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Cabot Prime Pro Week Ending March 19, 2021

Cabot Prime Pro Week Ending March 19, 2021

Stock Recommendation Tracker

The Stock Recommendation Tracker is a table that features all of the current recommendations in all of our portfolios. It’s a quick way for you to see what stocks are currently in our portfolios and will highlight new additions or any changes to our recommendations over the previous week. We include this table at the bottom of the Weekly Summary, and provide a link here at the top to the Stock Recommendations Tracker.

Cabot Weekly Review (Video)

In this week’s stock market video, Mike Cintolo is still in the same stance as he has been for the past couple of weeks — despite the ups and downs, growth is still generally in a correction, while much of the broad market is still trending up (though is extended to the upside a bit). Mike’s biggest thought is that, right now, making money has become difficult as stocks chop around, so it’s best to keep things light and wait patiently for big investors to start a new accumulation phase. Stocks mentioned include W, ABNB, YETI, FDX, FB, CURLF, FANG, SLQT, and LGIH.

UPCOMING CABOT EVENTS:

Cabot Retirement Club Member Call

FREE WEBINAR FOR PRIME MEMBERS ONLY: March 25, 2021 Sign up now.

Cabot Micro-Cap Insider Member Call – April 2021

FREE WEBINAR FOR PRIME MEMBERS ONLY: April 15, 2021 Sign up now.

Cabot Prime Members Meeting with the Analysts: 2nd Quarter 2021

FREE WEBINAR FOR PRIME MEMBERS ONLY: April 21, 2021 Sign up now.

3 Micro-Cap Stocks that Could Triple in the Next Year

FREE WEBINAR FOR PRIME MEMBERS ONLY: April 22, 2021 Sign up now.

Advisory Services

Cabot Growth Investor

Bi-weekly Update March 18: The market has thrashed around in recent days, which hasn’t changed the overall outlook—most of the market remains in decent shape, but growth stocks and the Nasdaq are mired in a correction and there’s still a chance we see another leg down. That doesn’t mean we couldn’t on something here or there for the most part Mike think it’s best to stay close to shore until the sellers finish their work. Mike has no changes tonight and the Model Portfolio remains about 50% in cash.

Bi-weekly Issue March 11: Last year saw a ton of “wow, we haven’t seen this kind of unusual market action in decades!” situations, but instead of reverting back to normal behavior, 2021 has had plenty of tricks up its sleeve as well. The past few weeks has been a good example of that, as growth stocks have cracked their uptrends across the board, while the rest of the market continues to dance to its own bullish tune. Indeed, today, many indexes leapt to fresh all-time highs, even as the Nasdaq itself is hanging around its 50-day line and most growth leaders are still 15% or more off their peaks! However, that’s left us with a huge cash position, so tonight Mike will start a half-sized position in DraftKings (DKNG), which will leave us with right around 50% on the sideline. Mike is changing ProShares Ultra S&P 500 Fund (SSO) to a Buy.

Cabot Top Ten Trader

Movers & Shakers March 19: A week ago we said “up is good,” as the market’s bounce from its lows was a good thing to see—but, at day’s end, didn’t really change the overall environment. And that’s how we feel about this week, but in the opposite sense—we’ve seen renewed selling pressure on the Nasdaq and growth stocks, and this time, even some of the broad market has been caught up in it (like energy names). Mike has three buy recommendations: Cimarex Energy (XEC), Diamondback Energy (FANG) and SelectQuote (SLQT).

Weekly Issue March 15: Up is good, so last week’s rebound in growth and continued push higher in the broad market was encouraging. That said, nothing much has changed with the overall evidence—many areas of the market look just fine, with a few indexes actually hitting all-time highs, but growth stocks are still (mostly) in a corrective mode, with a bunch of names having rallied only into resistance. Mike’s Top Pick is Thor Industries (THO), which looks like the leader of a fresh move for that group. You could nibble here or (preferably) on dips.

Cabot Options Trader and Cabot Options Trader Pro

Note that the current week’s Weekly Update, earnings updates, position updates and stocks on watch are posted on the website in the Market Update section, which is deleted each week.

