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The market rally that materialized over Thanksgiving week is on temporary hold as investors wait to see if the Fed will, in fact, cut interest rates by another 25 basis points as anticipated this week. If it happens, there’s a good chance the risk-on mood will resume, and the major indexes could reach new all-time highs by Christmas. While I’m not big on predicting what’s going to happen with the Fed, the odds heavily (87%) favor investors getting their wish, so let’s play those odds today by adding a speculative mid-cap software stock recently recommended by Mike Cintolo in Cabot Top Ten Trader.

Details inside.

Cabot offers two very different options trading services to better serve a variety of investors. Here are the differences you need to know.

Despite some selling pressures early last week, the indexes rebounded nicely on nearly every small dip, and by week’s end the S&P 500 had gained 1%, the Dow was mostly unchanged, and the Nasdaq had risen by 1.8%.

Despite some selling pressures early last week, the indexes rebounded nicely on nearly every small dip, and by week’s end the S&P 500 had gained 1%, the Dow was mostly unchanged, and the Nasdaq had risen by 1.8%.

The so-called FAANG stocks have led the bull market rally over the past few years. Now, they’re showing signs of weakness. Where does each go from here?

Bruce Kaser, Chief Analyst of Cabot Undervalued Stocks Advisor and Cabot Turnaround Letter talks about Turnaround Investing. Among the topics he covers:
* Why turnaround stocks can be successful investments
* Criteria we use to pick turnaround stocks
* How catalysts can restore prosperity to struggling companies
* What to avoid when selecting turnaround stocks
PLUS—Bruce shares the details of three turnaround stocks that are attractive to buy now!

Waste Connections, Inc. (WCN, NYSE) is a solid waste disposal company providing collection, transfer, disposal and recycling services to 1.5 million customers in the western and southern U.S. The company owns and operates 134 collection operations, 55 transfer stations, 43 landfills, and 37 recycling operations. Approximately 64% of revenue is...

In today’s update, I outline the reasons why I have every intention of remaining invested in various oil industry stocks in the foreseeable future and give a detailed update on all positions in the portfolio.

We haven’t yet seen the buyers retake control (the intermediate-term trend is down and few stocks are moving up), so we’re sticking with a cautious stance. In the Model Portfolio, we are restoring one Buy rating, but we’re standing pat with 45% cash and are waiting patiently for the trend to turn up.

Earnings reports have been mixed and market activity muted this week, but today the four technology giants will report after the market closes. Germany reported that its economy contracted the most on record, shrinking 10.1% in the second quarter.

Stocks are the highest they’ve been since last summer, and with the debt ceiling in the rear-view mirror and the Fed sounding less hawkish these days, it’s possible they could keep rising as we enter Summer 2023. One sector that’s been unstoppable of late is artificial intelligence, so today we add some more AI exposure, which has already served us well with the performance of Microsoft (MSFT). The new addition is a lesser-known name but is equally red-hot. Mike Cintolo recently recommended it to his Cabot Top Ten Trader audience.

The overall market remains healthy, and while we still haven’t received an “all-clear” signal from our long-term timing indicator, we do have a positive signal from the 90% Blastoff Indicator, and that’s good!

Overall, our portfolio stocks are behaving quite well, with none disappointing today. In fact, many are so strong that I expect pullbacks in the future. The only sale today is of a stock that has given us a quick 30% profit. Otherwise, I’m sitting tight.



As for today’s recommendation, it’s a company in the online education industry, where demand is booming thanks to COVID-19.



Full details in the issue.

Current Market Outlook


After last Monday’s plunge, the initial rebound was very encouraging, and the fact that the major indexes are still doing their best to hang in there is a plus. But, while many individual stocks are in decent shape, the wild rotation that has been a hallmark of 2021 has returned, with money racing into cyclical areas and out of growth stocks the past couple of days. We’re still sticking with a stock-by-stock approach, and most names, despite their wobbles, remain in fine shape, simply pulling in after big runs; others, however, look worse and should be pared back or sold. To be fair, such action isn’t totally surprising—big breaks like last Monday’s usually have some reverberations, so we wouldn’t say the action is negative as much as it’s a sign we’re still in the tricky, choppy environment that has existed for some time. We’re going to leave the Market Monitor at a level 5 and see how things play out in the days ahead.

