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Weekly Summary June 5, 2020

Cabot Prime Pro Week Ending June 5, 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, In this week’s video, Mike Cintolo dives into the market’s sharp rotation of the past two weeks—the good news is that broad market strength bodes very well for the months ahead for the overall market, but strong growth stocks have hit some potholes. Overall, he’s keeping his eyes open, but the evidence for the overall market is great and there’s been little in the way of abnormal action among leading growth titles, so he’s sticking to his bullish stance.

CABOT EVENTS:

Cabot Micro-Cap Insider

WEBINAR FOR PRIME PRO MEMBERS ONLY: Thursday, June 11, By Rich Howe, Chief Analyst of Cabot Micro-Cap Insider
Sign up now for FREE.
The American Income Crisis + 2 High-Yield Stocks to Buy

WEBINAR: Tuesday, June 16, By Tom Hutchinson, Chief Analyst of Cabot Dividend Investor
Sign up now for FREE.
Cabot Retirement Club

WEBINAR FOR PRIME MEMBERS ONLY: Thursday, June 25, By Tom Hutchinson, Chief Analyst of Cabot Income Advisor
Sign up now for FREE.

Advisory Services

Cabot Growth Investor

Bi-weekly Issue June 4: Remain bullish. In the Model Portfolio, the buy signal from the 90% Blastoff Indicator last week prompted Mike to buy a stake in the ProShares Ultra S&P 500 Fund (SSO), giving us direct exposure to the overall market. And in tonight’s issue, he’ll fill out our position in Cloudflare (NET), adding another half-sized position, which will leave us with around 18% in cash.

Bi-weekly Update May 28: Remain optimistic. Growth stocks have had a tough week, but the selling hasn’t been abnormal, few (if any) have broken down and today’s stabilization for many is a good sign. Moreover, the 90% Blastoff Indicator has turned green, which is a bullish sign for the overall market. Because of that, Mike is adding a full position in the ProShares Ultra S&P 500 (SSO) Fund tonight, which will leave us with around 24% in cash.

Other Stocks of Interest May 8: Follow ups to stocks featured December 19, 2019 (issue 1435) to May 7, 2020 (issue 1445). 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 5: From a top-down perspective, the market’s intermediate-term uptrend remains in great shape; every index is at least a few percent above its 50-day line. And what’s even more encouraging is that this week saw another major long-term measure turn green—on Wednesday, the 2-to-1 Blastoff Indicator gave a buy signal, and like the 90% signal, it bodes very well for the major indexes over the next few months. Mike’s buy ideas today are: Ciena (CIEN) and Immunomedics (IMMU). Today’s sell recommendations are: Acadia Pharmaceuticals (ACAD), Freshpet (FRPT) and Newmont (NEM).

Weekly Issue June 1: From a big-picture perspective, the 90% Blastoff signal last week (90% of NYSE stocks above their 50-day lines) bodes well for the overall market, and the fact that few (if any) leading stocks have cracked is a good sign. All in all, further potholes, rotations and shakeouts are relatively likely given the big run over the past two months and the divergent environment, but until proven otherwise, Mike continues to think the path of least resistance is pointed up. He’s moving our Market Monitor up another notch to a level 8. This week’s list has a good mix of setups, with some recent earnings winners, some that have pulled back and others that are in persistent uptrends. Mike’s Top Pick is Arconic (ARNC), which is one of the few cyclical stocks to appear in Top Ten since the uptrend got underway.

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 June 5: The Financials ETF (XLF) is trading higher by 4% today at 26.3. Today’s strength, after several weeks of gains, has helped push our XLF January 23 calls to a potential profit of 110%. Because of this impressive stock action, as well as bullish option activity in the components of the XLF, Jacob is going to continue to hold the position for greater upside.

Cabot Options Trader Pro Alert June 5: Adjust Existing Position: Against your Financials ETF (XLF) January 23 Calls, Sell the July 28 Call (exp. 7/17) for $0.40 or more.

Cabot Options Trader Basic and Pro Alert June 4: Covered Call: Buy Glu Mobile (GLUU) Stock and Sell the July 10 Calls (exp. 7/17) for a net price of $9 or less.

Cabot Options Trader Position Update June 3: In early trade today the Financials ETF (XLF) is trading higher by 2.25% at 24.5. This has pushed our January 23 Calls to a potential profit of approximately 50%. Jacob is going to continue to hold his position as there is the potential (though no guarantee) that this sector which has grossly underperformed hotter sectors could be due to play catch-up.