Cabot Options Trader Basic & Pro Market and Position Update March 18: The fear of rising inflation, and what it means for interest rates and various sectors of the market, continues to be the headliner for the time being. And we can see this in the COT/COTP portfolios in a simple breakdown of cyclicals vs. growth.

Cabot Options Trader Basic & Pro Mental Stops March 16: SONO shares are trading higher for a sixth straight day and making yet another new 52-week high in the process. Options Traders’ June 22.50 Calls continue to move higher, now above $20 per contract and posting a potential gain of 462%. Jacob is moving his mental stop on these calls to $17, up from his previous stop level at $10.

Cabot Options Trader Pro Trade Alert March 16: Close Existing Position: Sell your SNAP April 40/55 Bull Call Spread for $13.5 or more.

Cabot Options Trader Basic & Pro Covid One Year Later March 15: That’s right, the S&P 500 fell nearly 12% on March 16, 2020, its 3rd largest percentage loss in history, while the Nasdaq had its worst percentage fall of all-time! What a day, and subsequent year it’s been! That week we took losses on our XOM and IBM Calls of 90% and 86%. Fortunately those losses were offset by our gain of nearly 500% on our SPY puts. Thank goodness for those puts!

Cabot Options Trader Basic Weekly Update March 15: The Chicago Board of Options Exchange Volatility Index (VIX) spiked higher to start the week on Monday, but then declined every day thereafter. For the full week VIX lost 16.1% to end Friday at 20.69.

Cabot Options Trader Pro Weekly Update March 15: Long positions: FCX, SNAP, SONO, XLF, PINS, UBER, DKNG

Cabot Undervalued Stocks Advisor

Weekly Update March 17: This week, Bruce is adding a new name, Barrick Gold (GOLD) as a Buy. This stock is not only out of favor (a classic contrarian trait), but is not infrequently looked upon with doubt, disdain and discredit. The entire gold mining industry isn’t immune to such views, either. But the gold mining industry, and certainly Barrick, has lost the loose-spending and often murky culture of decades ago. We recently raised price targets for several stocks. With the economy showing broad strength, the earning power of these names are still probably being underestimated.

Monthly Issue March 3: This wouldn’t be a proper value investing letter without mentioning Berkshire Hathaway’s earnings report and chairman Warren Buffett’s annual shareholder letter, released this past Saturday. The earnings were fine, given the pandemic this year, while the letter seemed shorter than typical and more of a reminiscence of the company’s history than sage advice about investing. This week, Bruce is adding a new name that Buffett may appreciate but almost certainly doesn’t own – Aviva, Plc. This London-based insurance company is undergoing an overhaul, led by the highly capable new CEO Amanda Blanc.

Cabot Stock of the Week

Weekly Issue March 15: The broad market remains in a diverging pattern, so there’s still a very good chance that a long-term market top is being formed—and the wild action in SPACS, EV stocks, bitcoin and other digital assets confirms that view. Because of that, our portfolio is now holding some cash. Tim’s featured stock DraftKings (DKNG), is positioned to be one of (if not the) biggest players in online sports betting, iGaming (online casino gambling) and daily fantasy sports, which has taken off in recent years. Tim has no portfolio changes.

Cabot Global Stocks Explorer

Bi-weekly Issue March 18: You can often find exciting and profitable investment ideas at the edge of new technologies. China is accelerating its government-sponsored satellite initiative to beam Internet from space, taking on American rivals SpaceX’s Starlink and Amazon’s Project Kuiper, as well as the United Kingdom’s OneWeb, in the competition to dominate the age of space connectivity. Carl’s new recommendation QuantumScape (QS), is working on some breakthrough electric vehicle battery technology backed by some heavyweight industrialists, as well as Volkswagen. Carl has one portfolio change: Sea Limited (SE) moves from Hold a Half to Buy a Half.

Bi-weekly Update March 11: In a bit of a reversal, tech stocks gyrated and industrial stocks jumped this past week. In particular, energy and financial stocks led the way as the Dow closed above 32,000 for the first time. Tech company stalwarts rebounded a bit yesterday but have been stung by the sharp pullback. One of the most prominent names in SPACs, Chamath Palihapitiya, faced criticism this week after regulatory filings showed that he had sold his entire personal stake in Virgin Galactic (SPCE), an Explorer holding. His response was that he would maintain a stake in Virgin Galactic indirectly through an investment firm and plans to reallocate capital to climate change tech. This spin is not convincing.

