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Weekly Summary April 10, 2020

Cabot Prime Pro Week Ending April 10, 2020

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, Tyler Laundon offers his opinion on why investor risk appetite jumped this week. He suggests investors try and maintain a conservatively optimistic outlook and stick to taking small positions, for now. Tyler gets into several higher-risk names that posted a good week and should be of interest for risk-tolerant investors that want to position for an economic recovery in the back half of 2020 and into 2021.

CABOT EVENTS:

Cabot Prime Members Meeting with the Analysts: 2nd Quarter 2020 - Wednesday, April 15 Register Here.

My Favorite Growth Stocks for the Coming Coronavirus Recovery

FREE WEBINAR: Wednesday, April 22 By Timothy Lutts, Chief Analyst of Cabot Stock of the Week and Cabot Marijuana Investor
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2020 Cabot Wealth Summit - August 19-21, 2020

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Advisory Services

Cabot Growth Investor

Bi-weekly Issue April 9: Mike writes that now’s the time to form a game plan. For us, that means remaining defensive until more legitimate bullish evidence emerges—tonight, we have no changes, as the Model Portfolio remains solidly in the black for the year. If the rally fails, he’ll obviously stay in our bunker, but should the Tides turn positive, he’ll aim to put a chunk of money to work

Bi-weekly Update April 2: Remain defensive. There are good and bad aspects to the market’s short-term action; overall, Mike is optimistic a bottom-building process is underway, but he’ll see how it goes. He’s not ruling out nibbling on one or two stocks if the buyers show some mettle, but with our market timing indicators negative, he’s content to hold plenty of cash and patiently wait for the next move up. The Model Portfolio remains in good shape; Mike has no changes tonight and is holding 70% in cash.

Other Stocks of Interest April 10: Follow ups to stocks featured November 21, 2019 (issue 1433) to April 9, 2020 (issue 1443). Since many of the stocks written about in Other Stocks of Interest don’t make their way into the Model Portfolio, you won’t see them followed on a regular basis in the issues. However, we are monitoring these stocks, and this listing gives you a quick view of our latest thoughts.

Cabot Top Ten Trader

Movers & Shakers April 10: Despite the market finally rallying strongly, the intermediate-term trend hasn’t changed—by our measures, it’s still down, and it’s worth noting that all major indexes are still below their 50-day and 200-day moving averages. Plus, this week was one of rotation, as most resilient stocks actually backed off while money chased the beaten-down areas like financials and transports. Mike will be watching closely, but until the market proves itself on the upside, we’re sticking with a defensive stance.

Weekly Issue April 6: Right now, the overall evidence remains unchanged: The trend of the major indexes and most stocks is still pointed down, and while many names are doing a good job of hanging in there, few stocks are in true uptrends. Looking ahead, the first sign of light would be a batch of growth-oriented stocks bursting to new highs, followed by the intermediate-term trend of the major indexes turning up. Given the unprecedented situation, Mike is open to anything, but until the buyers show more muscle, he advises sticking with a mostly defensive stance. The good news is that he continues to see quite a few stocks that institutions have been accumulating in recent weeks. This week’s list has a few, with his Top Pick is Livongo (LVGO), a newer, fast-growing name that’s popped up of late.

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 Position Update April 9: Our Financials ETF (XLF) position is off to a great start as the ETF is trading higher by 5% today. Jacob is going to continue to hold his position looking for greater upside.

Cabot Options Trader Basic and Pro Alert April 8: Buy Half of a Position: Buy the Financials ETF (XLF) January 23 Calls (exp. 1/15/2021) for $2.30 or less.

Cabot Options Trader Basic and Pro Alert April 6: Covered Call: Buy Dropbox (DBX) Stock and Sell the April 18.5 Call (exp. 4/17) for a net price of $17.90 or less.

Cabot Options Trader Pro Weekly Update April 6: Jacob has 4 Long positions: JD, SPY Iron Condor, TSM and Z.

Cabot Options Trader Weekly Update April 6: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week at 46.8, or lower by 29%. This was an interesting situation as the VIX fell dramatically despite the indexes closing Friday near the lows of the week. While some might interpret the VIX falling as bullish as traders are less fearful of a market fall, when stepping back we see that the likely reason for the VIX’s decline is that daily volatility of the S&P 500 has been declining, with “only” an average move of 2.6% last week.

