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Cabot Prime Week Ending May 18, 2018

Cabot Prime Week Ending May 18, 2018

Cabot Wealth Summit Registration

What do Cabot’s most successful investors have in common? They come to the Cabot Wealth Summit!

If you haven’t yet registered for the Cabot Wealth Summit, now’s the time because the Extra Early Bird rate expires soon! The Summit is a literal breakfast, lunch and dinner with every one of Cabot’s analysts, a rich and intense program of stock picks, market analysis, investing tips and techniques and a chance for face-to-face Q&A with some of the savviest investors around. We will also have great social activities!

Register here for the August 15-17, 2018 Summit at special pricing for Cabot Prime members.

Cabot Weekly Review

In this week’s stock market video, Paul Goodwin looks at the state of the market, which is positive, but not enthusiastically so. The S&P, the Dow and the Nasdaq are all above their 25- and 50-day moving averages, but they are still in their recent trading ranges and not moving much. The situation in the emerging markets is similar, although China is a little stronger. Paul gives a few stocks that are his favorites in this kind of tepid market, which is stocks that are hitting new highs. When markets don’t have a lot of energy, a stock hitting new highs is a great antidote, although you may want to keep your investments small to begin with.

Cabot Growth Investor

Bi-weekly Update May 16: Mike says to remain optimistic, but continue to take it day by day. The green light from the Cabot Tides remains in effect, which, combined with our solidly bullish Cabot Trend Lines, tell us to lean bullish. From here, he’s still looking for the market and leading growth stocks to follow through to the upside before doing more buying. Tonight, he has no changes in the Model Portfolio.

Bi-weekly Issue May 9: Our Cabot Tides has turned positive, telling us the intermediate-term trend is now pointed up. So tonight, Mike is adding two new stocks to the Model Portfolio. The first is Okta (OKTA), a leading provider of identity solutions to big businesses, boosting both productivity and security. The stock has had a good run but looks like a new leader. The second addition is Shake Shack (SHAK), a burger-focused restaurant that’s in the midst of a rapid store expansion plan.

Other Stocks of Interest April 27: Follow ups to stocks featured November 22, 2017 (issue 1381) to April 125 2018 (issue 1392). Since they’re not in the Model Portfolio, you don’t see them followed on a regular basis. However, we are monitoring these stocks, and this listing gives their current momentum status.

Cabot Top Ten Trader

Movers & Shakers Weekly Update May 18: By our measures, the intermediate-term trend is still pointed up for the indexes and most stocks, and thus, Mike continues to lean bullish. Buy ideas: Autohome (ATHM), Cheniere Energy (LNG), Grubhub (GRUB), Netflix (NFLX) and NovoCure (NVCR). There are two sells this week, Pegasystems (PEGA) and InterXon (INXN).

Weekly Issue May 14: The broad market blasted higher last week, pushing our Market Monitor back into the green zone. Mike’s Top Pick tonight is Coupa Software (COUP), a small but fast-growing company whose spending-management software addresses a huge potential market.

Cabot Undervalued Stocks Advisor

Special Bulletin May 17: Today, Crista is selling Molina Healthcare (MOH) and moving Schlumberger (SLB) from Strong Buy to Buy. She reports that TiVo (TIVO) rose 7.6% yesterday and gives us price action on other portfolio stocks.

Weekly Update May 15: Crista writes that energy stocks are thriving, and some of them have risen into the stratosphere. I never recommend that people chase stocks that just rose 20% to 50% without resting. Let them rest, then jump in to catch the next run-up. On the flip side, financial stocks are just now emerging from a resting period. Many of my favorites appear ready to not only retrace their recent highs, but to surpass them as well! There are no rating changes today.

Special Bulletin May 14: Crista has two rating changes: Morgan Stanley (MS) moves from Strong Buy to Hold and Supernus Pharmaceuticals (SUPN) moves from Strong Buy to Buy.

Monthly Issue May 1: Today, D.R. Horton (DHI) joins the Growth Portfolio as a Strong Buy, and PBF Energy (PBF) moves from the Buy Low Opportunities Portfolio to the Growth & Income Portfolio. Also, Crista discusses stock market trends pertaining to energy stocks, financial stocks and takeover stocks.

Cabot Stock of the Week

Weekly Issue May 15: Tim is selling one stock today: Planet Fitness (PLNT). Our major trend-following indicators are both positive, and that means you can invest freely, confident that the market’s trend will assist, rather than hinder, your efforts. Tonight, Tim is going for a conservative growth stock, Zillow (Z), recently recommended by Mike Cintolo in Cabot Growth Investor, mainly because his previous two recommendations (aggressive growth stocks) have enjoyed such quick success that he fears there may a brief retreat this week.

