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Weekly Summary April 26, 2019

Cabot Prime Pro Week Week Ending April 26, 2019

Stock Recommendation Tracker

By request, we have added a new feature to your Cabot Prime Weekly Summary—the Stock Recommendation Tracker. It 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 to the portfolios or any changes to our recommendations over the previous week. We will 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, chief analyst of Cabot Small Cap Confidential discusses the broad market’s recent new high and GDP growth surprise. He also delves into why small-cap stocks haven’t broken out of their trading range. He sees potential in large-cap technology stocks that have reported and suggests a wait-and-see strategy for some that are set to report soon. Down the market cap curve Tyler introduces you to smaller companies that should be on your watch list before they report earnings in May.

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Advisory Services

Cabot Growth Investor

Bi-weekly Issue April 25: It’s still a bull market, so we remain heavily invested, but Mike’s main focus right now is (as usual) on growth stocks, especially those in the broad technology field—most have suffered three brief selling waves since late March, and the question is whether those waves are the front edge of a larger distribution phase coming up … or whether, given that most leaders have held up during this choppy phase, the selling was set to peter out. Mike is close to putting a chunk of our 17% cash position to work as he’s spying two or three stocks closely for entry points, but tonight, he’ll stand pat—but will let you know in the days ahead if he makes any moves.

Bi-weekly Update April 18: Remain bullish, but keep your antennae up. Technology-related growth stocks have again come under pressure and many are near key intermediate-term inflection points. (Leaders from other groups still generally look fine.) Much more weakness could have Mike paring back a bit, but tonight he has no changes since even the stocks that have been dinged are holding support. Our cash position is 17%.

Other Stocks of Interest April 12: Follow ups to stocks featured November 7, 2018 (issue 1406) to April 11, 2019 (issue 1476). 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 April 26: It’s been a decent week for the market, with the S&P 500 and Nasdaq each up modestly. But as has been the case in recent weeks, it really depends on where you look—this week was another one of rotation on an almost daily basis. Mike’s buy ideas this week are: Broadcom (AVGO), Huazhu Group (HTHT), Match.com (MTCH) and Sea Ltd. (SE). He has three outright sells this week: iRobot (IRBT), Tencent Music (TME) and Xilinx (XLNX).

Weekly Issue April 22: The market continues to ping pong around, with the major indexes alternating up and down days and, under the surface, rotation whipping names around on a weekly basis. That’s a small reason for concern, and Mike is knocking the Market Monitor back down a notch, but overall he is still bullish—the trends for most indexes and stocks are pointed up. This week’s list has another batch of newer names from a variety of industries, and Mike’s Top Pick is Qualcomm (QCOM), which has shown extreme power after a game-changing deal with Apple last week. We’re OK buying 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 Market Update April 26: Starbucks (SBUX) is trading lower by $0.40 today following earnings which were mostly mixed. Big picture, in light of some of the earnings blowups the last couple days, the $0.40 decline is manageable as the stock has been on a really big run.

Cabot Options Trader Stock on Watch April 25: Marvell Technology (MRVL) has been on a big run in recent weeks having rallied from 19.50 in early April to a high at 25.40 today. And throughout this rally, there has been steady call buying activity, and today the buying has continued. Should the stock and option continue to be strong, MRVL is a top candidate for a new position (though likely with a longer date option).

Cabot Options Trader Video—Option Activity Reviewed April 25: In this video, Jacob breaks down the option activity from Wednesday, which for the first time in several weeks was bearish.

Cabot Options Trader Earnings April 25: Microsoft (MSFT) reported earnings and revenues last night that easily beat earnings expectations. Starbucks (SBUX) is the next stock in our portfolio to report earnings later this afternoon. Jacob is going to hold his position through earnings as the stock looks terrific, and he has a profit on half of the position already in the bank.

Cabot Options Trader Earnings April 24: Jacob updates us on eight stocks that will be reporting earnings either tonight after the close or tomorrow morning.

Cabot Options Trader Stock on Watch April 23: One stock that is breaking out in a big way ahead of earnings is Qualcomm (QCOM), which has rallied nearly $30 in one week. The initial spark for this rally was the announcement of a six-year license agreement between QCOM and Apple (AAPL), part of a deal that ends all litigation between the companies.

Cabot Options Trader Pro Alert April 23: Adjust Existing Position: Against your Microsoft (MSFT) October 115 Calls, Sell the October 135 Calls for $2.75 or more.

Cabot Options Trader Alert April 22: Adjust Existing Position: Against your Regions Financial (RF) Stock Position, Sell the June 16 Calls for $0.22 or more.