Cabot Small-Cap Confidential

Weekly Update March 18: Neither the broad market nor the S&P 600 Small Cap index have done much over the last week. But both received a small boost yesterday after the Fed upgraded its 2021 growth outlook and said it didn’t expect to raise rates until 2024. There are a lot of ways to interpret the Fed’s stance, and there are certainly a wide range of opinions out there. But sometimes it’s best not to overthink things. Taken at face value the message is the Fed will continue to sit pat and see how things go. That makes sense given we’re still so early in a potential recovery, with only around 20% of the U.S. population having received one shot so far. Tyler has no portfolio changes.

Monthly Issue March 4: Tyler’s new recommendation, Kornit Digital (KRNT) designs and manufactures industrial digital printing technologies for the garment, apparel, and home goods markets. It represents a way to play mass-market adoption of digitally printed textiles on a huge range of items, including clothes, sheets, furniture coverings, rugs, curtains, rolled fabric and more. The company has a market cap of $4.7 billion. In 2019 revenue rose by 26% to $180 million. The first half of 2020 was dramatically impacted by Covid-19 related shutdowns. Revenue fell by 32% in Q1 and 17% in Q2.

Cabot Dividend Investor

Weekly Update March 17: What a difference a week makes. It’s been a reversal of fortunes. Technology stocks are soaring and energy stocks are pulling back. Last week, the long dominant technology sector had just experienced a long overdue correction. A week ago Monday the technology stock-heavy Nasdaq Index closed down over 10% from the recent high. But, in the six trading days since, the index has soared about 8%. Tom has no portfolio changes.

Monthly Issue March 10: This is a wild market. Yesterday’s perennial losers are today’s big winners. At the same time, long dominant technology stocks are taking a beating. Cyclical or open-up stocks are on fire, and for good reason. The U.S. economy has far exceeded expectations at every phase of the recovery so far. The vaccines promise to end the remaining lockdowns and restrictions, or significantly curtail them. With the shackles removed, the economy will kick into high gear. Even several normally dour economists are predicting the highest GDP growth in decades this year. Tom’s featured stock KKR & Co. (KKR), is a leading global alternative asset manager. The firm manages multiple alternative asset classes including private equity, energy, infrastructure, real estate, credit, as well as hedge funds through strategic partners. It generates revenues from management fees, performance income and investment income with a global reach on five continents.

Cabot Marijuana Investor

Weekly Update March 17: The good news is that one of our stocks, Trulieve (TCNNF), closed at a record high yesterday. The bad news is that none of our other stocks did. The sector as a whole remains in the moderate correction that began five weeks ago, and Tim continues to think that we are likely to see lower prices in the near future. Long term, of course, the future remains extremely bright for the industry; revenue growth at the leading companies is still extremely rapid, and most Americans have no idea of the world that will exist 10 years from now (to pick a round number) when cannabis products are commonplace in beverages, foods, pharmaceuticals, cosmetics and more.

Monthly Issue February 24: Two weeks ago, just as the sector peaked, our Marijuana Portfolio was up 48% YTD while the Marijuana Index was up 91% (in part due to the Canadian stocks that had rebounded from an oversold position late last year). That’s when I advised selling, based mainly on the action of the charts—which were showing unsustainable parabolic action—but also on the elevated sentiment among investors. Today, the Index has given up nearly half of its gain, while our portfolio has lost far less, thanks to holding plenty of cash and just one Canadian stock. Tim has no portfolio changes.

Cabot Early Opportunities

Monthly Issue March 17: One year and one day ago, on March 16, 2020 the S&P 500 had one of the worst days in history, falling nearly 12%. Of course, that was just one in a horrible stretch of trading days that slashed the index by 35% over the course of six weeks. This advisory service was relatively new at the time and we were just starting to get into a groove when things went crazy. Tyler’s Top Pick is Eargo (EAR), produces high-quality, small, well-fitting and easy-to-use hearing aids, at a reasonable cost. Eargo’s solution ticks all the boxes. It is nearly invisible (fitting completely in the ear canal) and has a lot of technology (including 16 hours per charge) packed into a small form factor.

