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Weekly Summary January 3, 2020

Cabot Prime Pro Week Ending January 3, 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 looks back at what worked well in 2019. Specifically, he takes viewers through the top 10 performing microcap stocks of 2019.

CABOT EVENTS:

Cabot Prime Members Meeting with the Analysts: 1st Quarter 2020

FREE WEBINAR: Wednesday, January 15, 2020 2:00 p.m. Eastern Time Click here to register.
2020 Market Outlook + 3 Stocks to Buy Now

FREE WEBINAR: Thursday, January 23

By Mike Cintolo, Chief Analyst of Cabot Growth Investor and Cabot Top Ten Trader | Space is limited so sign up now for FREE.
SAVE THE DATE

2020 Cabot Wealth Summit - August 19-21, 2020

Click Here for More Information.

Advisory Services

Cabot Growth Investor

Bi-weekly Issue January 2: The market’s outlook hasn’t changed much during the past couple of weeks (longer-term, it’s definitely a bull market, though shorter-term, the odds favor some trickier trading going forward) so our portfolio hasn’t changed much, either. Mike is still mostly invested, but holding a chunk of cash (17%) as he looks for (a) some steam to come off the market and/or (b) some stocks we’re eyeing to offer entry points. He’s generally happy with our current crop of stocks, and as he’s written before, thinks we own some of the leaders of this move. But he’s not complacent, either. That said, right now, Mike is content to observe how things go—January is often a tricky month, and letting things settle out for a bit is usually the right thing to do. He has no changes tonight.

Bi-weekly Update December 26: Remain bullish. The bull market rolls on, and while there are legitimate shorter-term yellow flags (a good reason to be choosy on the buy side), the big-picture outlook is solid. Mike has no changes in the Model Portfolio today.

Other Stocks of Interest December 20: Follow ups to stocks featured August 1, 2019 (issue 1425) to December 19, 2019 (issue 1435). 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. Feel free to email me directly (mike@cabotwealth.com) with any questions/comments you have.

Cabot Top Ten Trader

Movers & Shakers January 3: In the short-term, Mike is leaning toward the view that the market may have finally begun the long-awaited pullback/consolidation—as he wrote recently, the odds favor a trickier environment (news-driven moves, rotation, earnings season soon, etc.) in the weeks ahead that could serve to bring the fear level up. Mike’s buy ideas today are: Arconic (ARNC) and Fortinet (FTNT). He has three sells today: Leggett & Platt (LEG), Murphy USA (MUSA) and Sherwin Williams (SHW).

Weekly Issue December 30: As the year winds to a close, nothing has changed with the market’s overall stance—big picture, it’s a bull market, and numerous factors tell Mike that the uptrend has farther to go; the odds favor higher prices when looking months down the road. Shorter-term, though, there are also many signs that tell us risk is elevated—that doesn’t necessarily mean a huge correction is on tap, but he thinks it’s safe to say that the next few weeks are likely to be more challenging than the past few weeks, with potholes, rotation and news-driven moves possible. Mike’s last list of 2019 is a broad mix of strong stocks, including turnarounds, recent breakouts and fresh setups. His Top Pick is Crocs (CROX), which is benefiting from some rotation into retail titles and a string of solid quarterly reports.

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 Pro Alert January 3: Buy the JD.com (JD) June 39/47 Bull Call Spread (exp. 6/19/2020) for $2.80 or less.

Cabot Options Trader Pro Alert January 3: Sell Existing Position: Sell your JD.com (JD) January 32/38 Bull Call Spreads for $4.90 or more.

Cabot Options Trader Alert January 3: Buy the JD.com (JD) June 39 Calls (exp. 6/19/2020) for $3.80 or less.

Cabot Options Trader Alert January 3: Sell Existing Position: Sell your JD.com (JD) January 32 Calls for $6 or more.

Cabot Options Trader Position Update January 2: As Jacob mentioned before the New Year’s break we were entering a very “funky” time of year as stocks and sectors can come in and out of favor VERY quickly in the first couple days and weeks of January. Today, he gives some examples from the portfolio.

Cabot Options Trader Stocks on Watch December 31: As 2019 comes to a close traders today are actively buying calls in 2019 underperformers looking for these stocks to turn around in 2020. Here are some of those stocks: Square (SQ), Gilead (GILD) and Lyft (LYFT).

