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Investing in revolutionary companies isn’t about finding bargains; it’s about getting on board the rocket ship before the masses.

By using LEAPS options you can add portfolio exposure to this undervalued spin-off company for half the price of buying shares.

One portfolio stock had a earnings beat and there are two additional rating changes.

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.

So much for the market being boring! The Fed – with its “higher for longer” vow – broke up the recent monotony, albeit not in a good way. The S&P 500 has dipped to its lowest level since June, and growth stocks have had a rough go these last two months. But all signs point to a fourth-quarter bounce-back – new bull markets almost never up and fizzle within a matter of months. Knowing this, today we add a beaten-down biotech stock with plenty of upside, a recent recommendation from Cabot Early Opportunities Chief Analyst Tyler Laundon.

Details inside.

Current Market Outlook


After a punishing month, last week’s three-day bounce qualifies as a decent first step for the market and many individual stocks and sectors—most now have some breathing room above last week’s low points, and ideally, we’ll begin to see more potential leaders strut their stuff in the weeks ahead as the situation stabilizes. But a good first step is the best description we can give the bounce at this point given that the intermediate-term trends of just about everything (indexes, sectors, stocks) remain pointed down, and the odds favor plenty of volatility (at the very least) going forward. It’s not 2008 out there, but trends are negative, so until the bulls truly retake control, defense is the name of the game. We’re leaving our Market Monitor at a level 3.

The good news is that this week’s list has many recent earnings winners that could do well once a new uptrend gets underway. Our Top Pick is Exact Sciences (EXAS), a name we’re high on and that remains perched near its highs after another excellent quarterly report.

Stock Name	Price	Buy Range	Loss Limit
Bilibili (BILI)	28.71	13.3-14.5	11-12
Cooper Tire (CTB)	31.50	30.5-32.5	27.5-29
Deckers Outdoor Corp. (DECK)	141.68	126-131	114-117
Exact Sciences (EXAS)	116.91	70-74	63-65.6
HealthEquity, Inc. (HQY)	70.70	90-94	81-83.5
Keurig Dr Pepper (KDP)	25.35	25-26	22.5-23.5
Omnicell (OMCL)	81.03	66-69	61.5-62.5
Starbucks (SBUX)	64.49	62-64	56-57.5
Under Armour, Inc. (UAA)	26.82	22-23.5	20-20.9
VeriSign (VRSN)	190.71	157-162	145-149

Last Friday, while the Dow was dropping 250 points, I took a look at the new highs list. I found 34 stocks, many of them too illiquid and some too stodgy, but one in particular that interests me. It’s Dr. Reddy’s Laboratories (RDY), a major Indian pharmaceutical maker.

In our final Explorer issue of 2023, we add a new artificial intelligence play whose revenues are on track to expand by nearly 50% this year, and whose share price has more than tripled YTD - and yet trades well below its July highs. Back on the upswing, it’s worth buying now.

Enjoy, and happy holidays!

Led by the Magnificent Seven, the S&P 500 is a bit overcooked at the moment. Small and mid-caps, on the other hand, are cheap - and appear poised for outperformance in the New Year. So today, we add a mid-cap life sciences company with high upside potential in an emerging area of biology.

This is a short week as we begin the second half of 2023 with inflation down, recession fears fading, and the animal spirits of investors alive and well.

In the first half of 2023, market performance was positive and narrow, largely driven by the big tech names, and especially artificial intelligence (AI) related stocks. The Dow was up 3.8%, the S&P 500 gained 15.9%, and the tech-heavy Nasdaq was up 31.7%. We will continue to explore the world for the best value and growth stocks providing both conservative and aggressive ideas. EVs across the supply chain, resources, and emerging markets remain the focus but we have the flexibility to change course as opportunities arise.

Current Market Outlook


Last week saw some vicious rotation early in the week, with the super-strong growth names coming down to earth while money gushed into cyclical sectors, but the leaders stabilized as the week wore on and the broad market remains positive, too. From a big-picture perspective, the 90% Blastoff signal last week (90% of NYSE stocks above their 50-day lines) bodes well for the overall market, and the fact that few (if any) leading stocks have cracked is a good sign. All in all, further potholes, rotations and shakeouts are relatively likely given the big run over the past two months and the divergent environment, but until proven otherwise, we continue to think the path of least resistance is pointed up. We’re moving our Market Monitor up another notch to a level 8.

This week’s list has a good mix of setups, with some recent earnings winners, some that have pulled back and others that are in persistent uptrends. Our Top Pick is Arconic (ARNC), which is one of the few cyclical stocks to appear in Top Ten since the uptrend got underway.

Stock Name	Price	Buy Range	Loss Limit
Adaptive Biotechnologies Corporation (ADPT)	39.41	37.5-39.5	34-35
Arconic (ARNC)	17.00	14-15	11.7-12.2
Bill.com Holdings (BILL)	88.76	69-73	60-62.5
Dynatrace (DT)	36.59	35-37	31-32.5
II-VI Incorporated (IIVI)	48.64	45.5-48	40-41.5
LiveRamp Holdings (RAMP)	46.54	48-50	43-44
Pan American Silver (PAAS)	27.28	27-29	24-25
Seattle Genetics (SGEN)	150.85	156-160	140-143
Tractor Supply Company (TSCO)	122.24	115-119	103-105
Zscaler (ZS)	126.22	103-108	89-92

I got questions from my subscribers after ATHN’s move, all of them wanting to know if it was still buyable.

One of the proverbs that I heard repeatedly was, “The most bullish thing a stock can do is go up.”

Despite some wobbles last Friday it has been a constructive week for the market, and especially for growth stocks. Since last Thursday’s close and through yesterday’s close the S&P 500 has inched up 0.5% (back near record closing highs), the Nasdaq has hit a record high and the S&P 600 Small Cap Index is up 0.3%.

So far, so good in September, as there’s no market correction in sight. The increasing likelihood of a Fed rate cut later this month is helping to counteract the negative effects of seasonality during the traditional “spooky season.” Let’s hope the Fed doesn’t disappoint when they convene next week. In the meantime, the investing waters are warm, so let’s take a bigger swing this week by adding one of the world’s greatest and highest-profile growth companies to our portfolio. It’s a recent recommendation from Carl Delfeld to his Cabot Explorer audience. And it’s a former market darling that, after a rough couple years, is starting to gain traction with investors again.

Details inside.

In today’s note, we discuss the recent earnings reports from Nokia (NOK) and Newell Brands (NWL), plus 15 other earnings reports from portfolio companies, some of which impacted their standing in the portfolio. Busy week, so let’s get into it.

It was another rocky week for the market as the tone was set by a rotation out of richly valued tech names, worries over whether the Federal Reserve would stay on hold rather than cut interest rates, and the big story was ongoing concerns about the sustainability of the AI-driven rally. By week’s end the S&P 500 and Dow had lost 2%, while the Nasdaq fell 3.2%.