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Today we’re taking a half-sized position in an emerging MedTech company disrupting the insulin market. It has developed a fully automated device that removes many of the headaches associated with insulin pumps, which have kept adoption of those systems in check.

It’s a rapid-growth company with one product already approved by the FDA, and more solutions in the pipeline.

All the details are inside the November Issue of Cabot Small-Cap Confidential.

If there was a dominant investment theme for the Cabot Turnaround Letter in 2025, it was the focus on defensiveness, in which we showed a penchant for companies in the consumer staples arena. This, I believe, was—and still is, from a long-term perspective—justified in view of the many headwinds faced by the U.S. economy over the last 12 months.

Now that we’re about to enter a new year, however, the economic winds have started to shift in a more favorable direction. With the Fed’s embrace of a looser monetary policy, sectors that were out of favor or not very strong in 2025 are poised to become better performers in 2026. I’m referring particularly to some of the more economically sensitive industries within the broader consumer discretionary sector.

Tariffs rejected. Big shortfall in GDP growth. Possible emerging conflict with Iran. There were enough headlines last week – and really, Friday alone! – to make your head spin. And yet … stocks were mostly calm, with no sudden movements in either direction. As always, the stock charts matter more than the headlines, at least when it comes to investing.

So, let’s stay the course, which this week means adding a well-known stock that continues to thrive in the midst of the ongoing travel resurgence. It was Mike Cintolo’s Top Pick in his Cabot Top Ten Trader momentum-trading advisory last week.

Details inside.

The market is getting a little frothy.

The S&P 500 is up 5.5% in the five weeks since election day, though that’s a historically normal bump following an election. The bull/bear ratio topped 3.9 last week – just shy of the 4.0 “danger zone” that often precedes pullbacks, though it’s not the first time it’s been this high in recent months. And Bitcoin, an asset that thrives in bull markets and typically tops right before a major pullback, just crossed the $100,000 threshold for the first time and has more than doubled in the last three months.

October hasn’t been accompanied by the type of stock selling we’ve witnessed the last two years, when U.S. markets fell sharply in October and reached a second-half-of-the-year bottom both times. Instead, this October has wrought a more subtle disappointment: rising interest rates.

Indeed, despite the Fed’s 50-basis point cut to the federal funds rate in mid-September ringing in a new era of rate slashing, 10-year Treasury yields have risen steadily since the calendar flipped to October, going from 3.80% to 4.24% – their highest level since July. In fact, Treasury yields are up 15% since September 18, the day the Fed cut rates for the first time in four and a half years.

As you read this, I am likely fortifying my house in preparation for the 400-500 Trick-or-Treaters that are sure to descend on our place in Vermont in a few hours. That’s no exaggeration – we live on a crowded street that draws kids from all over town, and even adjoining towns, trying to maximize their Halloween hauls. The 1,000 pieces of candy I buy every year and the countless ghouls, skeletons, smoke-emitting jack-o’-lanterns and giant spiders I’ve accrued the last few years to adorn our lawn are almost like an annual tax.

Living in such a bustling Halloween hotbed is fun, and it’s certainly a blast for our two kids. But it’s a lot of work, and we’re always happy when the calendar flips to November. And in that way, it reminds me a bit of the market every October.

We spend the vast majority of our time focused on U.S. stocks, and rightly so.

After all, although America has just 4% of the world’s population and generates 23% of the global GDP, 72% of worldwide investment capital is spent on U.S. stocks. That’s a stat our global investing expert, Carl Delfeld, relayed to me and my colleague Brad Simmerman on our latest Street Check podcast (click here to listen to the entire conversation). I knew the global investment axis tilted toward the U.S. – just maybe not that much.

Fourth-quarter earnings season is underway, and while expectations are high at an estimated 11.9% average year-over-year growth among S&P 500 companies, according to data collected by Factset, the actual numbers probably won’t matter much to the market’s short- and intermediate-term direction.

Ignore inflation numbers too. CPI and PPI – this week’s dual reports of the December results – were encouragingly cooler than expected. But in the end, what really matters is how they impact the Fed’s decision-making, which we probably won’t know until at least the end of the month.

Stocks are finally showing signs of life. After a miserable six-week stretch, stocks – with an assist from cooler inflation numbers – appear to be getting in gear. How long the new rally will last may depend on things like Q4 earnings, the early days of Donald Trump’s second term, and what Jerome Powell says next week. But for now, let’s strike while the iron is hot, or at least warm, and add a growth stock whose name you might recognize since so many people use their platform these days. It’s a new recommendation from Cabot Early Opportunities Chief Analyst Tyler Laundon.

Details inside.

What a difference a week makes!

Early last week, things were looking pretty gloomy for the market, with stocks on a six-week losing streak dating back to early December and interest rates, as measured by the 10-year Treasury yield, stretching to 14-month highs. More than 300 stocks on the New York Stock Exchange and Nasdaq were trading at 52-week lows.

There are a lot of things the stock market can handle.

In 2024 alone, stocks advanced more than 20% despite two major overseas wars raging, high interest rates, stubborn inflation, escalating unemployment, a toss-up presidential election in which one of the candidates changed midsummer, tepid consumer confidence, etc. That’s because, aside from Kamala Harris replacing Joe Biden as the Democratic candidate less than four months before the election, most of these potential headwinds were known. What Wall Street fears most is the unknown. And that’s why DeepSeek rattled markets on Monday.

After a two-week correction that prompted us to axe some stocks from the portfolio and reduce our exposure to others, markets have staged an abrupt about-face and staged a four-day rally. It’s not enough to turn our shorter-term indicators positive, but it’s a welcome relief. If the rally continues—which would be unusual given the history of similar corrections—we will change our tactics accordingly.

In tonight’s issue, we give you our latest thoughts on each of our stocks and take a deep dive into the issue of handling big winners—a skill that few practice, but done right, it will make a huge difference in your portfolio.

In today’s issue, we’re adding a reliable new stock to the Safe Income Tier. I also review why you might want to own preferred stock in today’s educational section, and provide updates on all our holdings.

Years ago, on a visit to New York City, I was invited to participate in a wine tasting seminar. My knowledge of wine was rudimentary at best when I attended, and so it remains today.

The market has done a good job of holding its strong early-May upmove, and that’s kept both of our trend-following market timing indicators in positive territory. That said, what we really want to see going forward is upside follow through from the major indexes and leading growth stocks, which would go a long way toward telling us the three-month correction is over.