Cabot Undervalued Stocks Advisor

Weekly Update April 8: Crista expects to be adding and removing stocks from these portfolios in 2020, more frequently than usual. That’s because when a stock market recovers from a big drop, stocks tend to get stuck in trading ranges. There are many stocks that are rising today, so she’ll wait a short while before removing any of them. Here are today’s portfolio changes: Broadcom (AVGO) moves from Buy to Hold, Equitable Holdings (EQH) moves from Hold to Strong Buy, Guess?, Inc. (GES) moves from the Growth & Income Portfolio to the Special Situation and Movie Star Portfolio, NV5 Global (NVEE) joins the Growth Portfolio as a Strong Buy and Voya Financial (VOYA) moves from Hold to Strong Buy.

Monthly Issue April 1: Crista’s featured companies today are benefiting from the current focus on healthcare, online commerce, dining at home and limited travel behaviors. These companies are Amazon.com (AMZN); Bristol-Myers Squibb (BMY), a new addition to the Growth & Income Portfolio; Mercury General Group (MCY) and Tyson Foods (TSN). Here are today’s portfolio changes: Abercrombie & Fitch (ANF) moves from Hold to Buy, Adobe Systems (ADBE) moves to the Special Situation and Movie Star Portfolio, Bristol-Myers Squibb (BMY) joins the Growth & Income Portfolio as a Strong Buy, General Motors (GM) moves from Hold to Buy, Goldman Sachs Group (GS) moves from Hold to Retired, MKS Instruments (MKSI) moves from Hold to Strong Buy, Netflix (NFLX) moves from Strong Buy to Hold, Quanta Services (PWR) moves from Hold to Buy, Total SA (TOT) moves from Hold to Buy, Universal Electronics (UEIC) moves from Hold to Strong Buy and VanEck Vectors Oil Refiners ETF (CRAK) moves from Hold to Strong Buy.

Cabot Stock of the Week

Weekly Issue April 6: The action of the best growth stocks gives us a clue as to developing leadership, and the best value stocks are absurdly cheap. Plus, many are paying huge dividends! That’s the case with today’s recommendation, Marathon Petroleum (MPC), a giant in the oil industry. As for the rest of the portfolio, it’s acting well (with a couple of very strong stocks in the mix), and so Tim has no changes today.

Special Bulletin April 2: Luckin Coffee (LK) shares fell sharply today after the company announced that it had suspended CFO Jan Liu and several employees reporting to him for misconduct related to “fabricated transactions.” Tim believes that the stock is now unsuited for the Cabot Stock of the Week portfolio and thus he will attempt to identify a better sell point in the days ahead.

Cabot Global Stocks Explorer

Bi-weekly Update April 9: Most positions are up 5%-6% for the week. The exceptions are Virgin Galactic (SPCE), up 15%, and Luckin Coffee (LK), shares were put on an exchange-mandated trading halt yesterday morning at 4.39. Today, Carl offers us a strategy that looks at micro-cap stocks in a different way. He has no portfolio changes today.

Bi-weekly Issue April 2: With the cash we have in the portfolio, Carl is moving forward with a dual strategy. First, on market weakness, he’ll incrementally add stocks with the goal of doubling their value within a 12-month period. Second, under the assumption that markets will remain volatile and in some sort of trading range, he’ll be looking for great trading opportunities with buys on pullbacks and sells on surges. Today’s featured stock is DBS Bank (DBSDY), one of the largest banks in Southeast Asia with a presence in 18 markets. Carl also updates us on Luckin Coffee (LK), who suspended its CFO Jian Liu and “several employees reporting to him” for misconduct related to “fabricated transactions.” He is also recommends moving Direxion S&P 500 Bear (SPDN) from a 15% Position To 10% Position.

Cabot Small-Cap Confidential

Weekly Update April 9: The message to investors is clear – the economy and financial markets are being bailed out by unlimited amounts of monetary and fiscal stimulus. While one can parse the details and find examples of too little here and too much there the big-picture takeaway should be that, for now, investors are getting their bailout too. That’s why Tyler is not dumping stocks. In the absence of the above measures this health care crisis would have already evolved into a financial crisis and depression. Stocks would have cratered more than they did. In many ways we should be thankful for the financial crisis of 2008-09 since much of the playbook was sitting there on the shelf and just needed to be dusted off and expanded upon. He has no portfolio changes today.

Monthly Issue April 2: This month Tyler is looking past all the current uncertainty in the market at a profitable, young company that should hold its own during this rough patch then accelerate growth into the back half of 2020 (assuming the pandemic eases as we move into the summer months). Ping Identity Holding Corp. (PING) offers intelligent identity solutions for global enterprises. These solutions are strategic imperatives because they help workers do their job from anywhere and help companies streamline customer experiences. Tyler is starting with a half position.

