Latest Summary
CABOT EVENTS
Cabot Weekly Review (Video)
In this week’s video, Mike Cintolo says he’s still cautious given the pattern of the evidence in recent weeks and months--the bottom line is the intermediate-term trend of the major indexes, of the broad market and of leading stocks isn’t up, and now we’re seeing the big-caps joining the correction. The good news is that the wheat is separating from the chaff in terms of relative strength, and Mike’s not having trouble finding resilient names--many of which he presents today.
Stocks Discussed: DAL UAL, DASH, GEV, HOOD, RDDT, MRVL, CRDO, GEO, TSM, PODD, ARGX, NTRA, BOOT, BROS, XOP
Cabot Street Check (Podcast)
This week on Street Check, Chris and Brad discuss the market selloff on the heels of the latest surprisingly strong jobs numbers, rising bond yields and expectations that the Fed may not be quick to cut rates further, and how Nvidia’s (NVDA) Jensen Huang killed quantum computing stocks with one comment at this month’s CES. Then, Cabot Growth Investor’s Mike Cintolo joins to give his thoughts on the market, the nascent correction and positioning for 2025.
Cabot Webinar
2025 Market Outlook: Winning Strategies for a Bullish Year Ahead
Join growth investing expert and Cabot’s Chief Investment Strategist Mike Cintolo for this can’t-miss annual investor event in which he’ll share:
- His view of the current market, and where it’s likely heading based on his proprietary indicators
- A roadmap for capitalizing on the momentum of the past two years while staying prepared for potential shifts
- A breakdown of December’s decline and what it signals for early 2025
- Key risks to watch out for – and how to safeguard your portfolio against them
- The successful strategies he’s used to consistently beat the market for over two decades – and how you can use them to generate outsized profits in 2025
Plus, he’ll reveal the stocks that are emerging as new market leaders – including 2 TOP PICKS that could double in the coming months!
Quarterly Cabot Analyst Meeting
The recording of the Cabot Prime Members Meeting with the Analysts is now available for you to listen to at your convenience—click here for access. This private call with our analysts is one of your exclusive Cabot Prime Pro member benefits.
RECENT BUY AND SELL ACTIVITY
This table lists stocks bought or sold in the most recent Issues or Updates.
Portfolio Updates This Week
Cabot Growth Investor
Bi-weekly Issue January 10: It’s not 2022 or 2008, of course, but the vast majority of stocks out there are in correction mode, and that includes the growth arena, which after a huge run began to hit turbulence in early December and has generally been under pressure since. Now, there are some rays of light out there, which we discuss in this issue, and we’re not having trouble keeping a full-ish watch list for the next upmove, but we’ve been favoring a cautious stance for a while now and think that remains the right move, as we’ve trimmed further this week and now have 60% on the sideline.
In tonight’s issue, we do write about one big positive factor out there (no strength in defensive stocks), talk about the allure of buying former winners “cheap” and, of course, write about all of our names and a bunch we’re watching for when the buyers retake control.
Bi-weekly Update January 2: WHAT TO DO NOW: Happy New Year! December’s weak action has created some decent setups and taken a chunk out of sentiment, both of which are good to see—but the underlying evidence hasn’t changed, with our Cabot Tides negative and few names heading higher. We came into the year with around half the portfolio in cash, and we’re remaining cautious today—our only change is placing Flutter (FLUT) on Hold.
Cabot Top Ten Trader
Weekly Issue Weekly Issue January 6: The new year is off to a good start, with many of the areas that took lumps during December (namely the broad market and growth stocks) showing strength through three days—and, just as important to us, many individual stocks have perked up, with some resilient names pushing to new highs and others that dipped to support bouncing. That’s a good thing, but we’re also keeping in mind the fact that early January is often tricky (lots of sharp moves in both directions), that the intermediate-term trend of most indexes and measures is still neutral-to-negative and that there remain lots of crosscurrents among individual stocks, with some selling off while others strengthen. As we wrote above, we are encouraged and will nudge our Market Monitor up to a level 6, but, while this is a good first step, we want to see the action continue to conclude that the December air pockets are a thing of the past.
For the third straight issue, this week’s list is heavy on growth stocks, which remains a sign that big investors aren’t hunting for safety. Our Top Pick is a name we love fundamentally and whose stock has held up relatively well in recent weeks despite a huge run. If you enter, use a loose stop given its volatility.
Movers & Shakers January 10: The year started out pretty well over the first two days (last week), but this week has been more of a downer, with the major indexes down a bit and with some leading growth stocks again coming under pressure. Going into Friday, most major indexes reversed early-week gains and are down 0.5% to 1% on the week and that doesn’t include what looks like a morning gap down following this morning’s jobs report.
Cabot Options Trader and Cabot Options Trader Pro
Cabot Options Trader Pro Weekly Update
Cabot Options Trader Weekly Update
Cabot Value Investor
Monthly Issue January 8: California is burning and the rest of the country is in a deep freeze. It seems like a metaphor for the mixed messages we’ve been getting from the market in recent weeks, with stocks running very hot and cold since the start of December as the major indexes have mostly held near their highs but the under-the-surface action has been wobbly at best. The last six weeks have been rough on small caps in particular. As both a value investor and a contrarian, that spells opportunity!