Cabot Emerging Markets Investor

Bi-weekly Issue May 17: This issue’s featured stock is Noah Holdings (NOAH), incorporated in 2005, it’s an investment firm that offers other alternatives. Noah offers fixed-income, private equity and securities investments to both high-net-worth individuals and enterprises through its 237 branches and sub-branches in 79 Chinese cities. Tonight, Paul is buying half positions in 58.com (WUBA) and IQIYI (IQ), but earlier this week, he sold out of our remaining shares of Weibo (WB).

Special Bulletin May 15: Last Wednesday, Weibo (WB) reported quarterly results that were ostensibly fine—revenue and earnings growth above estimates and guidance in line with estimates—but produced a negative reaction from investors. The stock fell on very high volume and has continued to drop. WB fell below its 200-day moving average on Friday and hasn’t been able to bounce. Accordingly, tonight we’re going to sell our remaining half position in the stock and hold the cash.

Bi-weekly Update May 10: With stocks having chopped lower for three-plus months, there’s a firm foundation for the market to build on, and Paul is very encouraged with the action of our stocks. Overall, then, he’s taking a slightly more constructive view of the market. Tonight, he’s moving 51job (JOBS) back to Buy a Half, moving Alibaba (BABA) and GDS Holdings (GDS) back to buy, buying another half position of Petrobras (PBR) and adding an initial half position in 58.com (WUBA).

Cabot Benjamin Graham Value Investor

Weekly Update May 17: Crista is selling Gentex (GNTX) and says to consider owning Discovery Communications (DISCA), because their debt numbers and price chart are improving, and their EPS and P/E numbers continue to look very appealing

Cabot Dividend Investor

Weekly Update May 16: Chloe has no rating changes today. She says that if you feel underinvested and are looking to take advantage of this pullback to do some buying, ONEOK (OKE), Broadridge (BR), Intel (INTC) and McGrath RentCorp (MGRC) are all in strong uptrends.

Monthly Issue April 25: Chloe is selling one third of our 3M (MMM) shares. This month’s featured buy is McGrath RentCorp (MGRC), which joins the Safe Income Tier.

Cabot’s 10 Best Marijuana Stocks

Update April 18: Tim remains long-term bullish on the marijuana sector, aiming to build a diversified portfolio of the best U.S. and Canadian stocks, and he’s looking forward to delivering your next quarterly issue of Cabot’s 10 Best Marijuana Stocks in the middle of May.

Spring Issue February 15: Tim gives updates on the 10 stocks we’ve been following and two new stocks. The market’s recent correction has brought most of them down to what look like good buying areas.

Wall Street’s Best Investments

Daily Alert May 18: Intuit (INTU) from Contrarian Outlook
Daily Alert May 17: 51Job (JOBS) from Cabot Emerging Markets Investor

Monthly Issue May 16: Our May Spotlight Stock is, Zayo Group Holdings (ZAYO), a cutting-edge technology stock. Nancy’s Feature article its focus on a specific niche within the much-anticipated 5G network arena.

Daily Alert May 16: Sell: Pandora Media (P) from The National Investor
Daily Alert May 16: Fidelity Emerging Asia (FSEAX) from Fidelity Monitor & Insight
Daily Alert May 15: Hovnanian Enterprises, Inc. (HOV) from The Turnaround Letter
Daily Alert May 14: SPDR S&P Oil & Gas Exploration & Production ETF (XOP) from Positive Patterns

Wall Streets Best Dividend Stocks

Daily Alert May 18: Innergex Renewable Energy (INE.TO) from Dividend Advisor
Daily Alert May 17: AVX (AVX) from The Prudent Speculator
Daily Alert May 16: Lowe’s Companies Inc. (LOW) from Sure Dividend
Daily Alert May 15: Alerian MLP ETF (AMLP) from The National Investor
Daily Alert May 14: TriState Capital Holdings, Inc.; 6.75% Fixed-to-Float, Non-Cumulative, Perpetual (TSCAP) from Forbes/Lehmann Income Securities Investor

Monthly Issue May 9: The Spotlight Stock is Discover Financial Services (DFS). While best known for its credit card business, Discover offers a variety of services, from home-equity and student loans to deposit products. Nancy’s Feature explores its benefits.

Cabot’s 10 Best Takeover Stocks.

Special Report May 3: There are a variety of reasons that a corporation might want to purchase another company. They might want to acquire a company’s patents or products to enhance their product lines; access the company’s distribution network and sales relationships; or simply aim to increase their earnings growth rate by purchasing a very profitable company within a related industry. After all, stronger earnings growth leads to better share price appreciation—a topic that boards of directors care very much about. Crista’s investment strategy, which combines both growth and value criteria, inadvertently identifies potential takeover targets. That’s because big companies and she often seek the same thing: stock investments in undervalued, financially thriving companies that can deliver profits to investors. The ten companies are all undervalued growth stocks. What’s more, they’re small enough that big competitors and peers within their sectors could easily finance their acquisitions, often through current cash flow.