Cabot Dividend Investor

Monthly Issue April 8: While Tom believes the economy and the markets will recover, there is a good chance of another down leg in the market. In this issue, he seeks to take advantage of that possibility by targeting great companies to buy at below current prices. These are fantastic companies to own that are only ever cheap in bear markets like this. He has one portfolio change today, Verizon (VZ) moves from HOLD to BUY.

Weekly Update April 1: Market volatility in this Coronavirus stricken world will likely continue for some time. After falling over 30% in record time, the market has had a nice rebound. In less than a week the market jumped 15% from the lows. It has since stabilized somewhat with less volatility. While the worst may be over, Tom doesn’t think we’re out of the woods yet. He has one rating change today: Brookfield Infrastructure Partners (BIP) moves from Hold to Buy.

Cabot Marijuana Investor

Monthly Issue March 25: Coming into this week, the portfolio was more than 60% in cash, though that’s been reduced as the stocks have bounced. And today Tim is going to take the cash level down to 50% by averaging up (using equal amounts) in both Canopy Growth (CGC) and Innovative Industrial Properties (IIPR). Note, he’s like to buy more of CURLF and GRWG, but he learned long ago that averaging down is a bad idea, so he’s just wait until our position is profitable in them. Canopy Growth (CGC), GrowGeneration (GRWG) and Innovative Industrial Properties (IIPR) all move to BUY.

Update March 19: Looking ahead, there’s no question that this bear market will bottom someday and Tim has little doubt that there will be some big up days, as good news sparks buying by opportunistic bargain hunters. But, today he is going to get even more heavily into cash by selling two more stocks, Akerna (KERN) and Planet 13 (PLNHF), and selling half of Curaleaf Holdings (CURLF). After these moves, the portfolio will be roughly 65% in cash.

Cabot Early Opportunities

Special Bulletin March 27: Kornit Digital (KRNT) has just pulled Q1 2020 guidance, saying revenue will be roughly 35% to 45% below the low end of its prior revenue guidance ($47 million) due to global disruptions from COVID-19. Management cited several customers postponing orders or ceasing operating entirely for now. Tyler is dropping Kornit to focus on titles that have a better chance of performing well in the near-term. It will go back on my watch list for potential inclusion in the future. SELL.

Monthly Issue March 19: These are harrowing times to be an investor but we’re always on the hunt for emerging opportunities, regardless of market conditions. As always Tyler is spreading things around this month, with the focus on two defensive names (including one larger company), two beaten and battered names that seem mis-priced (depends on what happens) and one stock that seems to be in high demand, despite the market conditions. Suffice to say, there’s little incentive to place big bets right now. But we’d be remiss not so send some ideas your way. These new names will come with a short leash! His Top Pick is BlackLine (BL), which was featured in one of his Special Reports last September. It is a Software-as-a-Service (SaaS) business with products for finance and accounting departments.

Monthly Issue March 18: Tyler writes that we will get through this and there will be plenty of opportunities. His overarching message right now is to get (and stay) in a safe financial (and physical) position to be able to take advantage of them when they do. In terms of stocks to buy today, he is not recommending anything. He’ll be following up tomorrow with ideas of what’s looking enticing right now, including some names both in our portfolio and beyond.

Bonus Report:

3 Cloud Software Stocks to Buy Now

Updated - 1/27/20 - Bonus Report: 3 Canadian Small-Cap Stocks to Buy Now
Bonus Report: Secrets To Early-Stage Stock Profits
Bonus Report:

The 240% Early-Stage Growth Stock

Cabot Profit Booster

Weekly Issue April 7: Sprouts Farmers Market (SFM) - Organic food is a nearly $50 billion-per-year industry in the U.S., comprising 6% of total food sales in 2018, and it’s growing at 6% annually. Whole Foods is the obvious, well-known chain that’s capitalizing on this trend, with Trader Joe’s being another that’s popular in certain areas of the country. Less famous, but with a bright future, is Sprouts Farmers Market, a U.S. supermarket chain specializing in natural and organic foods, focusing on fresh produce, bulk foods, vitamins and an array of household wares. The Covered Call TradeBuy Sprouts Farmers Market (SFM) Stock at 19.5, Sell to Open May 20 Calls (exp. 5/15/2020) for $0.80, or a Net Price of 18.7 or less.