Cabot Options Trader Weekly Market Update April 22: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week at 12, or essentially unchanged on the week. This extremely low level in the VIX, which hit a new year-to-date low on Wednesday, is not surprising as the S&P 500 is within 1% of all-time highs and the index has been in a 1% range for two weeks. That said, the price may be getting right for a new bearish position/hedge as there have been some signs of weakness under the surface of the market. Those yellow flags that Jacob is seeing are a recent weakness in growth stocks as well as the healthcare and biotech sectors.

Cabot Options Trader Pro Weekly Market Update April 22: Jacob has eight long positions: GLW, JD, LULU, LVS, MSFT, RF, SBUX and SE, and one short position, QQQ.

Cabot Undervalued Stocks Advisor

Special Bulletin April 23: Yesterday, Guess?, Inc. (GES) announced that the company will cut its quarterly dividend in half, from $0.225 to $0.1125 per share. The company intends to issue convertible five-year notes, and use the proceeds to repurchase common stock. As soon as the share price stabilizes and begins to turn upward, Crista will move the stock from a Hold to a Buy recommendation. Hold.

Weekly Update April 23: Crista writes about Blackstone Group’s (BX) corporate conversion. And, there are three portfolio changes today: Comerica (CMA) moves from Strong Buy to Hold, Designer Brands (DBI) moves from Strong Buy to Hold and Guess? (GES) moves from Strong Buy to Hold.

Special Bulletin April 22: Apollo Global Management (APO) is rising, CF Industries Holdings (CF) moves from Buy to Strong Buy and Synchrony Financial (SYF) begins a new run-up.

If you missed Crista’s webinar Thursday, April 18, Great Growth & Value Stocks That Are Poised for Immediate Upside, you can click here to listen to it.
Monthly Issue April 2: Crista writes of two unusual changes that are happening within the portfolio stocks today. DSW Inc. (DSW) officially changes its name and stock symbol to Designer Brands (DBI); and Dow Inc. (DOW) begins trading separately from DowDuPont (DWDP). She also has quite a few changes today: Comerica (CMA) moves from Buy to Strong Buy, Dow Inc. (DOW) joins the Growth & Income Portfolio with a Buy recommendation, DowDuPont (DWDP) moves from Strong Buy to Buy, DSW Inc. (DSW) changed their name to Designer Brands (DBI), Schlumberger (SLB) moves from Hold to Buy and Synchrony Financial (SYF) moves from Hold to Strong Buy.

Cabot Stock of the Week

Weekly Issue April 23: The market remains in good health, and all Cabot’s market timing indicators are positive, telling us the odds are that the market will be higher in the months ahead. Today’s recommendation is, Brookfield Infrastructure Partners (BIP) a somewhat unusual investment, a high-yielding limited partnership that may avoid the cycles of a notoriously cyclical sector, while offering substantial upside potential. It was originally recommended by Tom Hutchinson in Cabot Dividend Investor. Tim has one portfolio change tonight, Apollo Global Management (APO) moves from Buy to Sell.

Cabot Emerging Markets Investor

Bi-weekly Update April 25: Our EEM Signal slipped below its 20-day moving average this morning and is right on top of its 50-day average. Carl will remain positive and constructive but lean toward finding some bargains. Most likely, the next two ideas will come from heavyweights India and China. He has one portfolio change today: Van Eck Rare Earths/Strategic Metals (REMX) moves from Hold a Half to Sell.

Bi-weekly Issue April 18: Emerging markets stay strong into the second quarter with China leading the way and calming markets with Beijing delivering a 6% growth number. Carl’s new recommendation is Largo Resources (LGORF), a company that delivers a key ingredient that turns steel into “super steel” as well as playing a key role in electrifying the grid. He has one portfolio change today: TAL Education (TAL) moves from Hold a Half to Sell due to relative underperformance.

Cabot Small-Cap Confidential

Weekly Update April 26: In today’s Update Tyler says that for the most part things are looking great. A few positions, like CareDx (CDNA), have lost some of their shine. But overall our portfolio was up around 5% this week, led by a jump in Upland Software (UPLD). And that doesn’t include a big upside move in Repligen (RGEN) this morning. There are two portfolio changes today, AppFolio (APPF) moves from BUY to HOLD and Avalara (AVLR) from HOLD to BUY.

Monthly Issue April 5: Today’s stock, Quanterix (QTRX), is an exciting story of a young company that appears to be in the early innings of its growth curve, but has made it far enough with respect to technology development, customers and strategic partnerships to attract attention from larger investors. Revenue was up 60% in 2018, and is projected to keep growing at a rapid rate. Tyler also updates all the stocks in the portfolio and has one change today: Avalara (AVLR) moves from to Buy to Hold.