So today, we add one of the highest-profile, more beaten-down small-cap stocks out there to our Buy Low Opportunities Portfolio. The stock is miles from its Covid-era highs, but it’s starting to build momentum for the first time in years: shares have tripled since bottoming five months ago. And it’s a name virtually everyone knows.
Details inside.
Weekly Update January 2: It was a rare rough December for stocks.
Sure, the S&P 500 and the Nasdaq were down just over 2%, propped up as usual by enduring strength in the Magnificent Seven. But the losses were far greater in almost every other corner of the market, with 10 of the 11 major sectors declining, small caps tumbling nearly 8%, value stocks off by more than 6%, and energy and materials stocks retreating by double digits.
Cabot Stock of the Week
Weekly Issue Weekly Issue January 6: In the wake of a rare down December, stocks have come roaring back to kickstart 2025, up more than 2% through the first three trading days. It’s early yet, but perhaps the bulls are taking control again after a sluggish end to an otherwise very productive 2024.
Still, there were enough yellow flags under the surface to close out the year that it’s worth taking a cautious approach for now. So today, we add a mega-cap, high-yield dividend stock that’s been a staple of Tom Hutchinson’s Cabot Dividend Investor portfolio for some time.
Cabot Explorer
Bi-weekly Issue January 2: Happy New Year to everyone and wishing you all the best investing in 2025.
Let’s keep in mind this year the merit in legendary global investor Sir John Templeton’s sage advice:
“Diversify. In stocks and bonds, as in much else, there is safety in numbers.”
With this in mind, I see four big trends out there that offer us the opportunity to take a contrarian approach to make some money and lower risk.
Bi-weekly Update January 10: Markets were closed yesterday in honor of the late President Jimmy Carter.
No matter your politics, the service was well done and inspirational.
It was a solid opening this first week of 2025: new recommendation American Superconductor (AMSC) shares were up 10%, Centrus Energy (LEU) shares were up about 8%, and Cloudflare (NET) shares were up 7.5%, and Dutch Bros (BROS) shares were up 7.3%.
Cabot Small-Cap Confidential
Monthly Issue January 8: Editorial Note: With the market closed tomorrow, January 9, we’ve bumped up this week’s Issue to today.
At the end of 2024, we were in a “buy now to win tomorrow” type market. Now, we’re in more of a “buy now to win in the coming quarters” type market.
Given this backdrop, our first portfolio addition of the year is a lower-risk, high-quality software company specializing in digital banking solutions. It’s the fastest grower in its space and is on pace to deliver its first full-year profit in 2025.
Like a lot of stocks in both the software and financial arenas, shares of this company have been a little weak lately. I think that’s good – we can step in at a price modestly lower than just a few weeks ago.
Weekly Update December 19: Note: Due to the Christmas holiday, there will be no Cabot Small-Cap Confidential update next week. Happy holidays!
In last week’s update I spoke about the potential for a market retreat early in 2025 given that investors are sitting on sizeable paper profits, and selling after December 31 would allow them to postpone capital gains taxes.
My projection may have been off by a week and a half.
Cabot Dividend Investor
Monthly Issue January 8: While the outlook for 2025 is positive, things are changing.
Sure, this bull market has driven the S&P 500 nearly 70% higher. But most of the gains are from technology stocks. Until this past summer, nearly all the bull market returns were driven by technology. The rest of the market had done very little.
But the rest of the market is waking up. While artificial intelligence (AI) will likely continue to be a powerful growth catalyst, its dominance over everything else might not be as pronounced in 2025 as it has been in the past. Earnings for other stocks are catching up.
The earning growth difference between the “Magnificent 7” companies and the other 493 S&P 500 companies is expected to plummet from 27.8% last year to 8.3% this year. The rest of the market is cheap, has momentum, and will likely get hot this year as stocks experience an earnings growth spike that could last for years.
In this issue, I highlight a healthcare stock that looks highly promising in 2025. It is poised in front of the aging population megatrend, which makes a successful pick so much easier, and it will likely experience a sizable earning spike in the years ahead. It is an existing portfolio stock of which half the shares were sold last year. It’s a great time to buy back the other half.
Weekly Update January 2: The year 2024 was another great year for stocks. The S&P was up over 23% for the year. It’s a nice addition to the 26% return last year. It is the first back-to-back 20%-plus return years for the index since 1998.
But the year ended on a sour note. Usually, good years in the market finish strong. But not this time. True, the S&P 500 was down less than 2% in December. But that’s only because the big tech companies are still doing okay. The rest of the market had a terrible month.
Cabot Early Opportunities
Monthly Issue December 18: We wrap up a fruitful year with a December Issue of Cabot Early Opportunities highlighting five names spanning everything from bottled water to social media to bitcoin mining.
I like the diversity of this Issue, which has something for everyone.