Cabot Options Trader Basic and Pro Alert June 2: Close Existing Position: Sell your DraftKings (DKNG) Stock and Buy back the June 30 Calls.

Cabot Options Trader Pro Alert June 2: Close Existing Position: Sell your JD.com (JD) June 39/47 Bull Call Spread for $7.50 or more.

Cabot Options Trader Basic and Pro Alert June 1: Sell HALF of Existing Position: Sell HALF of your Peloton (PTON) October 45 Calls for $7.80 or more.

Cabot Options Trader Pro Weekly Update June 1: Jacob has seven Long positions: DKNG, JD, GILD, ON, PTON, SNAP and XLF, one position not impacting his decision making: QQQ July Bear Call Spread and one short position: QQQ December Puts

Cabot Options Trader Weekly Update June 1: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week virtually unchanged at 27.5. While there has been a lot to write about in terms of the VIX for the past several months, Jacob has little to add this week as the VIX remains stuck in the 25-30 range. While the VIX has quieted down, interestingly his option activity spiked bullish as both Wednesday and Thursday his barometer recorded a 6, and he was very close to “scoring” both of those days 7 (pretty bullish).

Cabot Undervalued Stocks Advisor

Monthly Issue June 3: Three of today’s featured companies seem most obviously ready to begin or continue run-ups in the coming days: Equitable Holdings (EQH), Mercury General Group (MCY) and Tyson Foods (TSN). The fourth featured company, Bristol-Myers Squibb (BMY), is sitting at the bottom of a steady trading range, offering attractive opportunities for growth investors, dividend investors and traders. Here are Crista’s portfolio changes: Dow Inc. (DOW) moves from Buy to Strong Buy and Quanta Services (PWR) moves from Hold to Buy.

Weekly Update May 27: The S&P 500 Index and the Dow Jones Industrial Average began new run-ups yesterday, while the NASDAQ Composite Index continues its uptrend. Crista is glad that investors are continuing to make money during this market rebound. Many stocks that are currently rising will cease rising once they retrace their February 2020 highs. They will need to rest and/or pull back, depending on the stock and activity in the broader market. Here are today’s portfolio changes: LGI Homes (LGIH) moves from Hold to Sell, Mercury General Group (MCY) moves from Hold to Buy and Universal Electronics (UEIC) moves from Buy to Strong Buy.

Cabot Stock of the Week

Weekly Issue June 1: The overall market remains healthy, and while we still haven’t received an “all-clear” signal from our long-term timing indicator, we do have a positive signal from the 90% Blastoff Indicator, and that’s good! Overall, our portfolio stocks are behaving quite well, with none disappointing today. In fact, many are so strong that Tim expects pullbacks in the future. As for today’s recommendation, Chegg (CHGG), it’s a company in the online education industry, where demand is booming thanks to COVID-19. Tim has one change today: Fanuc (FANUY) moves from Buy to Sell for a quick profit of 30%.

Cabot Global Stocks Explorer

Bi-weekly Update June 4: Today Carl writes about why he believes that Southeast Asia deserves more attention from both a strategic and investment point of view. Our Explorer portfolio has two direct Southeast Asia plays, DBS Bank (DBSDY) and Sea Limited (SE), which was founded by Singapore-based ethnic-Chinese entrepreneurs and backed by Tencent. In this age of U.S.-China rivalry, Southeast Asia will be a key part of the chessboard. Carl has one portfolio change today: Virgin Galactic (SPCE) moves from Buy a Half to Buy a Full Position.

Bi-weekly Issue May 28: Cabot Global Stocks Explorer positions did well this week, led again by a surging Sea Limited (SE) and after rebound of interest in Virgin Galactic (SPCE) pushed its shares up 16%. Trip.com (TCOM) was up 7.3% yesterday in anticipation of earnings, which are expected after the close today. Carl has no portfolio changes today.

Cabot Small-Cap Confidential

Monthly Issue June 4: This month, Tyler is breaking into a familiar market by going back to the insurance industry. But today’s addition is very different from our other rapid growth insurance companies in a major way. The stock, Palomar Holdings (PLMR), is acting strong and the fundamentals remain great, despite COVID-19.