Cabot’s 10 Best Covered Calls on Dividend Stocks.

Special Report April 12: With interest rates just coming off of historically low levels, income investors have been desperately searching for alternative sources of yield. Dividend stocks are the obvious answer. But there’s an even better way to create yield: by executing a covered call strategy on stocks that pay dividends.

Cabot’s 10 Best Small-Cap Cloud Computing Stocks to Buy Now

Special Report Updated April 15: If you’re a growth investor, you need to own cloud software stocks. It’s just that simple. Cloud computing is changing the world. It’s powering massive growth in companies across sectors, empowering digital transformations, enabling new generations of connected technologies and changing how people live their lives. Tyler Laundon lays out the landscape and names his 10 best small-cap cloud computing stocks.

This Week’s Q&As

Cabot Emerging Markets Investor

Question: I have been following this stock since you placed this on the watch list and have read your commentary the last two days on IPO’s. However on this one, I have granted myself an exclusion and bought in at $20.22. I will use a no tolerance rule of a close below $20. to protect myself. Out side of the mass market and all of the other appeals mentioned by you and in other articles, my final decision was based on the $20. level being aggressively defended a few times now and a metric I see in my Schwab screen showing that institutional ownership is growing very rapidly right now. Last week ownership was reported at 12% but this morning it was reported as 29%. Recent volumes would seem to support that but again I will be monitoring this one very closely. This was a great find, thanks for bringing this to our attention.

Paul: Glad you like IQ. I also think it’s got great potential. My only suggested change to your guidelines is that I think your suggested stop-loss at 20 is so tight that you’re in danger of being stopped out on normal volatility. IQ is still working on its post-IPO base, and could use a little more wiggle room.

Cabot Undervalued Stocks Advisor

Question: There have been three headline events at Southwest Airlines (LUV) recently. It takes a long time to rebuild trust, especially if lives are at stake. Do you think this news can/will negatively impact the share price.

Crista: Southwest’s recent events have been relatively minor in the grand scheme of airline problems and disasters. Southwest didn’t beat up a doctor and drag him off a flight, kill people’s dogs, or crash a plane full of people. Granted, the engine blowout killed a woman, and I’m very sorry that happened. I don’t remotely mean to make light of her death. The other types of scandals and disasters that I listed would be worse for the share price. At the same time, I need to point out that people who fly frequently are very attached to their travel rewards programs, and as much as they talk about “never flying United again”, they rarely change their travel behaviors, despite their temporary outrage. I am not hesitant about my position in LUV. The fundamentals are very attractive, and investors can always use a stop-loss order if they’re worried about a crisis scenario plummeting the share price.

Wall Street’s Best Daily

Question: I have been a Cabot subscriber for many years (with your father, Carlton - I still have a number of red binders!). I have recently added the Emerging Markets and I have been intrigued by your “Forever” stocks. These stocks are frequently recommended also by the Cabot Growth or Emerging Markets letters. My dilema comes when the newsletters sell a stock that is “forever” ie. Facebook or Tencent. Should I also sell this from my ‘Forever Account’? Will there be occasional comments on these “sold” forever stocks. The hardest part of investing for me is knowing when to sell. I have learned that as long as you have a profit you should be happy, but I am relying on the expertise from your company to help me make these decisions. Also there are some Sells that are done to raise capital even though you still like them ie. HUBS and FANG. I have not sold these but I do not believe that you will comment again and this leaves me a little in the dark as to when to really sell! Generally I follow the advise of the letters that I get but the Forever situation has me stumped. Another recommendation that I followed was for CO and this has not been commented on since. If nothing else, can I count on a sell recommendation announced at some time in the future? I look forward to your comments.

Tim: You ask good questions, and there are no easy answers. Well, the simple answers are that once an advisor has sold a stock, he may never comment on it again—likewise, that I may never comment on the “forever stocks” again. However, you are free to email us at any time to get an updated opinion. Looking at CO, for example, I see a nice base being built after the cooling off phase. If I owned it, I’d hold it. However, I will say that there is a risk of owning too many “forever stocks” and getting into a position of not owning enough of today’s top performers. I have found for my own purposes that 20 stocks is enough to manage, and theoretically, I might own as many as five “forever” stocks in that portfolio. Alternatively, I can imagine owning 30 stocks if the ten additional were “forever stocks.”

Guide to Cabot Prime

This Guide to Cabot Prime will help you make the best use of your Prime membership to create a strong personal portfolio.