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Weekly Summary June 28, 2019

Cabot Prime Pro Week Ending June 28, 2019

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 sees a still-healthy (though not robust) overall market, but some bifurcation among growth stocks—some names that have had huge runs are flashing some yellow lights, while many “fresher” names are acting peppy. Mike reviews all his indicators and some of his favorite setups as we head into the second half of 2019.

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Advisory Services

Cabot Growth Investor

Bi-weekly Update June 27: Mike says to lean bullish. The market’s evidence remains mostly positive, though the action of growth stocks over the past two weeks has been less than stellar. Overall, he’s taking things on a stock-by-stock basis, selling names that act abnormally but are willing to put money to work in stocks that look like “fresher” leaders.There’s one change in the portfolio today: Mike is going to fill out the position in Coupa Software (COUP), adding another half-sized position. Our cash position will now be around 28%.

Special Bulletin June 25: In the Model Portfolio, two of our retail stocks are looking ragged. The first is Planet Fitness (PLNT), which lost some momentum over the past month. Mike is going to sell half the shares here and hold the rest with a mental stop in the mid- to upper-60s. The other stock that’s under pressure is Five Below (FIVE), which showed some life after a shakeout earlier this month, but now it’s back in the soup—today, in fact, it closed below its long-term 200-day line. Tonight, he’s going to sell the remaining shares and book the rest of our long-term profit. These two moves will leave us with around 33% in cash in the Model Portfolio.

Bi-weekly Issue June 20: Mike says to put some more money to work. Our Cabot Tides turned positive yesterday, and on a special bulletin this morning, he added a full position in Blackstone (BX) and a half position in Zillow (Z), which has left us with around 23% in cash. He’s also restoring the buy rating on Twilio and ProShares Ultra S&P 500.

Other Stocks of Interest June 20: Follow ups to stocks featured January 17, 2019 (issue 1411) to June 20, 2019 (issue 1422). 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 June 28: The major indexes had a relatively quiet week ahead of the G20 summit, which is (mostly) taking place over the weekend. As Mike writes this, the S&P 500 and Nasdaq are down about 0.7% on the week, which is more than reasonable given the recent gains. In his mind, this makes it four straight constructive weeks following the market low. But from a top-down perspective, most of the evidence (intermediate- and longer-term trends pointed up) is positive, so he continues to lean bullish. Mike’s buy ideas this week are: First Solar (FSLR) and Smartsheet (SMAR). There are five outright sells this week, Ascendis Pharma (ASND), Five Below (FIVE), GW Pharmaceuticals (GWPH), LPL Financial (LPLA) and Zoom Communications (ZM).

Weekly Issue June 24: Combined with a bullish longer-term trend and many indicators that suggest investors remain hesitant, the path of least resistance for stocks remains up. That said, the market rarely makes it easy, and on that note, Mike has seen a fair amount of rotation in recent days out of some of the strong (and in many cases, extended) growth stocks and into other areas of the market. Overall, he remains bullish, but you should take things on a stock-by-stock basis—if you own something at a good profit, consider booking partial profits and trailing a stop for the rest, while honoring loss limits on any recent purchases. This week’s list contains all types, but includes a few fresher-looking charts. Mike’s Top Pick this week is Iqvia (IQV), a steady, reliable medical play that just blasted off from a good-looking rest period.

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 Alert June 28: Adjust Existing Position: Against Regions Financial (RF) stock position sell the August 16 Calls (exp. 8/19/2019) for $0.17 or more.

Cabot Options Trader Stocks on Watch June 27: This weekend, President Trump and Chinese President Xi will finally meet at the G-20 summit. The “results” from this long awaited meeting could potentially move the market violently Monday. In fact, the options market is pricing in a move of 1.37% in the S&P 500 by Monday. Jacob doesn’t anticipate adding a new position ahead of what feels like a binary event. However, if you are looking to add positions he gives you some intriguing trades made yesterday and today.

Cabot Options Trader Alert June 26: Buy-Write: Buy Snap (SNAP) stock and Sell the July 14.5 Call (exp. 7/19/2019) for a net price of $13.97 or less.

Cabot Options Trader Stock on Watch June 25: Jacob says there is strength in the med-tech sector, which has been quietly very strong for quite some time. And into this sector strength, traders have been aggressively buying calls, including in Medtronic (MDT), which brought us into a position last week, as well as in Boston Scientific (BSX) and Abbott Laboratories (ABT).

Cabot Options Trader Pro Weekly Update June 24: Jacob has nine long positions: DIS, GLW, JD, LVS, MDT, MSFT, RF, SE and Z.

