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Old-school value managers like Benjamin Graham and Warren Buffett used to have a funny way of describing their investing style.

They said value stocks were like cigar butts on the sidewalk that had a few puffs left in them.

I’d like to offer an updated version of this metaphor. I think cannabis stocks have a few more puffs left in them between now and the end of the year.

Cannabis names are thoroughly unloved and abandoned once again.

In our final Explorer issue of 2023, we add a new artificial intelligence play whose revenues are on track to expand by nearly 50% this year, and whose share price has more than tripled YTD - and yet trades well below its July highs. Back on the upswing, it’s worth buying now.

Enjoy, and happy holidays!

The S&P 500 and Explorer stocks are in an uptrend in November as investors bet that the Federal Reserve’s interest rate hikes are done for now and that inflation will moderate without a recession. In addition, with most S&P 500 companies having reported third-quarter results, more than 80% have beaten analyst expectations.

With the investing climate improving, today we add two new positions to the portfolio. Enjoy, and Happy Thanksgiving!

Led by the Magnificent Seven, the S&P 500 is a bit overcooked at the moment. Small and mid-caps, on the other hand, are cheap - and appear poised for outperformance in the New Year. So today, we add a mid-cap life sciences company with high upside potential in an emerging area of biology.

I’ve discussed the tumult plaguing the newspaper industry several times recently and after today, I’ll let the topic rest unless something noteworthy happens. But first, I want to share a few more of your letters because they express some ideas that haven’t been voiced here before. Thanks to everyone for writing in, I appreciate you taking the time to share your insights with me and your fellow readers. To read all of the past issues I’ve written about the newspaper industry and see how others responded, go to our Web site archives. If you haven’t shared your view yet, you can do so by sending me an email or commenting on our blog.

The market had its worse day since March yesterday. The worry de jour was the debt limit. I believe the issue will be resolved long before a default occurs one way or another.

No question this is a challenging market but Explorer stocks held their ground. Cloudflare (NET) had a good week up five points, and Ford (F) remains my favorite pick on risk/reward basis. This week we move to a surprising trend that will benefit America, the climate, and your portfolio.

Current Market Outlook


There have been a growing number of yellow flags among leading growth stocks in recent months, and last week the sellers finally came out of the woodwork, causing a quick 10% top-to-bottom drop in the Nasdaq and cracking the uptrends in many leaders. Where does that leave us? Overall, the market’s intermediate-term trend remains up, though it’s getting close to the fence as most indexes test their 50-day lines. Throw in the fact that many areas are holding up OK and we don’t advise you to sell wholesale. But with decisive weakness in most leaders following huge runs (and some climactic upside activity during the past two weeks), paring back makes sense, and from here, the onus is on the bulls to step up. We’re knocking our Market Monitor down to a level 5.

This week’s list contains a bunch of names that have either avoided any major selling or have pulled back normally to support. Our Top Pick is Penn National Gaming (PENN), which looks like one of a couple of leaders in the “new” gaming boom.

Stock Name	Price	Buy Range	Loss Limit
AutoNation (AN)	56.16	54-57	48.5-50
Boston Beer Company (SAM)	791.28	765-790	695-710
Chipotle Mexican Grill (CMG)	1299.15	1230-1270	1100-1125
Deere & Company (DE)	210.19	203-208	183-186
EPAM Systems (EPAM)	308.95	298-308	273-278
Farfetch (FTCH)	26.04	25-26.5	22-23
Five Below (FIVE)	122.69	120-124	106-108
Freeport-McMoRan Inc. (FCX)	15.72	15-16	13.2-13.8
Nintendo Co., Ltd. (NTDOY)	66.76	64-66	59-60
Penn National Gaming (PENN)	55.31	53-56	44-46

With 10,000 micro-cap stocks in the U.S. and Canada, it’s easy for the market to miss investments with a lot of potential. Here are three I like right now.

Even the most well-meaning value investors can fall victim to this common faux pas, but avoiding it is easier than you might think.

ThredUp (TDUP), Sportradar (SRAD) and Alamos Gold (AGI) Report

Worried about what a Bernie Sanders presidency would mean for the stock market? Or Elizabeth Warren? Or Joe Biden? Don’t fret. Here’s what you need to do.

Earnings season can bring big price swings so having a stop-loss for your stocks is important. Here are three ways to play it.

MarketWatch again named Cabot China & Emerging Markets Report the top performing investment letter over the past 12 months, up a remarkable 61.45% vs. negative 2.63% for the dividend-reinvested Dow Jones Wilshire 5000.

Despite last week’s setback, top performing Cabot China Report keeps confidence.

For the first time in a while, it’s actually been a relatively quiet week—the major indexes are hovering around breakeven on the week, though broader indexes are up 1%-ish and the lagging growth areas have gotten off their knees, with many of those funds up 2% to 3% or so. It’s just a start, but that’s good to see.

It’s been another relatively quiet week for the major indexes, with most up in the 0.5% range, though the Nasdaq has outperformed, rising around 1.7% on the week as of this morning.