to the public under the “Investor Relations” tab. Sometimes what portfolio companies actually do can seem murky – a quick visit to their website can help clarify, and (at least to me, a certified investment geek) provide some fascinating reading.



Please feel free to send me your questions and comments. This newsletter is written for you and the best way to get more out of the letter is to let me know what you are looking for.



I’m best reachable at Bruce@CabotWealth.com. I’ll do my best to respond as quickly as possible.

First, note that next week’s Presidents Day holiday means we will publish Cabot Stock of the Week a day later, on Tuesday, February 16th.

As for the market. last week’s GameStop affair had the potential to trigger a broad correction—but it didn’t. Thus, the bull market remains intact, the buyers remain in charge and I am happy to recommend a fast-growing company with a great story today.



Sadly, that means I need to sell something to stay at or under 20 stocks, and the victim today (locking in a nice profit) is Qualcomm (QCOM).



Details inside.

Growth stocks are red hot! In this month’s Issue of Cabot Early Opportunities, I sift through all my ideas to feature a compelling mix of five stocks that still look to have significant upside potential over the coming months. Several of these names should represent new ways for investors to participate in long-term growth trends.

I know that these trading fiascos are bad things ... and yet part of me is strangely pleased about them. I like having big object lessons that show what happens when people break the rules and refuse to cut their losses short. Rogue traders aren’t greedy criminals - none of the big ones have made any money for themselves on their dealings. But their mistakes remind us that anyone who reacts to losses by making increasingly riskier trades can parlay bad luck into a financial catastrophe of amazing proportions.

One way we beat the averages is stock selection. We want you to own great stocks in bull markets, like NBTY (NTY).

Why dividend-paying stocks are important to have in your portfolio.