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tom-hutchinson

Tom Hutchinson

Chief Analyst, Cabot Dividend Investor, Cabot Income Advisor and Cabot Retirement Club

Tom Hutchinson is the Chief Analyst of Cabot Dividend Investor, Cabot Income Advisor and Cabot Retirement Club. He is a Wall Street veteran with extensive experience in multiple areas of investing and finance.

His range of experience includes specialized work in mortgage banking, commodity trading and in a financial advisory capacity for several of the nation’s largest investment banks.

For more than a decade Tom created and actively managed investment portfolios for private investors, corporate clients, pension plans and 401(K)s. He has a long track record of successfully building wealth and providing a high income while maintaining and growing principal.

As a financial writer, Tom’s byline has appeared in the Motley Fool, StreetAuthority, NewsMax, and more. He has written newsletters and articles for several of the nation’s largest online publications, conducted seminars and appeared on several national financial TV programs.

For the past seven years, Tom has authored a highly successful dividend and income portfolio with a stellar track record of success. At Cabot, Tom provides monthly Cabot Dividend Investor issues, regular weekly updates on every portfolio position and a weekly podcast discussing goings-on in the market.

From this author
The rich get richer. Now, you can too.

Growing businesses with big ambitions need large amounts of money to grow and expand to the next level. But these enterprises can’t get the necessary capital from stodgy and risk-averse bankers. And they are still too small to access the capital markets by issuing stock or bonds. Thus, they are forced into the domain of wealthy individuals and institutions that have money and are itching to reap high returns.

These venture capitalists provide desperately needed money to up-and-coming businesses that can’t get it anywhere else. Thus, they are in a position to negotiate very favorable terms for themselves.

As financial markets have grown in sophistication, venture capital investing is no longer the exclusive domain of the wealthy. There is a little-known class of security that enables regular investors to mimic the very same moneymaking strategies employed by the rich and famous. These securities are called Business Development Companies (BDCs).

In this issue, I highlight one of the most successful BDCs on the market. It pays dividends every single month, has a long and consistent track of raising payouts, and has delivered fantastic total returns.
The market rally is forging ahead and making fools of the doubters, despite the Tuesday pullback. The S&P 500 is up 20% since late October and 7.5% so far this year as of Monday’s close.
All is well with the market so far this year. The S&P is up 6.7% in less than two months. It’s a continuation of the 23% rally that started at the end of October and a more than 40% rise from the bear market low in late 2022.

But recent news may jeopardize the current market dynamic. January CPI was higher than expected and indicated that the current problematic inflation isn’t dead yet. Sure, it’s way down from the 9.1% peak in mid-2022 to 3.1%, but it has been rising for several months and is still well above the Fed’s 2% target.
The Goldilocks scenario of falling inflation and a still-strong economy is unlikely to last. Interest rates will have to come down before long or the recession that the market is dismissing might be just a little further down the road. But recent higher-than-expected inflation is making lower rates less likely.

Sure, the rally could last for a while. The economy always seems to be more resilient than people expect. But the circumstances behind the rally since October are unlikely to last. This environment will change. For that reason, it doesn’t make sense to chase stocks that have been working so far this year. It’s better to position ahead of a new dynamic that is likely coming.

Change creates opportunity. There are many great income stocks that are not benefiting from this rally. Yet these stocks are selling at historically very cheap valuations with high yields. These stocks also can thrive in a slowing economy. In this issue, I highlight two stocks in particular that are cheap and high-yielding ahead of a period of likely market outperformance.

The last few years have been punishing for REITs, especially office REITs. But this unique “office” REIT is actually immune to the work-from-home revolution. And it’s trading at a sizable discount.
The market has had a good year so far. The rally that began at the end of October is still in force. But things are getting wobbly.


Last week’s inflation number came in higher than expected. CPI was 3.1% for January and that’s down a lot from the high of 9.1% in June of 2022. But it’s still above the Fed’s target rate of 2%. And inflation has stopped going down even with interest rates at the highest level in decades. That’s a problem.
People will always need electricity, gas and water. And that’s what makes utility stocks so reliable. Here are three that I like right now.
A year from now we could be in a raging bull market or bounding toward a recession. Interest rates could be high or much lower. And we have to see what will happen with these wars and who will be elected president in November. Nobody knows the answers to these questions.

But a year from now there is at least one thing we can bank on: The population is already older than ever before in history and will continue to get still older at warp speed. Between 2011 and 2029, about 76 million boomers born in the U.S. between 1946 and 1964 will turn 65. That’s about 3.6 million per year. There will be tens of millions more older people running around in the years ahead.

The inescapable fact about older people is that they spend much more than any other segment of the population on healthcare. That’s just how we’re built. Boomers control about 70% of this nation’s wealth and the aging population has enormous implications for businesses and markets.

Certain healthcare companies and stocks are positioned ahead of a megatrend and a massive wave of spending. In this issue, I highlight two “BUY”-rated portfolio healthcare stocks. If you don’t own them already, they are well worth considering.
The market seems to be trying to find itself and looking for a reason to rally. Earnings have been pretty good so far. But not enough to drive the overall market higher, at least not yet.
It’s been a good start to the year, with the S&P 500 up more than 3% so far this month. Of course, that’s a big slowdown from the breakneck pace of advancement in November and December. But that’s to be expected.
After the stellar finish to last year, the market rally is continuing, sort of.

The S&P 500 is up for the year. But it’s only up 1.69% and participation is far less broad than it was. Technology stocks are driving the market higher but most of the other sectors are down. The AI euphoria is continuing, but the interest rate rally is gone.
I believe the good news will prevail in 2024. But you never know. Forget about trying to predict the direction of the overall market. However, certain aspects of the current environment and established trends are much more bankable.