Special Bulletin March 16: It’s been a week or so of comparatively calm market action, which has given us a chance to evaluate how our current roster of stocks is behaving. With that evidence, and a new batch of stocks coming tomorrow in the March Issue, we’re going to step aside from a few of our weaker performing positions today. Doing this will keep our portfolio to a more manageable number and free up some capital to either direct into new opportunities or hold in cash to be deployed at a later date.

Cabot Profit Booster

March Expiration March 19: Today is the expiration of March options, including five positions in the Cabot Profit Booster portfolio. And I’m happy to report, despite the market being a bit “crazy” the last three weeks, four of our positions will very likely expire today for profits ranging from 4.5% to 18.6%, and one will expire mostly at breakeven.

Weekly Issue March 16: This week is the expiration of March options, and the good news is we appear to be headed to full profits on four of our March positions (JCI, SONO, GS, APHA) and are in good shape with our one position that is unlikely to be called away Friday (DT). Expect to hear from Jacob Thursday afternoon or early Friday morning on these expiring covered calls. Jacob’s new stock recommendation is Summit Materials (SUM).

Cabot Micro-Cap Insider

Weekly Update March 17: After a little volatility in the past couple of weeks, most of our recommendations are at or close to all-time highs. The S&P 500 is back to all-time highs. The NASDAQ Index, after pulling back ~11.0%, has rebounded sharply and is up ~8.0% in a little over a week. In times like these, it’s important to make sure we are checking the fundamentals to ensure our recommendations haven’t run ahead of fair value. We can’t get complacent. Earnings season provides a great time for a fundamental check in because you get additional data points which you can use to determine if your investment case remains on track. This week, BBX Capital (BBXIA) reported its fourth quarter results. The story remains on track.

Monthly Issue March 10: Value investors have waited a long time for this. After suffering through one of the worst periods of relative underperformance ever, value is outperforming. Not only is value outperforming, but it feels like some of the froth is being sucked out of the market. Tesla (TSLA) is down 36% from its all-time highs. Nikola (NKLA) is down 49%. Many SPACs are suddenly trading for less than their cash holdings. Rich’s new recommendation Aptevo Therapeutics (APVO), a biotech company with a promising pipeline yet a very low valuation. Tang Capital has an offer outstanding to purchase the company for 50 per share, significantly above where the stock currently trades.

Cabot Income Advisor

Weekly Update March 17: So much for the technology selloff. The sector dipped its toe into correction territory and has roared back with a vengeance. A week ago yesterday, the technology-stock-heavy Nasdaq Index closed down over 10% from the recent high. It had been a long overdue pullback for a sector that has been on fire much of the past year. But it looks like the sector is right back in business after it got that correction over with. The Nasdaq has rallied about 8% in the past week and already recouped most of the short-lived losses. At the same time, boiling hot energy stocks have pulled back over the past few days. The Energy Select Sector SPDR Fund (XLE) soared a remarkable 35% since February but has pulled back in the past few days.

Monthly Issue February 24: This generally isn’t the best time to buy stocks. Shares in energy, finance and other cyclical sectors have just had a huge run higher and may be due for a consolidation. At the same time, much of the rest of the market is under increasing selling pressure and may be setting up for a more significant, and overdue, downturn. However, it is a very good time to write high-priced calls in stocks that have been soaring higher. That’s why this portfolio has recently written calls on high-flying positions Valero Energy (VLO) and Chevron (CVX). Tom’s featured stock NextEra Energy, Inc. (NEE), is the world’s largest utility. It’s a monster with about $18 billion in annual revenue and a $147 billion market capitalization.

Cabot Turnaround Letter

Weekly Update March 19: The bull market in our turnaround stocks continues to drive several names to prices above our targets. We are reviewing price targets for Adient (ADNT), Macy’s (M), Mohawk (MHK) and Jeld-Wen (JELD). Following investors’ exuberance over Volkswagen’s (VWAGY) aggressive moves into electric vehicles and batteries, as outlined in their investor presentations earlier this week, Bruce moved the shares to a Sell. Click here to listen to the podcast.

