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In the May Issue of Cabot Early Opportunities we acknowledge the increasingly choppy action in the market and the unprecedented nature of the current recovery.

Similar to last month, we focus on diversifying new buys across different end markets, offering up names with exposure to everything from mobile gaming to oil services to off-road suspension, and more. In short, there’s something for everyone and, we think, enough variety to capture the upside in a wide range of spring and summer market conditions.



Enjoy!

In the April Issue of Cabot Early Opportunities we take a look at the red-hot real estate market and muse on the dramatic and lasting impacts from the Covid-19 pandemic.

We also take hints from the market’s action that it continues to be a time to focus on diversifying new buys across different markets. We take this evidence to heart and add five stocks that offer exposure to everything from resort travel to Afib surgical tools to digital transformation services.



Enjoy!

The overall market continues to be, well, wobbly. After a 2.1% loss last Monday, the sharpest decline in roughly 10 months, the bulls took charge at the opening bell last Tuesday and have yet to give up. Last week, the S&P 500 climbed 1.92%, the Dow advanced 1.07% and the Nasdaq surged 2.76%.

Many of our stocks are following the market’s lead and trading sideways. I have no rating changes in today’s update, but several of our holdings reported earnings over the past week.

This Weekly Update includes earnings updates and expectations on all our portfolio companies. I have no rating changes this week, and most of our holdings are acting quite well.

Pokemon Go has swept the nation these last three weeks, and seemingly everyone (myself included) has joined in on the fun. It reminds me a lot of how the stock market works.

Starting next week, you will receive your Cabot Undervalued Stocks Advisor issues and updates on Tuesdays instead of Wednesdays. So look for next week’s update in your email inbox a day earlier, on Tuesday, December 13.

Thank you for subscribing to the Cabot Undervalued Stocks Advisor. We hope you enjoy reading the December 2022 issue.

While we are not market or economic forecasters, we try to make sense of what is going on. As we’ve commented on in earlier notes, we may be seeing the return of the long-forgotten inventory cycle. If we’re right, this is the time to buy over-discounted and reasonably healthy cyclicals like the ones on our recommended list.

Our letter comments on Big Lots (BIG) earnings, our price target reduction to 25, and why it remains a Hold rather than a Sell.

The Fed is facing a fascinating dilemma. It needs to raise interest rates to address high inflation that seems to be persistent – especially as sharply higher housing prices (about 40% of the Consumer Price Index) work their way into the official inflation numbers. Yet, if the Fed raises rates too high or too fast, it risks a sharp decline in the stock market, a recession and higher financing costs for the federal government.

My value approach seems contrary to the thinking of most investors, but I believe selling when the market is high and buying when the market is low makes sense.

Remain bullish, but don’t get too aggressive. Growth stocks and the market are still in uptrends, so we’re sticking with a heavily invested stance, but many leaders have wobbled of late, the number of stocks hitting new highs has dried up a bit and earnings reports are coming up for a ton of names.

The standout action this week has been in tech stocks, and it hasn’t been good. With the Nasdaq starting off the week with a big drop and large-/mega-cap leaders like Amazon (AMZN), Microsoft (MSFT) and Netflix (NFLX) moving materially lower as the week progressed it has felt somewhat disheartening to those with heavy tech exposure.

How quickly the market can change directions as one week we are on the verge of a steep decline, and the next week the indexes explode higher. This last week fell into the big winner camp as the S&P 500 gained 5.35%, the Dow rallied 5.07% and the Nasdaq added 6.61%.

The good times for the bulls continued as the S&P 500 rose for a fifth consecutive week, its longest such streak since November 2021, and it was also the best week for the S&P 500 since March.

The incredible rally from the March lows has been disrupted. After soaring a remarkable 60% from the March lows, the S&P has pulled back more than 8% from the high. The selloff was long overdue and frankly healthy. It couldn’t continue the torrid pace higher forever.

The recent pullback has put several high quality stocks back in the buy range. In this issue, I highlight one of the very best large companies on the market. The recent turbulence has caused a rare pullback in the price that presents a buying opportunity in a stock that is rarely ever cheap. It also generates substantial call premiums and fantastic income potential.

Thank you for subscribing to the Cabot Turnaround Letter. We hope you enjoy reading the November 2023 issue.

Much of the art of finding interesting turnaround stocks is looking at catalysts, tracking management changes and searching through lists of out-of-favor companies. Sometimes, however, good ideas can be found closer to home – literally – by looking through the roster of public companies in one’s home state. We discuss five turnarounds underway in our home state of Massachusetts.

Despite near-record gold prices, shares of gold producers remain depressed. We discuss two attractive companies. Our Buy recommendation this month is Agnico Eagle Mines Ltd (AEM), a premier gold mining company selling at a discounted price.

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

It can be easy to watch a short-term run-up in IPO stocks and feel like you missed out, but it often pays to give newly issued shares time.

Avalara (AVLR) shares are rising today after the company beat expectations and gave a solid outlook for the rest of the year. Maintaining at buy.

With mortgage rates below their recent highs and an ongoing housing shortage, the future is looking bright for homebuilders, and this luxury builder is my favorite way to play it.

Now is the time to formulate a system that works for you. You’re more than welcome to start with the general philosophy from one of our newsletters and then tailor it to your own personality. Some rules, like cutting losses short when buying growth stocks, are absolute. Others, like how to sell can be adjusted to your own trading and investing goals.