Cabot Options Trader Market Update June 24: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week virtually unchanged at 15.40. Jacob was again surprised at how calm the VIX was this last week as tensions between the U.S. and Iran flared up, and ahead of this week’s G-20 summit. The way he would interpret this calm in the VIX is traders are already hedged, or they don’t anticipate any fireworks from these known geopolitical concerns.

Cabot Undervalued Stocks Advisor

Weekly Update June 25: Crista writes that the June 21 Dodd-Frank Act stress test (DFAST) results conclude that all U.S. banks passed this year’s bank stress tests conducted by the Federal Reserve. In total, results were significantly stronger than last year’s results. Banks that are heavily into the credit card business, such as Capital One (COF), did not fare nearly as well as the other banks that the Fed reviewed. Crista has three portfolio changes today: Knight-Swift Transportation (KNX) moves from Hold to Retired, Mosaic Company (MOS) moves from Hold to Buy and Southwest Airlines (LUV) moves from Hold to Buy.

Monthly Issue June 4: This week Crista points out that the stock market recently rose a ridiculously large amount in a very short amount of time and that it cannot continue rising until it pulls back and rests for a while. That process could normally take 2-6 months. (That’s a rough estimation.) We’re one month into the pullback, which means we’re one month closer to the eventual market rebound. She concludes that the stock market will eventually offer up new, lucrative opportunities. Here are today’s portfolio changes: CIT Group (CIT) moves from Strong Buy to Hold, Corteva Inc. (CTVA) spun off from DowDuPont (DWDP) and joined the S&P 500 index, DowDuPont (DWDP) changed its name to DuPont de neMours (DD), Guess? (GES) moves from Buy to Hold, Sanmina (SANM) moves from Strong Buy to Hold, Southwest Airlines (LUV) moves from Buy to Hold.

Cabot Stock of the Week

Weekly Issue June 25: The broad market sold off today, but odds are it’s just a normal pullback in the renewed bull market. Overall, our market-timing indicators tell us the trends are up. However, eternal vigilance is the price of success in investing, so today Tim is recommending selling two stocks that have recently broken down. As for today’s recommendation, it’s a company you probably know, Zillow (Z), the biggest player in the online real estate market, and impressive for the way it keeps reinventing itself (sort of like Netflix). There are four changes in the portfolio this week: AbbVie (ABBV) moves from Buy to Sell, Planet Fitness (PLNT) from Buy to Hold, Twilio (TWLO) from Hold to Buy and Zoom Video Communications (ZM) from Buy to Sell.

Cabot Emerging Markets Investor

Bi-weekly Issue June 27: The Emerging Markets Timer turned positive a couple of weeks ago and remains so today, a good sign despite the global uncertainties. The iShares EM Fund (EEM) bottomed in late May, accelerated higher last week and stands well above its lower (25-day), rising moving average. Thus, the intermediate-term trend is pointed up. In this week’s issue, Carl adds a small position in NIO (NIO); has an addition to the watch list with MakeMyTrip Limited (MMYT); is selling Daimler (DDAIF) and moves Alibaba (BABA) from Buy a Half to Buy a Full Position.

Bi-weekly Update June 20: Carl writes that emerging markets got a boost this week as it appears that there will be a high level meeting between the U.S. and China at the upcoming G-20 meeting. One of the biggest drivers of emerging markets closing the gap with more developed countries has been the combo of the internet and smartphones. He says this story still has legs. There are no portfolio changes this week.

Cabot Small-Cap Confidential

Weekly Update June 28: Not surprisingly, this week wasn’t a great one for our portfolio. Tyler had a feeling the party was winding down last week, when he had an average gain of 105% going and had just seen our stocks pop an average of 6% over five days. This past week, the stocks declined by an average of 3%, led down by Upland Software (UPLD), down 14%, Everbridge (EVBG), down 10%, and AppFolio (APPF), down 7%. Tyler has one portfolio change today, Rapid7 (RPD) moves from Hold to Buy.

Monthly Issue June 7: Today’s stock, EverQuote (EVER) runs an online marketplace that matches insurance buyers with sellers where over $120 billion is spent each year. It is a simple concept with big potential. Tyler also updates all the stocks in the portfolio and has one change today: Quanterix (QTRX) moves from Buy to Hold.

Cabot Dividend Investor

Monthly Issue June 26: In this issue, Tom highlights Valero Energy (VLO), a stock that is cheap in an expensive market that has a great chance of moving higher in the quarters ahead. There are two rating changes this week. Pharmaceutical company AbbVie (ABBV) is reduced from a BUY to a HOLD as the market digests its purchase of Allergan (AGN). Also, spice maker McCormick and Company (MKC) is lowered from a HOLD to SELL HALF ahead of tomorrow’s earnings announcement.