Special bulletin March 17: Volkswagen shares surged today, up 32% at the time of this note, following a 10% jump yesterday. At just over $43, or the equivalent of €355 after converting the ADR to ordinary shares, the stock is about 40% above its previous record high set in early 2015. Year-to-date, the shares have gained about 120%. Bruce is moving Volkswagen AG (VWAGY) to a SELL.

Monthly Issue February 24: The energy industry has been through a remarkably difficult time in the past seven years. The collapse of oil prices in mid-2014, from over $110/barrel to less than $25/barrel in early 2020, exerted immense stress on energy companies, particularly those that were bloated with debt from their overzealous pursuit of growth. At the same time, capital markets curtailed their financing of energy companies, worn out by the chronic lack of free cash flow. Several of these companies slid into bankruptcy, yet now look like interesting investment opportunities. Bruce’s has one buy recommendation: Altria Group (MO) and one sell recommendation: Trinity Industries (TRN).

Ask the Experts

Cabot Options Trader

Question: I have a handful of SONO calls expiring in June. The June 18 2021 22.50 calls. Bought for $3.88, trading at about $20 today. Is the best over and it’s time to part?

Jacob: SONO looks like a stock star that has been unfazed by the market wobbles in recent weeks. Because of that I am going to continue to hold my position for as long as I can. That being said, if you want to ring the register on a couple of calls, lock in that profit of 415%, and then hold the balance for even greater upside, that is a fine choice as well.

Quarterly Cabot Analyst Meeting

The recording of the Cabot Prime Members Meeting with the Analysts from January 20, 2021 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.

Stock Recommendations Tracker

The table below lists all of the stocks held in any Cabot portfolio.
Updated or revised recommendations from the past week are in purple text.
Stocks added to a portfolio are highlighted in green text.
Closed stock positions in the past week are highlighted in red text.

StockCabot Small-Cap ConfidentialCabot Global Stocks ExplorerCabot Growth InvestorCabot Marijuana InvestorCabot Stock of the WeekCabot Undervalued Stocks AdvisorCabot Dividend Investor
ABBVHold 2/3
ACCDBuy
APGstrong>Buy
APT.AXHold 1/2
ARNABuy
ATCOBuy 1/2
AVGOBuyBuy
AVLRBuy
AVVIYBuy
BFTBuy 1/2
BIPBuyBuy 2/3
BLFSBuy
BMYStrong Buy
BSCLBuy 1/2
CDLXBuy
CGCSee Advisory
CRLBFSee Advisory
CRNCHold
CSCOBuy
CURLFSee Advisory
CVXBuy
DKNGBuy 1/2Buy
DLRBuy
DOWHold
EPDBuy
EVBGBuy
FIVEBuyBuy
FSRHold 1/2
FVRRHold 1/2
GMHoldHold
GOLDBuy
GRWGSee Advisory
GSHDHold 3/4
GTBIFSee Advisory
HTHTHold
IIPRSee Advisory
IBMBuy
INSPHold
JBLUHold
JUSHFSee AdvisoryHold 2/3
KOBuyBuy
KRNTBuy
LGIQBuy 1/2
LLYHold 2/3
MOBuy
MRKBuy
NEEBuyBuy
NETHold 1/2
NGLOYBuy
NVCRBuy
OBuy
PGNYHold
PGXHold 1/2
PINSHoldHold
PRCHBuy
PROFBuy
QCOMHold 2/3
QSBuy
QTWOBuy
RGENBuy
ROKUHold 3/4
SEBuy 1/2Hold
SOLOSold
SPCEHold 1/2Take Partial Profits
SPOTSold
SPTHold
SSOBuy
STBuy
STAGBuy
TAPHoldBuy
TCNNFSee AdvisoryHold
TPBSee Advisory
TRSSFSee Advisory
TSLAHold
TSMBuy 1/2
TSNBuy
TWLOHold 3/4
UBERHoldHold
USBBuyBuy
VLOHold
VZHold
XELBuy 2/3