Cabot Options Trader Position Update December 30: The S&P 500 is trading lower by 0.6% today. Very quickly this has pushed our S&P 500 ETF (SPY) Puts that were bought on Friday for $8.38 to be worth $9.40, a potential profit of 12%. While Jacob is going to continue to hold his full position, if you would prefer to take your 12% profit in one trading day, that is a fine choice as well.

Cabot Options Trader Pro Weekly Update December 30: Jacob has 8 Long positions: BX, CRM, KO, JD, JBLU, SNAP, TGT and TSM and one short position, SPY.

Cabot Options Trader Weekly Update December 30: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week at 13.43, or higher by 7.35%. This rise in the VIX in a holiday-shortened week in which the market traded higher is a somewhat curious situation as one would assume the VIX would break to a new low given these conditions.

Cabot Undervalued Stocks Advisor

Weekly Update December 31: There was very little news or new analyst research on our portfolio stocks last week. Crista expects a surge in new information by mid-January as businesspeople and Wall Street analysts get back to work after the holidays. In the meantime, her weekly updates will include any of our companies that had meaningful news, or changes in earnings estimates or share prices. Here are today’s portfolio changes: Corteva Inc. (CTVA) moves from Buy to Hold and General Motors (GM) joins the Buy Low Opportunities Portfolio as a Buy.

Monthly Issue December 3: LGI Homes (LGIH) joins the Buy Low Opportunities Portfolio today and Quanta Services (PWR) rejoins the Growth Portfolio. Additionally, Crista says goodbye to CIT Group (CIT), which continues to have a slightly-improving price chart, but the 2020 earnings growth prospects are too dismal to remain in the Growth Portfolio. Other changes today are: Blackstone Group (BX) moves from Strong Buy to Hold and Universal Electronics (UEIC) moves from the Buy Low Opportunities Portfolio to the Growth Portfolio.

Cabot Stock of the Week

Weekly Issue December 31: The broad market remains strong, and all Cabot’s market timing indicators are currently positive, so as we head into the New Year, Tim remains optimistic that we’ll see higher prices in the month ahead. His new recommendation Endava Plc (DAVA), is an English stock (which is rare), but it has a good story as well as a good chart, so prospects are good. The stock was originally recommended by Tyler Laundon in Cabot Early Opportunities. Tim has one portfolio change today: Corteva (CTVA) moves from Buy to Sell.

Cabot Global Stocks Explorer

Bi-weekly Update January 2: Carl is looking forward to putting some new ideas in front of you in the coming year, but today, he takes a look at how global markets fared in 2019. For the most part, global stock markets performed strongly in 2019. He has has one portfolio change today: Grupo Televisa (TV) moves from Hold a Half To Sell.

Bi-weekly Issue December 26: All Explorer positions except Grupo Televisa (TV) advanced this past week and the emerging markets timer (EEM) is positive in an uptrend and above both its 20-day and 50-day moving averages. Carl’s recommendation today is Cosan Ltd. (CZZ), a company showing some relative strength that offers a nice blend of emerging growth and Western management. It’s a business with a diversified portfolio of fuel distribution, sugar production, ethanol and electricity, rail transportation and warehousing as well as the distribution of natural gas.

Cabot Small-Cap Confidential

Monthly Issue January 3: Today’s addition is a familiar story, Model N (MODN) is a small software company with a purpose-built solution that works better than the patchwork of legacy solutions many companies still rely on, but which don’t work very well. But there is another angle. This company is transitioning from an on-premise to a Software-as-a-Service (SaaS) business model. The switch should accelerate growth and make the stock a lot more attractive to investors. Tyler has one portfolio change today: Construction Partners (ROAD) moves from BUY to HOLD.

Weekly Update December 20: The S&P 600 Small Cap Index, which hadn’t broken above 1,000 for most of 2019, is now comfortably above that level and appears to be heading higher. This is significant because there is little in terms of overhead resistance until the index gets back to 1,100. It also illustrates participation from a broader group of sectors (materials, consumer staples, energy, industrials, etc.) than Tyler has seen in recent quarters. He has one portfolio change today: Health Catalyst (HCAT), shares have been dropping by the day on no news so it moves from Buy to Hold.

Cabot Dividend Investor

Weekly Update January 3: Tom says that for now, while the overall market is expensive and near an all-time high, there are still a lot of attractive opportunities, particularly in the long-neglected value stocks. There are also some powerful trends that should drive performance in certain areas of the market in the year ahead, like 5G and marijuana. He likes the way the current portfolio is positioned with safe plays in REITs and Utilities, several value stocks that have regained momentum, and 5G- and marijuana-related positions.

