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We’re letting go of Equifax (EFX) today, booking a nice profit, and reducing our exposure to Home Depot (HD) by half. We also sold Amgen (AMGN) on Monday, after health care industry stocks suffered a major selloff. Drug companies and distributors are anticipating even more pressure to rein in drug prices next year.

Since the COVID-19 crash ended just over weeks ago, the market has been impressively strong, with marijuana stocks some of the strongest, as they left behind a two-year bear market.

So even though some of these stocks seem a bit over-extended today, short-term, they still have enormous upside potential in the long-term.



Full details in the issue.

Today’s recommendation is a fast-growing mass market stock that has the leading market share in the online food ordering business. The stock has been trading sideways for five weeks and I think it’s ready for a breakout.

Novonix (NVNXF) shares broke above 5 this week and have more than doubled since early August even as the market is under pressure due to the slowing of federal stimulus, China’s property debt issues, and some increase in interest rates and inflation.

Happy New Year to everyone - I wish you and your families a healthy and prosperous New Year. As we turn the page to 2022, let’s review some trends before getting to a company with a new device to shake up and lower costs in healthcare at home and around the world.

The overriding question coming into last week was whether, after the V-bottom and strong rally for much of August, the market could keep going or would it fall back into a longer bottom-building process. After last week, it’s looking like stocks need more time to set up, as big investors returned from the long weekend and sold stocks basically every day. Of course, today saw a bounce, and a strong-volume rally with fresh breakouts among potential leaders would be very bullish -- but until we see that, we have to assume the market correction that began in mid July is still ongoing. Long story short, we continue to play things relatively cautiously, sticking with small positions and a chunk of cash on the sideline as we wait for more stocks to emerge on the upside. We’ll leave our Market Monitor at a level 6.

This week’s list has a lot of familiar names that are (or are close to) offering decent entry points. Our Top Pick is a consistent grower with a big story that’s trying to emerge from a three-plus-month rest.

In a raging bull market that has benefited virtually every one of the S&P’s 11 sectors, the conspicuous laggard among them has been the consumer staples.


The staples sector is down 2.4% year-to-date, compared to positive net returns on the other 10 sectors. Leadership in recent quarters, which is illustrated in the following chart, includes: info tech (up 13%), communications services (up 12%), consumer discretionary (up 10%) and utilities (up 8%).

The gold-silver ratio is an intimate relationship. It indicates how many ounces of silver are needed to buy one ounce of gold. In the last century, this ratio reached its lowest point at just under 15:1 at the end of 1979 and peaked at over 110:1 during the COVID crisis.

This year, we passed the 100:1 mark for only the fourth time in a hundred years – a strong signal that silver may be underpriced.

So today, we add an aggressive silver play to the Explorer portfolio as a bet that it will close the gap on gold.

Explorer stocks are either steady or performing well with Dutch Bros (BROS) shares up 18.4% during the last two weeks and Luckin Coffee (LKNCY) shares jumping 9.4% this week after a strong first quarter with 41% year-over-year revenue growth.

In addition, Singapore’s Sea Limited (SE) shares are up 18.6% during the last two weeks, and Spain’s Banco Santander (SAN) shares have surged 73% so far in 2025. China’s BYD (BYDDY) shares are up 53% in 2025. New silver and gold play Coeur Mining (CDE) shares were up 13.5% in their first two weeks in the portfolio.

The past week was one of the most fun in a while! But you can’t rest on your laurels in this business; just when you start to congratulate yourself is when the market comes around to slap you down. Today I’m dialing back the risk a bit with a conservative growth stock that you almost certainly know, and which is at a decent buying point.

The major indexes continue to hit new highs, all Cabot’s market timing indicators remain positive, and our portfolio is solid, with no particular worry spots today. Third-quarter earnings have been good to us.

Of course, that will change, and when it does, we will adjust our stance, but for now, we’re making hay while the sun shines—only downgrading one stock to hold today because it’s gotten too expensive.

As for today’s new recommendation, it’s an undervalued stock in a traditional industry, and paying a solid dividend to boot.

Details in the issue.

One year ago, soon after marijuana sales became legal in Canada, investors were throwing money at the sector, anxious to get a piece of the action. Today, the opposite is true—getting money for a cannabis business takes real work!

In choosing today’s stock, I leaned conservative, and found a dividend-paying stock with strong growth prospects. When I selected it yesterday, the stock was at the bottom of its recent range, but today it shot up to near the top of that range. It’s still a good story, but I’d like it better where it was yesterday.

The S&P 500 (SPX) index is up 10% since rising above its previous trading range in late November. While 10% is not necessarily a big move for a stock, it is definitely a big move for a major index.

Today’s CPI reading showed inflation moderating a little (not a huge surprise) and the market has, so far, loved the result. The Nasdaq has been up over 2% in the early going.

After struggling all year, is Tesla (TSLA) stock oversold? Based on the reaction to the latest earnings report, the market sure seems to think so.

WHAT TO DO NOW: As we write about in tonight’s issue, there are many crosscurrents out there, with some growth names cracking while others emerge on the upside, so we’re selling laggards while aiming to add fresher, stronger names. In the Model Portfolio, we sold MP and GEV last week, and today we’re going to sell Oracle (ORCL), which tripped our mental stop today. That said, we’re also going to fill out our position in CrowdStrike (CRWD), adding another half-sized stake, and start a new half position in Vertiv Holding (VRT), all of which will leave us with around 38% in cash.

With rates rising and bonds losing value, dividends are all the rage these days. And these little-known dividend payers are offering some attractive yields.