The good news is that this week’s list is full of names that have enjoyed outsized accumulation of late. Our Top Pick is Devon Energy (DVN), which looks like a leader of a fresh breakout in energy stocks (and cyclical stocks more broadly). We suggest aiming for dips as these names usually pull in after powerful rallies.

Stock Name	Price	Buy Range	Loss Limit
Apache (APA)	23	22-23.5	19.5-20
Biohaven Pharmaceutical Holding (BHVN)	133	130-134	116-119
Brooks Automation, Inc. (BRKS)	109	102-106	93-95
Cimarex Energy (XEC)	88	82-85	72.5-74.5
Devon Energy (DVN)	35	32-34	28.5-29.5
DoorDash (DASH)	217	206-212	185-189
SeaWorld Entertainment Inc. (SEAS)	58	56.5-58.5	51.5-52.5
Signet Jewelers (SIG)	84	82-85	73-75
Snap Inc. (SNAP)	80	78-81	69-71
SVB Financial Group (SIVB)	674	655-675	600-610

Thank you for subscribing to the Cabot Undervalued Stocks Advisor. We hope you enjoy reading the December 2021 issue.

The emergence of the Covid Omicron variant has temporarily upended the market’s emerging post-Covid view of the economy. We share our thoughts on this, as well as on Fed Chair Powell’s testimony this week about accelerating the bond-buying taper. We also comment on how artificial selling pressure as the calendar year-end approaches can drive already-weak stocks to steeply undervalued levels.

Current Market Outlook


After one of the wildest weeks in months, you’ve probably seen countless articles talking about the action and the reasons for it. To us, though, it’s what happens during the next few trading sessions that will count most—right now, the intermediate-term trend of the major indexes is up, though it’s more of a mixed bag for leading stocks (both growth and cyclical). In our view, there’s been enough iffy action to warrant some action; we’re moving our Market Monitor down to a level 6 in today’s issue and have a fair number of sells. But what comes next will count most, with a strong, broad rebound (including some positive earnings reactions) likely boding well, while an inability to bounce/further selling possibly putting a nail in the coffin of the post-November advance. For now, we’re paring back and tightening stops but still giving most of our winners a chance to hold support and resume their advances.

This week’s list has a surprising number of solid charts given the recent turmoil, though we generally still favor buying on dips or some tightening action. Our Top Pick is PagerDuty (PD), which is refusing to budge.

Stock Name	Price	Buy Range	Loss Limit
Affiliated Managers Group, Inc. (AMG)	114	108.5-111.5	98-99.5
Aphria Inc. (APHA)	13	11.5-12.5	10-10.5
Axon Enterprise, Inc. (AXON)	166	157-163	140-143
Marvell Technology Group (MRVL)	53	50.5-53	45.5-47
Matador Resources Company (MTDR)	16	15-16	12.8-13.3
The Michaels Companies (MIK)	15	14.5-15.2	12.8-13.2
Novavax, Inc. (NVAX)	269	225-245	185-200
PagerDuty (PD)	51	47-50	41-42.5
Penn National Gaming (PENN)	104	97-104	85-88
Redfin (RDFN)	75	72-76	64-66

Intuitive Surgical (ISRG) has a great story (next-gen Da Vinci 5 platform) but shares have been irresponsive to the potential and failed to make any sustained progress after the March 18 earnings report.

MP Materials (MP), a rare earths mine and processor, is down about 11% this morning.

Just a quick reminder that, as per last week’s Special Bulletin, the March Issue of Cabot Early Opportunities will be published next Wednesday, March 26. Among the reasons for pushing the Issue back a week is that it will allow time for new portfolio additions to reflect today’s Fed decision to hold rates steady and the updated Summary of Economic projections (SEP), which implies a total of two 25-basis-point cuts this year.

Sell OneStream (OS)

Sell Amer Sports (AS) for Modest Gain