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It’s been fifteen weeks since the marijuana sector topped, sending the Marijuana Index down 55%. But as the picture of this correction gets clearer, every day I get a little more bullish about the possibility that the sector is ready to turn up again. Most of our stocks are exhibiting typical base-building behavior, though there’s no sign of real buying power yet.

But the fundamentals of the industry remain excellent, so there’s no question that eventually these stocks will get going again.



In the portfolio today there are only two small changes. IIPR moves to Hold, and TPB moves to Sell.



Full details in the issue.

The market weakness has been spreading in recent weeks, and as a result, we have three sell recommendations in today’s issue, as well as three downgrades to Hold.

As for the new recommendation, it’s a major retailer with a stable of familiar names that has transitioned its business very successfully through the pandemic, and it pays a nice dividend!



Details inside.

It’s been eleven weeks since the marijuana sector topped, sending the Marijuana Index down 50%. But as the picture of this correction gets clearer, every day I get a little more bullish about the possibility that the sector is ready to turn up again.

Two weeks ago, acting on this belief, I used half our cash to average up in the industry leaders and add one new small stock to the portfolio and today I’m doing just a little more buying, averaging up in another small operator.



After this buying, the portfolio will be roughly 29% in cash, and going forward, we’ll continue to take our cues from the market, always working to own the market’s leaders as we move closer and closer to full federal legalization.



Full details in the issue.

You can analyze omicron’s spike protein, slice and dice the words of the Fed chairman or do a deep dive into last week’s jobs report all you want. But at the end of the day, all that matters now is that the sellers are in control. To be fair, some short-term measures are stretched, so some type of bounce is possible. Thus, if you’re already defensive, we wouldn’t be in a rush to sell a ton of stuff here, but there’s no question the onus remains on the bulls to begin repairing the damage. We’ll keep our Market Monitor at a level 5.

This week’s list is a hodgepodge of strong names, be it due to company-specific moves, earnings or sector resilience. Our Top Pick is a direct beneficiary of all things construction and infrastructure, and its stock is holding up well.

Last Monday’s dramatic selloff and reversal smelled like a short-term low, but the sellers had other ideas—the bounce from that low lasted just a couple of days before the bears were back at it, with today’s decline further unraveling growth stocks. All in all, we remain in the same cautious stance as we have been for a while: Given the extreme selling in growth and choppiness in many other areas, we think holding a good chunk of cash is paramount; we’re not opposed to a little buying here and there in resilient areas, but we don’t advise playing heavily until the bulls step up to the plate. Our Market Monitor now stands at a level 4.



This week’s list is mostly cyclical and commodity names, all of which are acting or are set up well. Our Top Pick is a Canadian copper and coal play that just lifted from a multi-month rest on big volume.

The market is a bit of a mess, but the selloff has created opportunities to pick up shares in high-growth small- cap names at what seems like extremely attractive prices.





Today’s recommendation is one of those names. It’s a marketplace company that is revolutionizing the outdated industrial manufacturing industry.





While the stock hasn’t been immune to bouts of market volatility it has been far more stable lately than most other high-growth names. It’s up over the last three weeks! And it offers investors exposure to an industry that is seen rebounding in 2022 and 2023.





Enjoy!

As we come to the end of a difficult year for marijuana stocks, it’s worth remembering that the best buying opportunities occur when the picture looks gloomiest; perhaps we’re there now, because the stocks look pretty bad, even though the fundamentals of the industry are terrific!





If so, our portfolio is well positioned to benefit, as we own all the leading companies in the industry, as well as a few more conservative peripheral stocks for diversification.





This week’s issue brings one small change, the addition of well-known ScottsMiracle-Gro, which is currently trading 37% off its high.





Full details in the issue.

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.

However, it’s become increasingly difficult to hold on to growth stocks. Last week I dealt with that by recommending a low-risk income stock with decent growth potential, and this week I’m recommending a very cyclical stock in an industry that was recently deeply out of favor.



As for our current holdings, this week there are two sells and three downgrades to Hold.



Details inside.

The market’s main trend remains up and thus I continue to recommend that you be heavily invested, always working to “upgrade” your portfolio by selling weak stocks and buying healthier ones.

Today’s recommendation is a well-known big technology stock that’s spent the past eight months going sideways, despite the fact that revenue growth has been accelerating. To me, it’s a very attractive setup.



As for our current holdings, there are no changes. After selling two stocks last week, everything looks good today.



Details inside.

The bull market remains intact, so I continue to recommend that you be heavily invested in stocks that help achieve your investing goals.

Today’s featured stock is in the semiconductor industry, which as we all know, is enjoying great demand in a supply-constrained world.



As for the current portfolio, most of our stocks look good, but Progyny (PGNY) is a sell, simply because it is our biggest loser.



Details inside.



Lastly, I hope you’ll join me for the 9th Annual Smarter Investing, Greater Profits Online Conference, August 17-19. We have an incredible line-up of experts ready to share their best picks.

While the market was weak this morning, the bull market remains intact, so I continue to recommend that you be heavily invested in stocks that help achieve your investing goals.

Today’s featured stock is a low-risk dividend payer whose products you have probably bought—and probably never knowing the company’s name. More importantly, Tom Hutchinson says it’s cheap.



As for the current portfolio, most of our stocks look good, so the only changes is an upgrade of Five Below (FIVE) to Buy.

We could see a stock market correction in the near future, due to an abnormal concentration of capital in technology stocks and S&P 500 index ETFs (exchange traded funds).

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.

All the major U.S. stock market indexes are experiencing orderly pullbacks right now. (This is good news because the farther the market climbs without resting, the bigger the pullback when it finally arrives.)

All of our market timing indicators remain bullish, and the major indexes and many stocks are attempting to resume their post-election uptrends. In the Model Portfolio, we have three changes tonight.

We still see more positive than negative evidence, though the gap has shrunk a lot during the past week. At this point, we still think the onus is on the bulls to step up after this three-and-a-half-week retreat. Until they do that in a decisive fashion, you should limit new buying to small positions and, of course, honor your stops for any stocks that are weakening.

We’ve seen before how Trump’s shoot-from-the-hip approach to foreign policy has marked a significant departure from that of his predecessors. But clearly this latest exchange is different. Understandably, the market reacted negatively to the very mention of military conflict with North Korea.