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The major indexes are having another good day, and this time so are most leading growth titles. As of 2 p.m. ET, the Dow is up 180 points while the Nasdaq is in the green by 179 points.

Quick Note: Due to the Thanksgiving holiday, you will receive next week’s Small-Cap update a day early, on Wednesday, November 27, 2024.

The S&P 600 SmallCap Index raced higher right after the election, gave a little back last week, found support at the previous all-time high early this week, and is now rallying again.

I think the small-cap story is starting to get out there and driving a wave of interest from investors who haven’t given small caps much thought for a few years. There is so much potential to rally from here that it can be a little hard not to get too bullish.

Amazon.com stock has been one of the top performers of the last decade. But it’s not likely to come close to repeating it in the next decade.

Online scams are already more common than ever and unlikely to slow down anytime soon. Let’s look at the most common types of scams, red flags to avoid, steps to take if you’re worried you’ve been a target or victim, and what you can do to help keep your friends and relatives safe online.

Both Apple (AAPL) and Gilead Sciences (GILD) are making a ton of money and are using their cash flow to buy back stock and pay decent dividends. And all estimates and indications are that the companies will continue to make a boatload of money in 2016 and beyond. Thus, as companies, things look good for Apple and Gilead. The stocks, however, have acted ragged for months.

Remain defensive, but stay tuned as we could get a Cabot Tides buy signal as early as tomorrow if the market cooperates. Tonight, we’ll stand pat with our huge (90%-plus) cash position, but we’ll send out a bulletin if we get a green light.

There isn’t a ton of good news in this new issue, but there are definite signs that emerging market stocks are making an effort at putting in a bottom. Emerging market stocks (as reflected in the MSCI EM ETF) are above their 25-day moving average and have put a little daylight between themselves and their late-October low. We’re also seeing a few stocks attracting flashes of buying interest, which is also a hopeful sign.

It was a quiet week for Explorer stocks as mega tech momentum stocks have led a sharp rebound from the lows of April’s tariff-driven market pullback. This has led the broader markets to close near all-time highs.

But this is nothing compared with Spain’s IBEX 35 index, which is up almost 40% year-to-date, crushing the Nasdaq’s anemic 4% gain. Spain is now Europe’s fastest-growing major economy with electricity prices helping manufacturing and logistics. Spain brought in 94 million visitors last year and I was one of them. In 2024 alone, 170,000 people migrated from Latin America to Spain, further propelling growth and productivity.

One of the stocks recommended in the latest issue of Cabot Green Investor (which just came out last week) is in the business of developing technology that generates electricity from the movement of ocean waves, one of the most plentiful sources of energy on the planet.

Second quarter earnings season is winding down. It was quite a quarter! We’re impressed that so many companies have aggressively reduced their operating costs in the recently completed quarter.

Current Market Outlook


As expected, we’re seeing a ton of day-to-day volatility in the market—last week the Nasdaq spiked higher by nearly 300 points in less than three days, only to give it all back since Thursday. But net-net, we really haven’t seen any change in the market’s picture, as the intermediate-term trend is pointed down for most indexes, sectors and individual stocks. The good news is that, as expected, earnings season has revealed a nice crop of potential leaders that are acting resiliently—this week’s list has a bunch of them to consider. But remember that, in a weak market, good-looking stocks can go bad in a hurry, which is why we advise holding a bunch of cash, and if you buy, you should keep positions very small and look to enter on weakness. We’re keeping our Market Monitor at a level 4 in today’s issue.

This week’s list is chock full of earnings winners, which, encouragingly, are generally holding up well despite the market’s latest slide. Our Top Pick is Etsy (ETSY), whose growth is picking up steam and stock is acting great.

Stock Name	Price	Buy Range	Loss Limit
Alteryx (AYX)	132.78	53-56	47.5-49.5
BioTelemetry Inc. (BEAT)	58.58	59.5-62.5	54-56
CyberArk (CYBR)	111.74	73-75	67.5-69.5
Dexcom (DXCM)	421.36	138-142	127-130
Etsy (ETSY)	112.97	49-51	43-45
Genomic Health (GHDX)	64.42	77-80	67-69
Horizon Therapeutics (HZNP)	49.89	20.5-21.5	19-19.5
The Mosaic Company (MOS)	29.22	34-36	31.5-32.5
Twilio (TWLO)	183.39	81-85	73-75
Ulta Beauty (ULTA)	331.95	298-305	278-280

We saw very strong earnings reports last week from E*Trade (ETFC) and Goldman Sachs (GS). Yesterday, Scottrade Financial Services agreed to be acquired by TD Ameritrade (AMTD). This week;s Update discusses how that scenario might affect E*Trade (ETFC).

Complacency is creeping back into the market, but we remain vigilant as the earnings season cranks up into full gear. That said, the broad backdrop is still in good shape as evidenced by some of our favorite indicators. We’ve also done some pruning recently (mostly among laggards) as the market’s multi-month run is becoming a bit extended. But we still see opportunities, especially in areas investors have overlooked. All told, near-term wobbles are possible, but we remain bullish as the odds favor the new uptrend bringing us higher over time. We’ll keep our Market Monitor at a level 7, but we’ll stay nimble as earnings come in.

This week’s list contains some formerly out-of-favor stocks that are now in much better shape as industry trends improve. Our Top Pick is an engineering firm that shows all the classic signs of being under strong institutional accumulation. We’re OK using dips to enter.

Current Market Outlook


After establishing three bottoms in three months—with each bottom higher than the last—the broad market blasted higher last week, pushing our Market Monitor back into the green zone. But we’re not recommending indexes, we’re recommending stocks, and these stocks are not bouncing off bottoms, they’re breaking out to new highs! Furthermore, a lot of these market leaders are new names that are not familiar to investors—which means there is far more potential buying power than selling power in the stocks.

There are many great growth stories in the bunch, with many possibilities of huge long-term gains in revolutionary businesses, and our Top Pick is one of them; it’s Coupa Software (COUP), a small but fast-growing company whose spending-management software addresses a huge potential market.

Stock Name	Price	Buy Range	Loss Limit
AAXN (AAXN)	87.11	51-55	45-48
Coupa Software (COUP)	262.20	51-54	46.5-48.5
Green Dot (GDOT)	85.11	70-72	63-65
Guess (GES)	0.00	23-24.5	20.5-21.5
Petrobras (PBR)	14.78	15-16	13.8-14.8
Pure Storage (PSTG)	25.64	22-23.5	19.5-20
Teladoc, Inc. (TDOC)	127.95	44-49	39-41
Tenet Healthcare (THC)	0.00	30.5-32	28-29.5
Trade Desk (TTD)	468.02	71-76	65-68
Twilio (TWLO)	183.39	50.5-55	46.5-47.5

In today’s note, we discuss developments and institutional ratings upgrades for some of the stocks in the portfolio, including Fidelity National Information (FIS), Paramount Global (PARA) and Starbucks (SBUX).


The famed “Santa Claus Rally” is underway and, assuming a successful conclusion, portends a bullish early part of the coming New Year.

The market forces do have a profound effect, as illustrated recently by the bourbon and oil markets.

We wrap up a fruitful year with a December Issue of Cabot Early Opportunities highlighting five names spanning everything from bottled water to social media to bitcoin mining.

I like the diversity of this Issue, which has something for everyone.

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November was a tough month for all of the Mag. 7, but two names shone under the pressure while the other five crumbled.