Monthly Issue December 18: In this issue, Tom highlights an outlier in the marijuana industry, Innovative Industrial Properties (IIPR). The company is actually a Real Estate Investment Trust (REIT) that takes much less risk than most of the other sector stocks and benefits from the simple fact that more marijuana will continue to be grown in the years ahead. The company is already making money and earnings continue to grow at a rapid clip. Also, the Invesco BulletShares 2019 Corporate Bond ETF (BSCJ) has matured. The final day of trading was on Monday, December 16

Cabot Marijuana Investor

Monthly Issue December 26: Generally, pruning losers and weak stocks and replacing them with strong stocks is the recipe for success. Tim added two new stocks to the portfolio last week, and if you feel underinvested in cannabis stocks, you can add any of the stocks that look attractive. But the portfolio still has 25% in cash, waiting until the sector strengthens, and he expects that to be soon!

Update December 19: Because the portfolio’s cash position is now 43% and Tim believes that’s too high as we enter the new year, he’s adding two new stocks to the portfolio and averaging up in others. He’ll initiate new 4% positions in GrowGeneration (GRWG) and Planet 13 (PLNHF); both stocks are rather lightly traded, so be careful and take your time. He’ll put an additional 4% in both Canopy Growth (CGC) and Cresco Labs (CRLBF). And he’ll put an additional 2% in Trulieve, which went through the wringer on Tuesday.

Cabot Early Opportunities

Monthly Issue December 18: In this month’s Issue of Cabot Early Opportunities Tyler takes a closer look at recent recommendations and evaluates their Q3 earnings reports. He also shows why he thinks the Small cap index is going higher in the near term. And he features five early-stage growth stocks going after totally different markets that look poised to deliver big gains in 2020 and beyond. His top pick this month is LeMaitre Vascular (LMAT), a Massachusetts-based medical device company with a market cap of $710 million.

Bonus Report:

3 Cloud Software Stocks to Buy Now

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

Position Update January 3: In light of last night’s events in the Middle East, and this morning’s market declines, Jacob wanted to update where we stand with our Cabot Profit Booster positions. The good news, despite today’s wobbles, is that all are working very well!

Frequently Asked Questions Report:

Frequently Asked Questions

Weekly Issue December 31: The Stock – Floor & Décor (FND) Floor & Décor has always had a great story—the company looks like one of the best cookie-cutter stories in construction-related retail, operating large (75,000 square feet on average) warehouse-style locations that specialize in hard flooring (tile, wood, stone, laminate and the like).

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

Top Picks Daily Alert January 3: VanEck Vectors Gold Miners ETF (GDX) The Personal Capitalist
Top Picks Daily Alert January 2: Franco-Nevada Corporation (FNV) Adrian Day’s Global Analyst
Top Picks Daily Alert December 31: Chart Industries, Inc. (GTLS) Cabot Undervalued Stocks Advisor
Top Picks Daily Alert December 30: Walgreens Boots Alliance, Inc. (WBA) Sure Dividend Newsletter

Monthly Issue December 18: We’ve had a decent month in the markets—despite all the impeachment hoopla. It looks like the China trade issue is improving, housing starts and building permits are healthy, and unemployment remains low. Sounds like the making of a great holiday season! Nancy begins this issue with her Spotlight Stock, General Dynamics Corporation (GD), a company that has been in business for 67 years, residing in the defense and aerospace sectors. As as she notes in her Feature article, both of those arenas are experiencing fantastic growth, which bodes well for GD.

Ask the Experts

Cabot Options Trader

Question: I hope you had a good weekend and happy new year to you. As always, I love the market commentary and the positions have done great this year.On this week’s Cabot weekly review, Mike mentioned IBB, Coup, and Plan as potentially having a good few months into 2020 based on current chart patterns. Do you see anything in the options side that may give some great profits?

Jacob: Thanks for the nice email and hope you also have a Happy New Year! As for your question, coincidentally I wrote up PLAN in this mornings Monday Weekly Update. Look for that in the next couple hours. If I was looking to play those three stocks I might look at ...PLAN March 55 calls for $4.20 or May 55 Calls for $5.30. IBB March 123 for $4.20 or June 125 for $5.70. COUP March 155 for $12 or June 155 $18.50 (these are some expensive options, but the stock does move violently) As you can see all of these call buys are a couple months out in time and slightly out of the money.

