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The market’s nascent downturn remains in effect, with the short-term trend of most indexes and sectors pointed down and with growth stocks bringing up the rear (though today was a good first step to reverse that). Even so, the pullback from a top-down perspective continues to look normal, so we’re not hiding in our storm cellar, either—we’re hanging onto our resilient, profitable stocks while nibbling here or there on high-odds opportunities. We’ll leave our Market Monitor at a level 6 today.

One of the more encouraging things of the past three weeks is that we’re not having trouble finding good-potential names with solid charts, and this week’s list is no different. Our Top Pick is a great growth story and now, after a couple of bad years, all of the firm’s metrics are pointed in the right direction.

The market’s main trend remains up and thus I continue to recommend that you be heavily invested in stocks that can help you meet your investing goals, all while remaining diversified to reduce risk.

Today’s recommendation is a high-yielding stock that has a great history of performance—and as it’s still working its way back toward its high of February 2020, it’s attractive technically.



As for our current holdings, there are no changes. With the new addition, the portfolio is fully invested.



Details inside.

The market remains in an uptrend and, while the divergences and rotation of recent weeks haven’t been totally erased, our diversified portfolio is doing well and Cabot analysts continue to find attractive investment opportunities.

In our current portfolio, the only change this week is an upgrade of Sea (SE) to Buy.



As for today’s new recommendation, it’s in an out-of-favor sector that has the potential to deliver real upside surprises as the global economy emerges from COVID times.



Details inside.

With the market continuing to improve, and chip stocks increasingly in demand, we add another chip stock (a very established one) to the portfolio today.
But we’re selling one stock too (VECO), taking profits and looking to reinvest them in something with greater potential.


Details inside.

In honor of Cabot Wealth Advisory’s fifth anniversary, Publisher Timothy Lutts is re-running an old favorite on Music.

Today’s note includes earnings updates, ratings changes and the podcast.

This month’s issue includes a new addition to the High Yield Tier, updates on all our holdings, and some advice on handling big winners.

Stocks had a good week, but dark debt-ceiling clouds are gathering. The closer we get to the early-June deadline without a deal, the more likely we are to see some selling, at least if 2011 is any guide. To prepare for such a scenario, today we add a bit of safety in the form of a master limited partnership (MLP)-adjacent play on America’s infrastructure boom. It’s a recommendation from Cabot Income Advisor Chief Analyst Tom Hutchinson, and it’s hitting new 2023 highs as I write this.

Details inside.

It’s anybody’s guess what the second half will have in store for the market. The first half surprised almost everyone with a stellar 16% gain in the S&P.

Investors are sensing a soft-landing, whereby we get past this Fed rate hiking cycle without a recession and minimal economic pain. Recent economic numbers reflect a greater likelihood of that scenario.

Anything is possible. The market could be off to the races, or it could sober up and pull back. Inflation is falling while the Fed is still making hawkish noises. It’s reasonable to assume that even if the economy isn’t slowing down yet, the Fed will continue to raise rates until it does.

Stocks had a sluggish first week of 2024, but it’s not cause for concern yet. In fact, all of the Cabot Stock of the Week holdings are acting well enough that we haven’t had to subtract from the portfolio in weeks, allowing it to swell to 26 stocks with today’s new addition. It’s an undervalued dividend stock that is showing signs of life with interest rate cuts now firmly on the horizon – which should directly benefit its business. Tom Hutchinson just recommended the stock to his Cabot Dividend Investor audience.

Details inside.

The November market rally continues, as signs of renewed health among stocks are popping up in more and more places – including in the Stock of the Week portfolio. So today, we’re only adding – and upgrading. The new addition is a longtime recommendation by Cabot Dividend Investor Chief Analyst, Tom Hutchinson, and one that’s having a surprisingly good year. Lately, it’s gone into overdrive and yet still trades well below its highs. We try and capture the stock’s newfound momentum as we head into the holiday season.

Enjoy – and Happy Thanksgiving!

A banner November for the stock market rolls on, and an encouraging start to the holiday shopping season could act as a catalyst for another strong month in December. The Stock of the Week portfolio is thriving with the pickup in the market, with nine of our stocks hitting either 52-week or all-time highs. So today, we take another big swing by adding a mid-cap software stock recently recommended by Tyler Laundon in his Cabot Early Opportunities advisory.

Details inside.

The bull market remains alive and well, and I continue to recommend that you be heavily invested in a diversified portfolio of stocks.

This week’s recommendation is a very small medical technology company focused on the business of processing and testing cells, as accurately and efficiently as possible. Long-term potential is big.



But to make room for it in the portfolio, something has to go, and this week it’s Digital Realty (DLR), which never really got going for us.



Full details in the issue.

The market remains healthy, with all major indexes in uptrends and no major signs of divergence, and thus I continue to recommend heavy investment in stocks that meet your portfolio’s goals.

However, the recent market rotation has seen growth stocks struggling while high-yielding safe stocks thrive—and our portfolio has been adjusting accordingly, week by week. And this week the trend continues, as we sell two more growth stocks.

This week’s recommendation is a small company with a valuable piece of the world’s mobile communications infrastructure, as its trading symbol makes so clear.

This week marks the beginning of the second-quarter earnings season. I don’t foresee any major changes in the trends in any of our companies, but stock price reactions and trends don’t always line up in the short term.

While things are a bit giddy in the short-term and we’re still in the midst of earnings season (three of our stocks release their numbers tonight or tomorrow), our trend-following indicators bullish and growth stocks are acting great. Thus, you should keep your optimist’s hat on.

After stumbling last Wednesday, the market is back on its feet, with the major indexes all hitting new highs in recent days. Technology stocks have led the way, a reversal of the Dow outperformance we’d seen over the past two weeks.

Even with increased tariff talk and even rockier trading, the markets rebounded strongly Monday. The volatility has increased anxiety, but the consistent bounces are a good sign. In other news, oil prices are bouncing back, interest rates remain subdued, and earnings season begins this week.

Despite a Ukraine conflict that’s roiled markets, Explorer stocks had a good week. And while Sea (SE) reported a mixed and disappointing quarter, Ford (F) made a big announcement as it moves into a new era.

Today I’m bringing you a Q&A with Cabot Benjamin Graham Value Letter Editor J. Royden Ward. You haven’t heard from him in a while, so I wanted to bring you up to speed on his latest thinking about what happened in 2008 and where he sees the stock market and value stocks headed in 2009 and beyond.