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Stocks moved lower again this week, though we will say the buyers have at least put up a little bit of a fight, with both Wednesday and (so far) this morning showing some buying.

Over the past month or so, it seemed like stocks would continue their frenetic surge. This week, however, the market appears relatively lackluster with a lot less excitement. Some investors may yearn for more fireworks, but as a value investor, I find this calm to be more sane.

This week, we are rolling forward our valuation comments – generally dropping our valuation based on 2021 estimates, where appropriate, while adding commentary based on estimates for 2023. Most analysts project that all of their companies will have higher earnings in future years, so we take the 2023 estimates (which are over two years away) with a grain of salt. And, they almost certainly will be wrong – we just don’t know in which direction or by how much. However, these estimates are helpful in understanding the level and direction of consensus opinion, especially between earnings reports when there is usually little hard news or fundamental data at the company level to support estimate changes.

The major theme that I’m noticing during this earnings season is that Wall Street analysts were low-balling their earnings and revenue estimates as they cautiously assessed the potential impact of the COVID-19 virus on business activity.

Today’s note includes earnings updates on Duluth Holdings (DLTH) and Signet Jewelers (SIG), the podcast and the Catalyst Report.

Today’s note includes earnings updates on 11 companies and the podcast. On Thursday, we moved shares of Oaktree Specialty Lending Corporation (OCSL) from Buy to Sell.

It’s been a solid, steady post-holiday week for the market, with the major indexes generally flat (small and mid-caps) to up (S&P 500 and Nasdaq) 1% or so. That keeps the intermediate-term trend pointed solidly up, with all indexes we track a few percent above their 50-day lines.

You probably couldn’t have scripted a better response by the market and leading stocks to last week’s wild action—the major indexes (a couple of which nosed below their 50-day lines last Friday) have moved straight up this week, with some approaching new-high ground, and many leaders have followed suit. Indeed, in our issue this week, we said the next few days should be key, and we think they have been.

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

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

This is the type of day where you’d typically want to be just watching and waiting, or even doing a little buying. But we have two positions that are at or near prices where we need to take some action.

One stock moves from Buy to Hold, another moves from Strong Buy to Buy, and a third joins the Growth Portfolio as a Strong Buy.

The iShares EM Fund (EEM) gapped up to top its 25- and 50-day moving averages, which returns the Emerging Markets Timer to a positive reading. We are returning our half positions in two stocks and our full position in one stock to Buy ratings and initiating a new position.

Trim your sails. The market’s recent slide has cracked the intermediate-term uptrend, and while the overall bull market is still intact, chances are the market is going to need some time to correct and consolidate going forward.

Remain bullish. There are some cracks in the market’s armor, with some major indexes softening and the broad market under more and more pressure. However, our two trend-following indicators are positive and most leading growth stocks are acting fine. While we’re keeping a close eye on our stocks and will take action if necessary, we’re not making any major moves tonight.

The recently-rumored merger between semiconductor companies Marvell Technology Group (MRVL – yield 1.2%) and Cavium (CAVM) was announced this morning.

The S&P 500 rose 15% year-to-date through October 20, and the Dow Jones Industrial Average rose 18% year-to-date. Those achievements are not remotely unusual when stocks are having a good year. However, it would be normal to expect price corrections along the way—corrections which have been curiously absent this year.

Notice that the S&P 500 has a very specific pattern this year: advance-rest-pullback-recover, then repeat the cycle, continuing to rise as months pass. The market just completed another advance. Therefore, odds are strong that the market’s now ready for some sideways trading.

There’s a lot on my mind lately: hurricanes, child-rearing, college freshmen, human tragedy and Dollar Tree (DLTR).

In the short-term, the market could be ready to rest and there’s some rotation going on, which could affect leadership. But, big picture, the intermediate- and longer-term trends are pointed up and even the broad market is returning to health.