Frequently Asked Questions Report:

Frequently Asked Questions

Bonus Report:

Best-Kept Hedge Fund Secrets to Explode Your Wealth

Bonus Report:

5 Easy Stock-Picking Secrets That Make it Ridiculously Easy to Profit.

Bonus Report:

The Simple Technique that Brings in 5%-15% Each Month.

Wall Street’s Best Investments

Daily Alert April 10: ManTech International Corporation (MANT) Upside
Daily Alert April 9: The Allstate Corporation (ALL-PI) Income Securities Investor
Daily Alert April 8: Take-Two Interactive Software, Inc. (TTWO) Forecasts & Strategies
Daily Alert April 7: Micron Technology, Inc. (MU) Personal Wealth Advisor
Daily Alert April 6: Blackline, Inc. (BL) Cabot Stock of the Week

Monthly Issue March 19: Nancy’s Spotlight Stock, DuPont de Nemours, Inc. (DD), is a very old company, founded in 1802. It’s pretty much seen it all—recessions, depressions, booms and busts. And while it’s gone through a number of transformations (including one currently), it’s a steady name and being the largest chemical company in the United States gives it a good base of customers and products. Her Feature article adds a bit more information about the company, the industry, and why investors should keep it in mind.

Ask the Experts

Cabot Profit Booster

Question: I have a question regarding your newest advisory, Cabot Profit Booster. In the presentation, it says that you can make money by getting the profits from stocks price rising. My question is:
Can I profit from the stock gains by selling covered calls? I mean, I know that if your stock price goes over the strike price, you only get that difference of price (strike price minus stock price).
What if one of Mike’s stocks soars 20% in a month, let’s say. Will I be able to profit from this stock price rising or just from the covered call? I know that if the price of the stock rises above the strike price, you are forced to sell the stock. wish you could clear it up for me, if possible.

Jacob: Great question. So this is what I will say ...Yes you can make money on the stock rising if you execute a Covered Call. However, yes your upside is limited. Let’s say we bought stock XYZ that is trading at 90, and then sold the 100 call. We would make money on the stock rising from 90 to 100. However, at that point we would no longer profit if the stock surged higher. That is the “downside” to covered calls. The upside is you made money on the stock going up $10, plus you receive the premium from selling the call. And if the stock pays a dividend then that is also yours. In essence in a wild bull market Covered Calls will yield you 10-15%, but you give up the home run potential.

Premium Reports

Quarterly Cabot Analyst Meeting

The recording of the Special Market Update for Cabot Prime Members Meeting from March 31, 2020 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.

A Richer Retirement

Special Report This handbook is designed to help you secure a better, longer, richer retirement for yourself by making the most of your savings both before and during retirement.

Guide to Cabot Prime Pro

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

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
AAPLStrong Buy
ABBVBuyBuy
ADBEStrong Buy
ALXNBuy
AMZNStrong Buy
ANFBuy
APPFHold
AREHold
ARNABuy
AVGOHold
AVLRHold
BABABuy
BIPBuy
BKRHold
BLBuy
BMYStrong Buy
BPBuy 1/2
BSCLBuy 1/2
CCIBuy
CDLXHold
CGCSee Advisory
CHCTHold 1/3
CRAKStrong Buy
CRONSee Advisory
CURLFSee Advisory
DBIBuy
DBSDYBuy
DOCUHold
DOMOHold 1/2
DOWBuy
DXCMHold
EPDHold
EQHStrong Buy
EVBGHold
EVERHold 1/2
FVRRHold
GESHold
GMBuy
GRWGSee Advisory
GSHDHold 3/4
HCATHold
HTHTHold
IIPRSee AdvisoryHold
INSPHold
LGIHHold
LKHoldHold
LXBuy 1/2
MCYStrong Buy
MKSIStrong Buy
MOHold
MPCBuyBuy
NEEHoldHold 1/2
NFLXHold
NVDABuyStrong Buy
NVEEStrong Buy
PGXBuy 1/2
PINGBuy 1/2
PNGAYBuy
PWRBuy
QCOMHold
QTWOHold
RGENHold
RNGHold
SEBuy 1/2Hold
SPCEBuy a HalfHold
SPDNBuy
STAGHold
TCNNFSee Advisory
TDOCHold
TOTBuy
TPBSee Advisory
TSLAHold
TSNStrong Buy
UEICStrong Buy
VLOHold
VOYAStrong Buy
VRTXHoldHold
VZBuy
XELHold 2/3
ZMBuy