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The stock is strong today thanks to a solid quarterly report last week; earnings came in at $0.15 per share, beating analyst estimates by a penny (the third time in the last four quarter it’s topped expectations) and up 36% over last year. Revenues were $97.3 million, though results there were mixed; the consumer segment saw revenues plunge 24% from a year ago (partly due to the virus), but communications/computing was up 8% (including far faster growth in 5G-related products) and the industrial and auto markets saw sales leap 14%.

Current Market Outlook


Last week featured a lot of dramatic news items (including negative oil prices!), but it ended up being a quiet week in the major indexes, which we take as constructive—the action allowed some stocks to settle down a bit, which is often a sign of accumulation. Thus, we’re optimistic, but the key from here is to take things day by day and to stay in gear with the market’s evidence. Right now, with the intermediate-term trend still up and many stocks acting well, you should be putting some money to work, and then see what comes—further upside (especially if we see many bullish earnings gaps) would be a sign to do some follow-on buying, while a couple of sharp, big-volume selloffs in the market would tell you to hold off. As we wrote above, we’re optimistic the path of least resistance is up, but we’ll stay flexible and take it as it comes.

This week’s list again has plenty of good-looking names to choose from. Our Top Pick is Pinduoduo (PDD), which has turned powerful after a five-month rest. You can start a position here or (preferably) on dips of a couple of points.

Stock Name	Price	Buy Range	Loss Limit
Alnylam Pharmaceuticals (ALNY)	143.58	136-141	120-123
Boston Beer Company (SAM)	459.16	435-450	390-400
DocuSign (DOCU)	107.98	101-105	88-90
Exelixis (EXEL)	27.35	25-26.5	22-23
Freshpet (FRPT)	107.99	74-78	65.5-67.5
MarketAxess (MKTX)	439.96	420-440	375-385
Netflix, Inc. (NFLX)	423.92	410-426	370-380
PayPal (PYPL)	147.00	117-122	107-109
Pinduoduo (PDD)	87.53	48-51.5	42-44
Snap Inc. (SNAP)	16.68	15.5-17	13.5-14

This stock was one of 2019’s biggest turnaround stories, and while it stalled out in the second half of last year, it’s making waves again thanks to a blowout Q1 report.

The market has done about as good a job as could be expected rebounding off its March 23 low, and that makes for an interesting setup next week: If the major indexes can continue to strengthen, we could get a Tides buy signal, and that could also coincide with some bullish blastoff signals, too. To this point, though, the trends have yet to turn up, so we advise a defensive stance -- but we’re certainly keeping our eyes peeled for further unusual strength.

After a strong rebound early in the week, markets sold off a bit over the past two days as investors battle uncertainty on the virus and economic impact fronts. We remain positive on our seven Cabot Global Stocks Explorer stocks and will put some of our 35% cash position to work today with a high quality Singapore bank many of you are familiar with. Our emerging market signal stays negative.

Also, I have a special alert regarding Luckin Coffee (LK), which is down very sharply this morning.

With COVID-19, plunging oil prices, credit/health worries and central bank printing, it’s a time of maximum uncertainty—and such uncertainty plays right into the hands of gold, which has popped back toward multi-year highs. The world’s second-largest gold mining company, is well positioned to benefit from this strength.

Current Market Outlook


Since the March 23 low, the market has pretty much followed the plan, with a good initial rally, a little upside follow through and lots of up/down, news-driven moves since. To be fair, that is more descriptive than predictive—a few big moves in one direction or the other could change the outlook, and today’s action was encouraging for the bulls. Right now, though, the overall evidence remains unchanged: The trend of the major indexes and most stocks is still pointed down, and while many names are doing a good job of hanging in there, few stocks are in true uptrends. Looking ahead, the first sign of light would be a batch of growth-oriented stocks bursting to new highs, followed by the intermediate-term trend of the major indexes turning up (likely to take another week even if all goes well). Given the unprecedented situation, we’re open to anything, but until the buyers show more muscle, we advise sticking with a mostly defensive stance.

The good news is that we continue to see quite a few stocks that institutions have been accumulating in recent weeks. This week’s list has a few, with our Top Pick being Livongo (LVGO), a newer, fast-growing name that’s popped up of late.

Stock Name	Price	Buy Range	Loss Limit
Five9 (FIVN)	78.35	74.5-78	66-68
Livongo Health Inc. (LVGO)	33.34	27.5-30	23-24.5
Newmont Mining (NEM)	57.31	48-51	42.5-44.5
Novavax, Inc. (NVAX)	65.95	13-14.5	10.5-11.5
Peloton (PTON)	53.03	27-29	23-24.5
Pinduoduo (PDD)	87.53	36.5-38.5	33-34
Regeneron Pharmaceuticals (REGN)	512.96	470-490	415-425
RingCentral (RNG)	238.73	213-225	187-192
Sprouts Farmers Market (SFM)	19.00	18.5-19.5	16-16.5
Zscaler (ZS)	126.22	61-64	54-55.5

Precious metal stocks have become mixed of late as economic optimism has increased, but some are still strong, and today’s recommendation is one of them.

In what came as a shock to many, some brick-and-mortar retailers actually did quite well during the shutdown. This retailer emerged as one of the winners in the locked down economy, keeping all its stores open during the pandemic and reporting strong online business (+45%) and higher comparable store sales in April.

The Cabot Profit Booster Portfolio continues to do very well … though depending on which sectors are in favor and which are not on any given day, we have had some stocks moving up and down violently.