Weekly Update May 28: In the immediate future Tyler is spending a lot of time evaluating our stocks in the context of all the other stocks he monitors for future inclusion, as well as those he considers trusty bellwethers of strength/weakness in their respective markets. All of this will be factored into his new stock for next week. Big picture, he doesn’t think enough has changed to alter our strategy so there are no ratings changes this week.

Cabot Dividend Investor

Weekly Update June 3: Consider that if the market trends higher from here and does not move down significantly, we are in a new bull market. Bull markets typically last for many years and, historically, the first few months only represent about 10% of the move higher in bull market. And that just speaks for the overall market. There are still many stocks that are still wallowing in bear market territory, down 20% or 30% or more. For now, enjoy the rally. And Tom will keep you posted. There are no rating changes today.

Monthly Issue May 13: Cabot Dividend Investor portfolio is only buying very selectively. While the overall market may be shaky at this point, certain companies are thriving during the pandemic. There are niches where business is actually booming. In this issue Tom highlights two stocks that are selling at bargain prices, have businesses barely affected by the pandemic, and stand to thrive in the post-Covid-19 market as well. He has one portfolio change today, Innovative Industrial Properties (IIPR) moves from HOLD to BUY.

Cabot Marijuana Investor

Monthly Issue May 27: Own the leaders. Sell the losers. And remember that someday, when marijuana is declared legal across the U.S., the institutions will come running. You who are here now, are early. The portfolio averaged up in four of our stocks two weeks ago and is now down to 13% in cash, and that’s where Tim will keep it, waiting for a fresh buying opportunity.

Special Report: April 29, 2020

U.S. Vertically Integrated Multistate Operators (MSOs)

Cabot Early Opportunities

Special Bulletin June 5: Tyler updates six stocks today: Smartsheet (SMAR), Viela Bio (VIE), Virgin Galactic (SPCE), DraftKings (DKNG), Kroger (KR) and Enphase (ENPH) and makes several rating changes.

Monthly Issue May 20: In this month’s Issue of Cabot Early Opportunities, Tyler sifts through all his ideas to feature a compelling mix of five stocks that still look to have significant upside potential over the coming months. Several of these names should represent new ways for investors to participate in long-term growth trends. The month’s Top Pick, Formula One Group (FWONK). If you want to invest 100% in Formula 1 (along with a smattering of other minority interests, including the Braves MLB team, Drone Racing League and Tastemade), now you can.

Cabot Profit Booster

Weekly Issue June 2: The Stock – Pan American Silver (PAAS) Precious metal stocks have become mixed of late as economic optimism has increased, but some are still strong, and Pan American Silver is one of them. Despite the name, the company’s purchase of Tahoe Resources in early 2019 has made it a diversified play—the company is one of the largest silver plays out there, but it’s actually doing more business in gold these days simply because gold prices have trended up over time while some silver mines have shuttered. The Covered Call Trade Buy Pan American Silver (PAAS) Stock at 30.25, Sell to Open July 31 Calls (exp. 7/17/2020) for $1.75, or a Net Price of 28.5 or less.

Cabot Micro-Cap Insider

Weekly Update June 3: The market continues to rally despite a global recession, surging unemployment and now riots across the country. As legendary 1900s trader Jesse Livermore would put it, “The path of least resistance is up. Don’t fight the tape.” Nonetheless, Rich is cautious and believes this bear market rally is getting a bit long in the tooth. He has no portfolio changes today.

Monthly Issue May 13: If you have not already, Rich recommends that you read his Cabot Micro-Cap Insider Guide. It will help you get the most out of your Cabot Micro-Cap Insider membership, and make your investing decisions easier and more profitable. It will also explain much of the shorthand we use in Cabot Micro-Cap Insider, and explain our ratings. His newest recommendation is: Medexus Pharmaceuticals (MDP.V), a Canadian specialty pharma company that is growing at a rapid clip.

Special Report

A Defensive Healthcare Stock with 100% Upside

Special Report

The Best Way to Play the Oil Market Dislocation

Cabot Income Advisor

Special Bulletin June 3: Covered Call: Sell IIPR July 17 $95 call at $3 or higher - Expiration date: July 17 - Strike price: $95 - Call price: $3 or higher

Monthly Issue May 25: Welcome to the very first issue of Cabot Income Advisor. The purpose of this newsletter is to provide you with investment ideas that generate a very high level of current income. The goal is to provide you with a double digit annual income with a reasonable level of risk, whereby you can maintain and grow your nest egg over time. Chief Analyst, Tom Hutchinson has found three strong investments that he is recommending as a BUY in this inaugural issue. I foresee this portfolio eventually having 10 to 15 different investments. Whatever you may want to allocate to this newsletter portfolio should be spread over 10 or more stocks. We will start with three. You don’t have to invest all at one time.