Cabot Undervalued Stocks Advisor

Question: What do you think of Sanderson Farms (SAFM), in light of China trade?

Crista:Yes, now that China has removed their long-standing ban on U.S. poultry imports, Sanderson Farms stands to benefit. I think the stock looks fantastic. Huge earnings growth, decent P/E, very low debt; price chart shows the stock just now breaking past a two-year high, so that’s bullish. Go for it.

Cabot Dividend Investor

Question: I have a question for you that my help me out. I have a grandson who just turned 21 a few months ago and I want him to start investing and saving for the future. I told him if he would open a account with TD Ameritrade I would fund his first stock purchase being he doesn’t have any money in is savings. Can you suggest some dividend stocks that would be for someone just starting out and that he could have the dividends reinvested for the long term.

Tom: For his first and only investment you might consider a market index ETF like SPY, or the Dividend Aristocrats ETF NOBL. That way he could get diversification. But I like individual stocks too, as long as he is prepared for a potential rockier ride. Some good ones include ABBV, MCD, CVX, INTC or CAT. There are more but I like all of these for the long term. Hope this helps. You have a happy New Year too!

Premium Reports

Cabot’s 10 Best Stocks to Buy and Hold for 2020.

Special Report

Once again, Crista has created a diversified portfolio of growth stocks with strong fundamentals to help you achieve your 2020 investment goals through capital gains and dividends. The Top 10 list from 2019 performed well, with a total return over 20% through mid-December.

Cabot’s 10 Favorite Low-Priced Stocks for 2020

Special Report

This year’s Low Priced Stocks Report, which as it usually does, features a mix of names (some beaten-down, some recently strong) that have great potential to stage at least a short-term bounce in the weeks ahead—if not much more down the road.

Quarterly Cabot Analyst Meeting

The recording of the quarterly Cabot Analyst Meeting from October 23, 2019 is now available for you to listen to at your convenience—click here for access. This quarterly 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
ABBVBuy
ACBSee Advisory
ADBEBuy
ALXNStrong Buy
AMZNStrong Buy
ANFBuy
APHASee Advisory
APPFBuy
APPSHold
AREHoldHold
ARNABuy
AVGOStrong Buy
AVLRBuy
BABABuy
BANDHold
BIPHoldHold
BKRBuy
BLDHold
BSCJBuy 1/2
BSCLBuy 1/2
BXHold
CBuyBuy
CCIBuy
CDLXHold
CGCSee Advisory
CHCTHold 1/3
CRAKStrong Buy
CRLBFSee Advisory
CRONSee Advisory
CTVASellHold
CURLFSee Advisory
CZZBuy 1/2
DAVABuy
DBIHoldHold
DBSDYBuy 1/2
DISBuy
DOCUBuy
DOMOHold
DOWBuy
DXCMBuy
EPDBuyBuy
EQHStrong Buy
EVBGBuy
EVERHold
FCXBuy 1/2
GESStrong Buy
GMBuy
GRWGSee Advisory
GSHDBuy
GTBIFSee Advisory
HCATHold
HTHTHold
IBNSold
IIPRSee AdvisoryBuy
INSPBuy
IPHIBuyBuy
LGIHStrong Buy
LKBuy 1/2Buy
MCYBuy
MEDIFSee Advisory
MOBuy
MOSHold
MPCStrong Buy
MRVLBuy 1/2
NEEHoldHold 1/2
NVCRBuy 1/2
OGISee Advisory
OKTAHold
PDDHold
PGXBuy 1/2
PLNHFSee Advisory
PWRStrong Buy
QCOMBuy
QTRXHold 1/2
QRVOBuyBuy
QTWOBuy
RGENBuy
RIOBuy
RKUNYBuy 1/2
RNGHold
ROADHold
RPDBuy
SEBuy 1/2Buy 1/2
SLBBuy
SNAPHold
SPCEBuy a HalfBuy
SSOBuy
STAGHold
TCNNFSee AdvisoryHold
TDOCBuy
TOTBuy
TPBSee Advisory
TSLAHold
TSNStrong Buy
TVSell
UEICBuy
VCYTBuy
VLOBuy
VOYAStrong Buy
VRTXBuy
XELHold 2/3