Cabot Profit Booster
Weekly Issue December 24: First and foremost, this is our last issue of 2024—next Tuesday is one of our two weeks off all year—so we want to wish you and yours a very Merry Christmas, Happy Holidays and a healthy and prosperous New Year.
Also, before we dive into this week’s idea I wanted to address our December expiration cycle trades. Both NCLH and KD stocks finished above their strike prices, which means we walked away from those trades with our full profits.
Cabot Income Advisor
Monthly Issue December 17: By most measures, 2025 looks pretty good for stocks.
The Fed has begun a rate-cutting cycle that should last for the next two years. Historically, stocks do well when the Fed is cutting rates and there is no recession. And the economy has been solid. This bull market is just 25 months old and has returned 65%. Bull markets usually don’t just run out of gas after two years. In fact, the average bull market has lasted 50 months and returned 152%.
But stocks are expensive. The S&P currently sells at 22.3 times forward earnings compared to an average of 16 times over the last twenty years. The market returned 26% in 2023 and about 28% this year with two weeks to go. It might be tough for stocks to deliver another consecutive year of 20%-plus returns.
It may be that a lot of the easy upside is behind us. Stocks can still perform well, but they’ll probably have to earn it in 2025.
In this issue, I highlight a stock that is poised for a strong earnings rebound in 2025. It is a stock that bounces a lot between the highs and lows. And it is currently well below the high. It is also one of the best healthcare companies on the market at a time when the population is older than ever before and aging at warp speed.
Weekly Update January 7: The market sobered up in December after a big post-election rally in November. The S&P fell 2.5% in the last month of the year. But January has started out with stocks up 2.2% already.
Technology is driving the market higher. The sector is taking off after Nvidia (NVDA) issued bullish statements about demand for its artificial intelligence chips. AI is a huge growth catalyst for the market’s largest sector and has proven it can drive the indexes higher all by itself. In fact, technology has been the primary catalyst for the S&P over most of this bull market. But things might be changing.
Cabot Turnaround Letter
Monthly Issue December 18: Many are surprised to learn that the concept of telehealth wasn’t a direct result of the Covid pandemic in 2020. Indeed, the practice of online consultations between patients and medical personnel has been practiced for over 20 years, and this month’s featured company is arguably the first one to bring it to global prominence.
Weekly Update January 10: In today’s note, we discuss pertinent developments and institutional ratings changes for some of the stocks in the portfolio, including Agnico Eagle Mines (AEM), Alcoa (AA), American Airlines (AAL), Atlassian (TEAM) and Toast Inc. (TOST).
Cabot Cannabis Investor
Monthly Issue December 24: Cannabis stocks are set to close out the year with a punishing 14% decline. Cannabis investors need help from anywhere they can get it.
It looks like it could come from an unusual place in 2025. The future of the cannabis industry is now in the hands of President-elect Donald Trump.
If anyone told me a few years ago this would be the case, I might have asked them what they are smoking.
However, the reality is that during his presidential campaign, Trump endorsed all three of the main reforms that would legitimize the industry and boost cannabis share prices: Rescheduling, bank reform known as SAFER banking, and legalization of recreational use. Trump endorsed the first two outright. He implicitly endorsed legal rec-use because he supported the Florida referendum which would have made this change. At the very least, he has openly endorsed decriminalization.
Monthly Update January 8: Here are my top eight predictions for the cannabis sector for 2025.
1. Cannabis rescheduling goes through
Promises made, promises kept. Trump loves a “deep state” challenge. Put these two together, and it seems probable that rescheduling could happen in 2025.
Cabot Money Club
Monthly Magazine January: Inflation is still a problem for many Americans, and it feels unavoidable when it shows up every day at the dining room table. We may not be able to control the price of goods, but this month we’re fighting back against inflation by spending smarter with nine tips that can help keep inflation from busting your budget.
Stock of the Month January 10: Welcome to our 2025 TOP PICKS issue! Our Cabot analysts have kindly shared their top stock ideas for this year. And you’ll find that they include a variety of companies that should be attractive to investors of all styles—growth, value, dividend payers, and companies on the cusp of turning around—as well as small, mid, and large-cap stocks. I hope you’ll find one or more to your liking!
But first, let’s take a look at the economy and the markets and talk about what’s in store for this year.
Ask the Experts
Prime Question for Mike: Hi Mike. I know you have owned TransMedics (TMDX) in the past. It took a beating between May and December of 2024 but is up roughly 25% in the last week. Was curious if you were following this stock and if you think it might be worth buying.
Mike: So, it’s a fair question, but I would say the story isn’t as good at this point, as growth, which was triple digits, is set to slow to 25% or so this year – good, but not the same thing.Plus, while it’s rallied, it’s back into some resistance and of course still buried under its highs. (Update: The stock fell more than 15% in early Friday trading.)
Now … I will say that the move of late, after a big decline and coming on big volume, probably tells me TMDX has bottomed for now. Thus, if shares dipped I wouldn’t be opposed to a nibble if you’re nimble and want to see how it goes.But the overall trend here is down and business is supposed to slow (we’ll see if that turns out to be the case), so we’re looking elsewhere.