Special Report:

Off the Radar Cash Generators

Special Report:

The Covered Call Income Machine

Wall Street’s Best Investments

Daily Alert June 5: Sprouts Farmers Market, Inc. (SFM) FMA Trader Alert
Daily Alert June 4: Baidu, Inc. (BIDU) Contrarian Outlook
Daily Alert June 3: Sell: Fidelity International Small Cap Fund (FISMX) Fidelity Monitor & Insight
Daily Alert June 3: Fidelity International Capital Appreciation Fund (FIVFX) Fidelity Monitor & Insight
Daily Alert June 2: Cloudflare, Inc. (NET) Cabot Global Stocks Explorer
Daily Alert June 1: Calavo Growers, Inc. (CVGW) Sure Dividend

Monthly Issue May 21: Nancy’s Spotlight Stock this month, Curaleaf Holdings, Inc. (CURLF), is also one of the few marijuana stocks that sports a strong balance sheet. It has roughly $42 million worth of cash on its balance sheet and nearly $150 million when you count current assets and cash equivalents. It has the financial heft to survive this crisis. And her Feature article delves further into the pot industry.

Ask the Experts

Cabot Undervalued Stocks Advisor

Question: How do I know when a company is about to cut it’s dividend?

Crista: This year has been very different; requiring more attention to dividends that any rule-of-thumb that I formerly used.In the past, by sticking with companies that had growing profits and low debt levels, that served as a 95% guarantee that the dividend was safe. Then COVID-19 came along, and businesses were halted from operating. Formerly healthy companies had their earnings outlooks change rapidly. They began cutting dividends right and left in order to preserve capital and keep the companies up-and-running.My suggestion is to look at a company’s earnings per share (EPS) projections once per month, and keep notes. If the earnings outlook deteriorates, then pay close attention: use a stop loss or read research from major firms (such as Morgan Stanley) that surely discusses whether the dividend is safe or not.

Quarterly Cabot Analyst Meeting

The recording of the Cabot Prime Members Meeting with the Analysts from April 15, 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.

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
ABBVHoldBuy
ADBEHold
ALXNHold
AMZNBuy
APHASee Advisory
APPFHold
AREHold
ARNABuy
AVGOBuy
AVLRBuy
BABAWatch
BIPBuy 2/3
BKRHold
BMYStrong Buy
BSCLBuy 1/2
BUGBuy 1/2
CCIHold
CDLXBuy
CGCSee Advisory
CHCTHold 1/3
CHGGBuy 1/2Buy
CHWYHold 1/2
CRAKStrong Buy
CRLBFSee Advisory
CRONSee Advisory
CURLFSee Advisory
DBSDYBuy 1/2
DOCUHold 3/4
DOMOSold
DOWStrong Buy
DXCMHold 3/4
EPDHold
EQHStrong Buy
EVBGHold
EVERHold 1/2
FANUYBuy 1/2Sell
FVRRHold 3/4
GFLBuy 1/2Buy
GILDBuy 1/2
GMStrong Buy
GOLDBuy
GRWGSee Advisory
GSHDHold 3/4
GTBIFSee Advisory
HTHTHold
IIPRSee AdvisoryBuy
INSPHold
KPTIBuy
LGIHSold
MCYBuy
MKSIStrong Buy
MOHold
MPCBuyStrong Buy
NEEHoldHold 1/2
NETBuy 1/2Buy another 1/2
NFLXBuy
NVDAHoldHold
NVEEStrong Buy
OKTABuy
PGXHold 1/2
PLMRBuy 1/2
PWRBuy
QCOMHold
QTWOBuy
RGENHold
RNGHold
SEHold 1/2Hold
SPCEBuy another 1/2
Buy
SSOBuy
STAGHold
TCNNFSee AdvisoryBuy
TCOMBuy 1/2
TDOCHold
TLRYBuy
TOTStrong Buy
TPBSee Advisory
TSLAHold
TSNBuyStrong Buy
TWLOBuy
UEICStrong Buy
VLOHold
VOYAStrong Buy
VRTXBuyBuy
VZBuyBuy
XELHold 2/3
ZMHold
ZSHold