Cabot Dividend Investor

Monthly Issue April 24: Tom writes that things are good. The economy appears to be stronger than most expected. The Atlanta Fed is estimating first-quarter GDP growth at 2.8%. That’s a sweet number considering that the first quarter tends to be about 1% slower than the rest of the year. Housing starts and consumer confidence are strong and now it appears that the global economy is also in better shape than previously forecast. His featured stock this month is, Intel Corporation (INTC), the largest computer chip maker in the world. The company has over $70 billion in annual revenues and $264 billion in market capitalization. INTC is being added to the Dividend Growth Tier. Tom has no other portfolio changes today.

Weekly Update April 17: Tom writes that the bull market lives, and probably for a while longer. Those who were preaching gloom and doom last December have been proven wrong and the economy is actually in pretty good shape. Of course, there could be a recession looming two years out. He doesn’t know. But it seems clear that no recession looms on the radar, a year or less from now. There is one portfolio change today: Tom is selling Hormel Foods (HRL) –This is an excellent food company that had a fantastic year last year in a turbulent market, returning over 30%. But the stock has run out of momentum while other defensive stocks have been going strong. Sell.

Cabot Marijuana Investor

Monthly Issue April 25: The main trend remains up, in both the broad market and the cannabis sector in particular. When these uptrends will end, no one knows, but Tim guarantees that they will someday. Long-term, however, he remains very bullish on both the companies and the stocks in the industry and continue to adjust the portfolio’s holdings to optimize growth (with reasonable security.) Today the portfolio is adding a new position in CannTrust (CTST) and averaging up in HEXO (HEXO), taking the portfolio’s cash down to 10% and splitting the proceeds between both stocks.

Update April 18: As of today, the Marijuana Index was up 41.6% year-to-date, while our Marijuana Portfolio was up 50.4%, the difference attributable not so much to stock selection as to stock weighting. Tim is making several adjustments today and is adding two new positions: The portfolio will now sell half of its Aphria (APHA) position, sell half of its Aurora (ACB)position, sell half of its Cronos (CRON) position, and sell half of its Turning Point Brands (TPB) position. This will take the portfolio to about 24% cash. Then Tim will take a fourth of that cash and split it among new positions in Charlotte’s Web Holdings (CWBHF) and Village Farms (VFF).

Wall Street’s Best Investments

Daily Alert April 26: Sarepta Therapeutics, Inc. (SRPT) from Argus Weekly Staff Report
Daily Alert April 25: The Estée Lauder Companies Inc. (EL) from The National Investor
Daily Alert April 24: Yum China Holdings, Inc. (YUMC) from Positive Patterns
Daily Alert April 23: Chipotle Mexican Grill, Inc. (CMG) from Cabot Growth Investor
Daily Alert April 22: AutoZone, Inc. (AZO) from Sure Dividend

Monthly Issue April 10: The retail environment is changing rapidly due to e-commerce, with most brick-and-mortar stores trying to find new strategies to survive Amazon. However, Nancy’s Spotlight Stock this month, Costco Wholesale (COST), is one retailer that is finding success in both channels. In her Feature article, she explains a bit more about the company’s strategy and its biggest advantage—consumer loyalty.

Wall Streets Best Dividend Stocks

Daily Alert April 26: Safehold Inc. (SAFE) from Barclay Capital Equity Research
Daily Alert April 25: Prologis, Inc. (PLD) from The Wealth Advisory
Daily Alert April 24: Sell: WestRock Company (WRK) from Cabot Undervalued Stocks Advisor
Daily Alert April 24: Schlumberger Limited (SLB) from Cabot Undervalued Stocks Advisor
Daily Alert April 23: Xtrackers MSCI Japan Hedged Equity ETF (DBJP) from Jack Adamo’s Insiders Plus
Daily Alert April 22: WhiteHorse Finance, Inc. (WHF) from 2 for 1 Stock Split Newsletter

Monthly Issue April 3: Our issue this month begins with Nancy’s Spotlight Stock, Lexington Realty Trust (LXP), a Real Estate Investment Trust that is in the midst of a transformation and whose shares are trading at bargain levels. In her Feature article, Nancy explores the direction in which the REIT is moving, highlighting the opportunities in that sector.

Ask the Experts

Cabot Marijuana Investor

Question: Do you have any idea what will be the next hot sector after marijuana? (Note: this question was asked during last week’s Prime Quarterly Conference, and I have thought about it more since then.)

