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Today’s new addition is a semiconductor company. It designs products that are the heartbeat of digital technologies. Its content is found in electric vehicles, datacenters, IoT devices, airplanes, mobile devices and more. It is benefitting from surging demand from Apple (AAPL) products, from which it generated 40% of revenue in 2020. While the market cap is a little larger than we typically look for, the opportunity warrants the exception at this time.

We’re letting go of Equifax (EFX) today, booking a nice profit, and reducing our exposure to Home Depot (HD) by half. We also sold Amgen (AMGN) on Monday, after health care industry stocks suffered a major selloff. Drug companies and distributors are anticipating even more pressure to rein in drug prices next year.

Today’s recommendation is a doozy. It may go to the moon, or it may fall flat on its face, but it’s got a good story, and I think we’ve got a decent entry point here.

Today I’m leaning back toward the low-risk end of the spectrum with a recommendation of a stock that is a potential takeover candidate; I think you’ll like the story.

Remain mostly bullish, but hold a little cash to respect the market’s growing divergences. Our market timing indicators are still mixed, though the long-term trend and growth stocks remain in good shape.

The fourth stock in our Forever Stocks to Buy series is SiteOne (SITE), which looks to be the landscape supply industry’s version of Home Depot (HD).

Aflac and Reinsurance Group of America are both Cabot recommendations.

A letter from Cabot President Ed Coburn with his insights and perspectives on all things crypto-related and Cabot’s five rules for investing in cryptocurrencies.

On a recent trip to the local shopping district near my house, I noticed that a staple of the neighborhood--the local movie rental store--had closed. I suspect the closing has a lot to do with the lack of people renting at locally owned video stores. Now I’m seeing a Netflix subscription in my future. It’s not that I’m against the online movie rental giant, but I liked the character of my local video store. Whatever my feelings about the company, it doesn’t change the fact that Netflix (NFLX) has transformed the movie rental business with its online platform. In fact, it was featured in Cabot Market Letter just a few weeks ago.

The market got off to a horrible week as stocks sold off Monday, but things have been a lot better since and the S&P 600 Small Cap Index is now back above where it closed last Wednesday (6% below all-time highs). Stepping back, we see that the broad small-cap index has been bouncing around since March without making any net new progress. But drilling down deeper we see many stocks (including several in our portfolio) acting well.

It’s been another mostly constructive week as many of our stocks inch higher and the economic picture continues to improve.

More color on our recent sale that generated a 40% gain since September and comments on other recommended stocks.

Just a quick update on two of our positions and a bit of an educational component by using the strategy of averaging up, rather than averaging down.

Today I want to share with you the story of my greatest trade. And it was pure luck!

As the coronavirus plagues China, Apple’s iPhone and AirPod production is at risk - and so is Apple stock. Rare earth stocks are the best way to hedge it.

Fueled by better-than-expected earnings last week the S&P 500 rose 1.6%, the Dow climbed 1.1%, and the Nasdaq added 1.3%.



Despite the strong week, on Friday traders’ enthusiasm for the recent rally faded a bit after Fed Chairman Jerome Powell’s commented that the central bank was “on track” to begin reducing its purchases of assets.



However, Monday the bulls stepped right back in and once again “bought the dip.”



This week brings earnings announcements from key mega-cap tech names Amazon (AMZN), Facebook (FB), Alphabet (GOOG), and Apple (AAPL). There is also a bevy of blue chips reporting including United Parcel Service (UPS), Visa (V), McDonald’s (MCD), Coca-Cola (KO), Boeing (BA), Merck (MRK), Caterpillar (CAT) and numerous others. Brace yourself, it’s going to be exciting!
Energy has taken off lately and I want to add exposure to the sector. However, I still want to maintain a somewhat conservative stance, especially as this week’s pick will report earnings next week. As a result, I will be selling in-the-money calls on hydrocarbon explorer Marathon Oil (MRO).

Interest rate worries continued to weigh on the market last week as the S&P 500 lost 1.6%, the Dow fell 1.5%, and the Nasdaq declined by 2.3%. This week will have plenty of market-moving events, including the start of earnings season, so expect continued volatility.