Special Bulletin June 26: Early Tuesday morning Biopharmaceutical giant AbbVie (ABBV) announced plans to acquire Ireland-based Allergan plc (AGN) for $63 billion. The market hates the deal and AbbVie stock plummeted over 16% on the day. Tom gives us his take on the deal. The stock rating will be changed from a “BUY” to a “HOLD” for now. He will reevaluate going forward as the market further digests the ramifications of what happened.

Weekly Update June 19: Tom still feels good about the market over the remainder of the year. The economy is still strong—he believes stronger than the current consensus opinion is suggesting. But the relatively high level of uncertainty combined with the lack of more Fed rate hikes will continue to favor the defensive oriented dividend stocks. There are no changes in the portfolio this week.

Cabot Marijuana Investor

Monthly Issue June 27: The cannabis sector is currently in a correction, with both marijuana and CBD stocks trending lower, giving up some of their early-year gains—and perhaps building a bottom here. In fact some of the biggest stocks, those supported best by institutional investors, are already looking stronger, though it will take time to know if they are in real uptrends. In the meantime, Tim continues to build cash, which will come in handy when it’s time to buy again. This week he’s selling portions of two more, HEXO (HEXO) and OrganiGram (OGI), raising the portfolio’s cash level to about 33%.

Update June 20: Tim will now make three changes to the portfolio, selling partial positions in Green Thumb Industries (GTBIF), Innovative Industrial Properties (IIPR) and KushCo Holdings (KSHB). These actions will raise our cash level to about 24%.

Wall Street’s Best Investments

Top Pick Update Daily Alert June 28: Ulta Beauty, Inc. (ULTA) from Hendershot Investments
Top Pick Update Daily Alert June 27: Twilio Inc. (TWLO) from Cabot Growth Investor
Daily Alert June 26: NVIDIA Corporation (NVDA) from Nate’s Notes
Daily Alert June 25: Pan American Silver Corp. (PAAS) from Internet Wealth Builder
Top Pick Update Daily Alert June 24: Midland Capital Holdings Corp. (MCPH) from Hughes Investment Management

Monthly Issue June 12: Nancy begins this issue with our Spotlight Stock, Pivotal Software, Inc (PVTL), which is becoming a top competitor in the platform as a service (PaaS) industry. The company was founded in 2013 to create a platform that would make it easier for developers to design and launch new programs and other platforms. You’ll find the details in her Feature article.

Wall Streets Best Dividend Stocks

Top Pick Update Daily Alert June 28: Innovative Industrial Properties, Inc. (IIPR) from Cabot Marijuana Investor
Top Pick Update Daily Alert June 27: Sabra Health Care REIT, Inc. (SBRA) from Equity Research & Portfolio Evaluation, Inc
Daily Alert June 26: Kontoor Brands, Inc. (KTB) from The Stock Spin-Off Investing Newsletter
Top Pick Update Daily Alert June 25: Algonquin Power & Utilities Corp. (AQN) from Global Investing
Top Pick Update Daily Alert June 24: Quarterhill Inc. (QTRH.TO) from Contra the Heard Investment

Monthly Issue June 5: Nancy’s Spotlight Stock, Gilead Sciences (GILD), is a major biopharmaceuticals producer focusing on life-threatening diseases. Founded in 1987 by Michael Riordan, a 29-year-old medical doctor, Gilead has grown to over $22 billion in revenues through both internal growth and by acquisitions. Her Feature article uses Gilead as an example of when to sell and when to buy and Nancy provides two lessons learned.

Ask the Experts

Cabot Undervalued Stocks Advisor

Question: What do you think of ZION’s outlook?

Crista: Earnings growth has finally slowed substantially at Zions Bancorp. After EPS growth of 44% and 43% in 2017 and 2018, the bank is now expected to see EPS grow 9.8% and 6.9% in 2019 and 2020. The dividend yield is 2.7% (typically announcing an increase in late July) and the 2020 P/E is 9.2. I consider the stock to be fairly valued. Zions is not one of the banks that’s part of the June 27 CCAR report from the Federal Reserve, so there will not likely be a specific near-term catalyst for share price growth. However, as the major bank stocks respond well to CCAR results, that could lift other banks and financial stocks. The stock has been languishing. ZION could easily rise to 47 during the next upturn in financial stocks, but I don’t expect any outsized share price appreciation unless something unusual happens, such as M&A activity.