For example, it is highly likely that interest rates have peaked. Sure, rates could bounce higher than they are now. But that 5% peak level on the 10-year Treasury is unlikely to be eclipsed, at least in this cycle. Artificial intelligence is here to stay. Businesses must spend on it not only for competitive advantage but as a matter of survival. The new technology will continue to be a strong growth catalyst for technology stocks.

In this issue, I highlight a fantastic dividend stock whose long record of strong performance has been interrupted these last two years because of rising interest rates. It’s also a company that focuses on technology and will surely benefit from the proliferation of AI in the years ahead. The timing for this stock should be outstanding.
Dividend stocks are reliable holdings amid market uncertainty, and Alexandria Real Estate (ARE) offers both a cheap price and positive momentum.
Buying this Dividend Aristocrats ETF is a way to own the 65 best dividend growth stocks on the market. But there are other alternatives too.
It’s earnings season again! And this one should be more important than most.

Earnings are, of course, a big deal for the individual company. But in addition to company-specific fundamentals, Wall Street will be carefully watching what company earnings indicate about the macro environment.
You’ve probably heard of the term 5G technology. But have you heard of these 3 5G technology REITs? They’re the best way to play the 5G boom.
Things look good for 2024. Inflation is down, interest rates have likely peaked, and there is no sign of recession. But you never know. It’s a tough game to predict the future of the market. However, certain trends are likely to persist.

It’s a good bet that interest rates have peaked. Sure, they could edge higher from here. But they are unlikely to soar to new highs past 5% for the 10-year Treasury. The situation would have to completely reverse for that to happen. Meanwhile, stocks that have been dragged lower by rising interest rates have come alive again.

These stocks, which have strong track records of market outperformance, are at historically cheap valuations, have established upward momentum, and are positioned ahead of a likely slowing economy.

Also, artificial intelligence is here to stay. Businesses must spend on it not only for competitive advantage, but as a matter of survival. The new technology will continue to be a strong growth catalyst for technology stocks. And the trend will continue regardless of what the Fed does, or the state of the economy, or who is elected president.

In this issue, I highlight a fantastic dividend stock whose long record of strong performance has been interrupted these last two years. It’s also a company that focuses on technology and will surely benefit from the proliferation of AI in the years ahead. The timing for this stock should be outstanding.
The new year is starting with big momentum. The S&P 500 had a torrid late-year rally where it soared about 16% between late October and the end of the year. Stocks closed out the year with nine straight up weeks, the longest streak since 2004.
Any income investor should know how to reinvest dividends. Whether you should depends on what you’re looking for as an income investor.
If you want to spread out your dividend payments, an ex-dividend date calendar is a handy way to keep track of all your payments.
In an increasingly volatile marketplace, safety has become a must for any portfolio. With that in mind, here are the best safe investments.
Let the good times roll!

A good market just got better. A petering rally has been reinvigorated. And the good times may continue to roll through January.
The market has had seven consecutive higher weeks. And the positive momentum should continue into the new year.

The S&P 500 is up 12.5% in the last seven weeks and 23% for 2023. But those returns are deceiving. Until the market rally broadened out recently, only seven large technology company stocks accounted for nearly all the gains.

Many stocks are still in a bear market. In fact, certain more interest rate-sensitive stocks recently fell to the lowest level since the trough of the pandemic market more than three years ago, although they have rebounded with falling interest rates recently.

Buying stocks in the throes of a bear market has proven to be a winning strategy over time. Buying stocks after they have already started to climb out of the lows has proven to be a winning strategy sooner.

The timing may be perfect for a rare opportunity to generate much higher returns than can normally be expected from stocks of defensive companies. In this issue, I highlight a defensive stock that had been a stellar performer before inflation and rising interest rates took hold. It is priced near the lowest valuations in its history and has recently been generating upward momentum.
AT&T (T) and Verizon (VZ) are perhaps the two most widely recognized telecom stocks. But which is the better stock today?
Despite the index returns this year, many stocks are still in a bear market.

Some interest rate-sensitive stocks recently fell to the lowest level since the trough of the pandemic market more than three years ago. But interest rates have likely peaked. And the main reason for the decline is over.

Buying stocks in the throes of a bear market has proven to be a winning strategy over time. Buying stocks after they have already started to climb out of the lows has proven to be a winning strategy sooner.

The timing may be perfect for a rare opportunity to generate much higher returns than can normally be expected from stocks of defensive companies. In this issue, I highlight a defensive stock that had been a stellar performer before inflation and rising interest rates took hold. It is priced near the lowest valuations in its history and has recently been generating upward momentum.
The Fed and inflation look like they may be behind us, which helps set the stage for a promising 2024. These two income stocks should benefit.
What are qualified dividends? It’s important to know what makes a dividend qualified for tax purposes. Here’s what you need to know.
The superb rally that began after October is fading.

November was the best month for the S&P 500 in over a year. But now some reality is starting to set in. Wall Street took the good news about peak interest rates to another level and started pricing in Fed rate cuts early next year. The market is pulling back after the Fed dismissed that notion.
Instead of focusing on short-term headlines, let’s turn our attention to a mega-trend that’s changing how we live: the aging population.
The strong November rally has sputtered out with the S&P 500 up 8.7% for the month so far. Is that the end of this upside leg?

The month started with a bang after the Fed indicated it was done hiking rates, and jobs and inflation numbers seemed to confirm Wall Street’s opinion that interest rates have peaked. The benchmark ten-year Treasury tumbled all the way from 5% at the end of October to 4.34% at midday on Tuesday.