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The overall market remains mixed, with most of the market doing just OK but growth stocks acting very well, especially this week, which has brought with it a ton of powerful gaps. Divergent environments lend themselves to rotation and potholes, so we don’t think it’s a time to floor the accelerator, but we are adding one more name to the Model Portfolio tonight, leaving us with around 36% in cash.

Elsewhere in tonight’s letter, we write about the importance of being patient soon after you buy a stock, as well as some very encouraging action from our old Two-Second Indicator. We also review some enticing names and give a full view of all our stocks.

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

With earnings season mostly completed, the markets have drifted upwards in the waning days of this otherwise unusual summer. Some splashy IPOs and stock splits have provided some excitement, but the bigger and more enduring news came from the Fed’s official change in its priorities. We discuss our thoughts on this shift in the letter.



We also introduce price targets for several recommended stocks. Over the next few weeks, we will provide targets for the remaining stocks and all newly recommended stocks. Price targets help stay the course when our stocks weaken on noise, and provide a tangible exit point. The assumptions behind the price targets provide a roadmap to gauge the company’s recovery process.



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.

Google, with its mantra “Don’t Be Evil,” has never been totally comfortable in China, which employs an army of censors and spends monumental amounts of money to control Internet content.

The dark clouds of persistent inflation and high interest rates continue to hover over the market. But with a record amount of capital on the sidelines and little to no movement in most stocks over the last two-plus years, I’m optimistic that better days are ahead, assuming the inflation/Fed clouds eventually part. Thus, I continue to seek out companies that are essentially growth stocks at value prices. And today, we add another one to our portfolio in the form of a big-name company that’s benefitting greatly from a return to normalcy in a post-Covid world … but whose shares are trading at barely half their pre-pandemic peak.

Enjoy!

What’s the best way to invest $1,000? Here’s how to determine what the best answer is for you, without taking a big risk.

Dividend-paying stocks are a great addition to almost any portfolio, and companies that regularly raise their dividends (like these 3) are even tougher to beat.

The big banks report Q2 earnings in the next week, so it’s a good time to buy low in some big bank stocks. One in particular stands out.

When you look at the right kind of “forever” ideas, holding for the long term is not difficult.

Continue to take things on a stock-by-stock basis. We’ve seen a buyers’ strike during the past two weeks, with many stocks and indexes falling under their own weight; our Cabot Tides buy signal has vanished, with the market now nine weeks into a rest after the March-August advance.

Alaska Air stock has the perfect combination of growth and value, and looks quite buyable now that it’s near the bottom of an established trading range.

I was talking with an investor recently about the latest stock market downturn. He was puzzled; if General Motors (GM) is supposedly such a great stock and vastly favored among portfolio managers, why would it fall 30% during a market correction?

Dividends are a useful way to add yield to your portfolio and these three dividend-paying stocks look good for 2023.

Black Friday stocks got good early news with October retail sales coming in better than expected. A few sectors in particular stood out.

The first quarter of 2025 has been interesting, to say the least. We wrap it up with the March Issue featuring names across the software, security, coffee chain, specialty metals and sports betting markets.

A few familiar faces, and a few new ones, should mean something for everybody. Details inside.

Last week was another up week for the S&P 500. The index has made up all the tariff Armageddon losses, it’s in positive territory YTD and is within 3% of the all-time high.


The market is flat so far this week. But after the big surge higher, it’s encouraging that the index isn’t pulling back. Perhaps stocks are consolidating a bit ahead of another move higher.

Hello from sunny Florida!

I am on vacation with my family this week, taking a much-needed break from the harsh, snowy Vermont winter (and narrowly making it down here ahead of the latest blizzard to dump another foot or two of snow on the Northeast). But with so much going on in the market – tariffs rejected! GDP growth slowing! AI panic! – I wanted to provide an update on everything that’s going on with our stocks.

The market rally has gotten stuck in the mud for now. It will likely take some good news to really get it moving higher again.

Stocks have hugely recovered from the tariff Armageddon selloffs of early April. The index made up all that tariff ground and the S&P came within just a few percent of the high. But the rally has stalled over the past couple of weeks as positive headlines have been in short supply.

The market is looking good. Sure, it pulled back last week. But not by much. After the huge spike it had, the lack of a more significant pullback is encouraging. Stocks also started this week with a big up day on Tuesday.

The long-awaited market correction has arrived, but whether it will be brief or long, shallow or deep, remains to be seen. The one thing I am sure of is that it won’t be like the previous one! In the meantime, it’s important to treat each stock on its own merits, and today that means selling our weakest, Chegg (CHGG).

As for today’s recommendation, it’s a small company thriving in the homebuilding sector, dominant in its own sub-sector. I think you’ll like it.