Tim: In my original answer, I said that’s it’s hard to predict the future; many predictions are simply wrong, like the expectation that 3D printing would be a great growth industry. The fact is, the reality of the 3D printing industry never met the great expectations of investors who bid those stocks up in 2013. Sure, the winning wheelchair racer of the Boston Marathon wore custom 3D printed gloves, but for most of us, there’s no need.So, after thinking about it for a while, I’ve concluded that the best great investment sectors have several characteristics. One, they serve a mass market. These markets start small but they get very big fast. Think of Amazon, Netflix and Uber. Two, they grow faster than expected, thus causing analysts to increasingly raise their earnings projections, which brings in more institutional money. Three, and most important, when these industries begin, they are NOT respected by the majority of the population, mainly because they are disruptive to the status quo, and many people are afraid or skeptical of them. It was true for marijuana, and still is to some extent. There’s a substantial segment of the population that doesn’t approve of the product. Additionally, because of federal legal restrictions, many institutional investors are still not buying the stocks. It was true of Amazon at the start, when experts were skeptical of Amazon’s ability to compete with the established bricks-and-mortar booksellers. It was true of Netflix, when the company announced its crazy idea to send CDs through the U.S. mail. It was true of radio stocks back in the Roaring Twenties, when broadcast technology changed the world, but people feared the invisible force. And it was true—way back—of the early automobile stocks, when people feared the disruption of the horse-and-buggy industry. So, when looking for the next new hot sector, my suggestion is this. First, look for stocks going up. Second, focus on industries that serve true mass markets. Third and most important, gauge the attitude of investors toward the sector, and lean toward those about which the majority of investors are skeptical.

Premium Reports

Cabot Prime Pro Quarterly Report

Special Report

April, 2019: The first quarter of 2019 was as good as the previous one was bad. And that’s not surprising. In fact, in his last quarterly report, Tim concluded by writing, “What the charts are signaling now is quite bullish! So don’t be afraid. Follow your favorite Cabot analyst. Use appropriate risk management tools. And make some money while the market is once again going the right way.”

Cabot’s Ten Best Canadian Small-Cap Stocks

Special Report

Updated March 6, 2019: One of the generally accepted wisdoms over the past couple of years has been that the U.S. stock market is where the action is. But relative performance of ex-U.S. markets is showing that’s no longer the case. There are market-beating returns available to those investors willing to step abroad. And one of the easiest steps to take is just over the border with our neighbor to the north, Canada. For the modestly adventurous investor, I think there are quite a few Canadian stocks worth a look right now.

Cabot’s Best Safe Investments for Uncertain Times

Special Report

December 21: This report gives you some suggestions of the safest, productive places to put your money when the market gets bumpy.

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 Emerging Markets InvestorCabot Growth InvestorCabot Marijuana InvestorCabot Stock of the WeekCabot Undervalued Stocks AdvisorCabot Dividend Investor
AAPLBuyStrong Buy
ABBVBuyBuy
ACBSee Advisory
ALXN Hold
ANFBuy
APHASee Advisory
APOSellStrong Buy
APPFHold
ARNAHold
AVLRBuy
AXPBuy 1/2
BABABuy 1/2
BHGEBuy
BIP BuyBuy
BSCJ Buy 1/2
BSCL Buy 1/2
BXStrong Buy
BZUNBuy 1/2
CDNAHold
CDXSBuy
CFStrong Buy
CGCSee Advisory
CHCTHold
CHEFBuy
CITBuy
CMAHold
CMCStrong Buy
CMGBuy
CRLBFSee Advisory
CRONSee Advisory
CTSTSee Advisory
CURLFSee Advisory
CVNABuy 1/2
CWBHFSee Advisory
DALBuyStrong Buy
DBIHold
DDAIFBuy 1/2
DOWStrong Buy
DWDPBuy
ECL Hold 1/2
ED Hold 2/3
ELLXFSee Advisory
EPAYBuy
EPDBuy
EVBGHoldHold
EXASHold
FIVEBuy
GESHold
GSHDBuy
GTBIFSee Advisory
HEXOSee Advisory
HRL Sold
HTHTHold
IIPRSee Advisory
INTCBuy
ITHUFSee Advisory
LGORFBuy a Small Position
KNXHold
KSHBSee Advisory
LUVHold
LXBuy 1/2Buy
MKC Hold
MPCStrong Buy
MTCHBuy
MOBuy
MOSHold
NEE BuyBuy
NVTA Buy
OGRMFSee Advisory
OKTABuy another Half
PGX Buy 1/2
PLNTBuyBuy
QTRXBuy
QTWOBuy
RCLStrong Buy
REMXSellHold
RGENBuy
RPDHoldHold
SANMStrong Buy
SEHold 1/2
SLBBuy
SSOBuy
STAGHoldHold
SUPNHold
SYFStrong Buy
TALSold
TCEHYBuy
TIVOHold
TOTBuy
TPBSee Advisory
TSLAHold
TTDHold
TWLOBuyBuy
UEICStrong Buy
UPLDBuy
VFFSee Advisory
VOYAHoldHold
WDAYHold
WRKSold
XEL Hold 2/3
ZTOBuy 1/2