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This week’s update includes commentary on earnings from Adient (ADNT), Berkshire Hathaway (BRK/B), Brookfield Reinsurance (BAMR), Elanco Animal Health (ELAN), TreeHouse Foods (THS), Viatris (VTRS) and ZimVie (ZIMV).

While the broad stock market reaches for new all-time record highs, companies that produce oil and natural gas remain heavily out-of-favor. Yet, with Big Oil stock prices down by as much as 60% since oil prices peaked at over $100/barrel in mid-2014, they look like high-yielding bargains.

In this issue, we outline our bullish outlook for six major oil companies.

This week, we comment on earnings from Adient (ADNT), Brookfield Re (BANR), Brookfield Asset Management (BAM), Goodyear Tire (GT), Mattel (MAT), Newell Brands (NWL) and Western Union (WU).


Next week, Toshiba (TOSYY), TreeHouse Foods (THS), Conduent (CNDT), Ironwood Pharmaceuticals (IRWD) and Organon (OGN) report earnings.

In 1931, Humphrey Neill, who later became famous as the Vermont Ruminator, wrote a book called “Tape Reading and Market Tactics - The Three Steps to Successful Stock Trading.” What are the Mr. Neill’s three steps to successful stock trading? The first step is familiarizing yourself with the methods of the institutions that move the market. The second step is learning how to interpret the actions of both these groups and the investing public. The third step (and hardest of all) is achieving mastery of yourself; of the “temperament, emotions, and the other variables that go to make up human nature.”

For almost the entire time I’ve been editing the Dick Davis Digests, experts have been predicting that natural gas prices would rise. Their reasoning is that, per dollar, you can currently produce much more energy from natural gas than from oil. Since the energy produced by each is indistinguishable, the...

The one big lesson I’ve learned since coming to Cabot is that not only can you time the market, it’s one of the biggest advantages you, the individual investor, has over the big boys. You can move into or out of the market at a moment’s notice! And if you still have money in growth stocks, and you’re watching the market take away a little more every week, you need to consider trying it. Soon.

So far, earnings season hasn’t had that much of an impact on the overall market. I don’t think investors know quite what to make of this quarter. It’s bad. But everyone knows that going in.

This month we’re going with a small software company serving a resilient industry that has been slow to adopt to cloud technology, but which is coming on strong now.

Despite the tough macro environment this company has been beating expectations for many quarters. Management has been raising revenue guidance too, and a tweak to the business model is starting to pay dividends.

Enjoy!

“Too big to fail” distorts the very principles on which capitalism rests by privatizing profits and socializing losses. It’s time to confront the problem.

Welcome to the inaugural issue of Cabot Income Advisor. It is my pleasure to share investment ideas that can provide you with a high income in today’s low interest rate world.
In this issue I highlight three stocks that are great buying opportunities right now for income investors. The stocks are chosen for their high yields, ability to generate attractive call premiums and the likelihood of capital appreciation over time.


While the market indexes have rebounded strongly from the March lows, many individual industries and stocks are still dirt cheap and high yielding, In fact, this is the best market in over a decade in which to find high yields in quality stocks.


Of course, the market is still dangerous and many high yielding stocks are in a precarious financial condition. Many will have to cut the dividend and the price will likely fall. While quality high yields are out there, stocks must be chosen wisely.


These three stocks are a great way to lock in high income and start to build your high income portfolio. Now is the time to embark on your journey to higher income and a more rewarding financial future. I look forward to being your trusted partner.

While I don’t like putting on bullish positions in the hours, or even days, after such a dramatic selloff, there are many ways you can take advantage of this volatility using options.

Two of our stocks reported earnings and opened lower this morning. I’m keeping one on Hold and moving the other, which was rated Buy, to Hold as well.

This stock reported first-quarter earnings that beat expectations last night. However, the stock declined in after-hours trading.

Sprout Social (SPT) reported a terrific Q4 yesterday and offered above-consensus guidance for 2022. Despite the good results and outlook, we’re going to sell another one-quarter position to take our stake down to one half today. The bottom line is it continues to be a challenging environment for pure growth stocks, and we need to continue to adapt to the times.

Cloudflare (NET) reported Q4 results yesterday that surpassed expectations. Revenue was up 54% to $193.6 million while adjusted EPS came in at $0.01. As compared to some other software stocks that have beat expectations, Cloudflare reinvested the surplus cash in growth initiatives, so it didn’t flow to the bottom line.

Market action has gotten hairy, but it’s no reason to panic. In today’s issue I suggest some defensive moves, plus I have a new, nearly-bulletproof recommendation for dividend growth investors.