Question: The entire Midwest has been inundated with rain & flooding this year. It is too late to plant corn, and nearly too late to plant soybeans. I have to believe this will significantly impact companies that produce agricultural chemicals.

Crista: U.S. weather/flooding concerns are affecting many industries this year, from apparel to trucking, and certainly everything farming-related. Every affected company and every analyst on Wall Street are figuring the effects of this devastating flooding into their financial projections. Fortunately, I’m currently invested in companies that supply agricultural chemicals all over the globe. These companies routinely experience boom & bust planting seasons each year, in different locations from China to Brazil to Canada. As long as the company is financially healthy and projected to continue growing profits, I’ll keep it on a long leash within my Cabot Undervalued Stocks Advisor portfolios. I know from experience that investors do not like to sell stocks, and as such my portfolios are not oriented toward short-term trading. And of course, people who are wary of the U.S. farming situation can simply choose not to invest in farming-related companies. If the prognoses for Mosaic, CF Industries and/or Corteva change, I will definitely change my recommendations accordingly. Please be assured that the poor U.S. planting season has already been calculated into revenue and profit projections at every company that I recommend. My heart goes out to the farming communities.

Cabot Marijuana Investor

Question: Your July 20 update is confusing. You say you are raising your cash to 24% but the spreadsheet shows 15%. Can you please help me understand?

Tim: Sorry for the confusion. The table reflects the status of the portfolio at the time of publication. The actions recommended are then executed after (using the average price over the remainder of that trading day) and then the table is adjusted to reflect those actions. Hope that helps.

Question: I’ve been following you and listening to all you do. I have a position in OGI. Should I add? Thanks for all

Tim: If you have a profit in OGI, not a loss, you can average up once the stock bottoms. However, if you have a loss, you should not buy more until you have a profit. Investors pursuing growth should never average down in losers; that’s rewarding bad behavior.

Premium Reports

Cabot’s 10 Best REIT’s to Buy Now

Special Report

May 2, 2019: REITs are a way for investors to have a diversified portfolio of real estate-related investments even if you don’t have millions of dollars, much like mutual funds did for stocks. And REITs are traded on the market, just like stocks. In this new, exclusive report, you’ll discover how to profit in REITs, even when interest rates are rising.

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
AAPLHoldStrong Buy
ABBVSellHold
ACBSee Advisory
ADBEBuy
ALXNBuy
ANFBuy
APHASee Advisory
APPFHold
ARNABuy
ARRYSold
AVLRBuy
AXPHold 1/2
AXSBuyStrong Buy
BABABuy
BHGEStrong Buy
BIPBuyBuy
BSCJBuy 1/2
BSCLBuy 1/2
BXBuyStrong Buy
CStrong Buy
CCIBuy
CDNAHold
CDXSBuy
CFStrong Buy
CGStrong Buy
CGCSee Advisory
CHCTHold
CITHoldStrong Buy
CMCHold
CMGBuy
COUPBuy
CRLBFSee Advisory
CRONSee Advisory
CURLFSee Advisory
CVTAHold
DALBuyStrong Buy
DBIBuy
DDHold
DDAIFSell
DOMOHold
DOWStrong Buy
EDHold 2/3
ELLXFSee Advisory
EPDBuy
EVBGHoldHold
EVERBuy
EXASHold
FIVESell
GESHold
GSHDBuy
GTBIFSee Advisory
HEXOSee Advisory
HTHTHold
IBNBuy 1/2
IIPRSee Advisory
KNXRetired
KSHBSee Advisory
LGORFBuy 1/2
LKBuyBuy
LUVBuy
LXBuy
MKCSell 1/2
MOBuy
MOSBuy
MPCBuy
MTCHBuy
NEEHoldHold
NIOBuy a Small Position
OGISee Advisory
OKTABuy
PGXBuy 1/2
PLNTSell 1/2Hold
QTRXHold
QTWOBuy
RCLHold
REMXBuy 1/2
RGENBuy
RPDBuy
SANMHold
SEHold 1/2
SLBBuy
SNAPBuy
SSOBuy
STAGHoldHold
SUPNHold
SYFStrong Buy
TCEHYBuy 1/2
TIVOHold
TOTBuy
TPBSee Advisory
TSLAHold
TTDHold
TWLOBuyBuy
UEICStrong Buy
UPLDBuy
VFFSee Advisory
VLOBuy
VOYABuyStrong Buy
XELHold 2/3
ZBuy 1/2Buy
ZMSell
ZTOBuy 1/2