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Weekly Summary March 6, 2020

Cabot Prime Pro Week Ending March 6, 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, Mike Cintolo is staying cautious and patient as the market is having trouble getting off its knees. That said, the “good” news about this decline (including Friday’s mini-retest of the week-ago lows) is that it makes it easier to see which stocks are holding up best, and Mike dives into many names (and a couple of sectors) worth watching—or, if you’re aggressive, nibbling on.

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Advisory Services

Cabot Growth Investor

Bi-weekly Update March 5: Remain cautious. The market has been gyrating wildly this week, holding above its lows from last Friday. That said, our Cabot Tides are negative and the sellers are in control of most stocks, so Mike is holding plenty of cash and waiting patiently for the next sustained uptrend. In the Model Portfolio, he has one very unusual change tonight—he’s going to “sell/drop coverage” of Sea Ltd. (SE), not because of performance (the stock looks great), but because of a publishing error in last week’s issue. All in all, the Portfolio will now have around 53% in cash.

Bi-weekly Issue February 27: Raise some cash and cut back on new buying. Mike came into this week with 17% cash in the Model Portfolio, and since then he’s quickly pared back, selling all of Inphi (IPHI) and portions of both Sea (SE) and Vertex (VRTX). That’s boosted his cash total to around 36%, while he has tight leashes on a couple other positions.

Other Stocks of Interest February 28: Follow ups to stocks featured October 10, 2019 (issue 1430) to February 27, 2020 (issue 1440). 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 March 6: The “good” news about a market wipeout like this, including today’s retest of last week’s lows is that it makes it easy to spot which stocks are holding up the best—these are the names that should be near the top of your shopping list or, for those willing, to do a little nibbling. Mike is not advising specific buys as just about every stock is moving wildly, but here are a few that have caught his eye due to some relative strength and/or resilient patterns: Atlassian (TEAM), Acceleron Pharma (XLRN), Franco-Nevada (FNV), GDS Holdings (GDS), iRhythm (IRTC), SolarEdge (SEDG), Teladoc (TDOC) and Zoom Video (ZM). There are four sells today: Envestment (ENV), Thor Industries (THO), SurveyMonkey (SVMK) and Zillow (Z).

Weekly Issue March 2: Following last week’s rolling crash in the market, everyone is wondering what comes next, but instead of predicting (guessing), it’s better to stick with the facts. Here’s where the evidence stands: The intermediate-term trend is clearly down for all major indexes and most (though not all) stocks, and given that this comes after a prolonged advance, some time is likely going to be needed to repair the damage. Short-term, though, we did see some legitimate extremes in a few key measures that says today’s bounce could go further. All together, it’s best to be in a cautious stance, though you shouldn’t panic out of everything—holding on to your resilient winners is fine, and if you have plenty of cash, a little buying is fine as well. Mike’s Top Pick is Regeneron Pharmaceuticals (REGN), which has a good overall story and what could be a big catalyst, too.

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 March 6: It’s easy to find bad news these days, so you don’t need Jacob’s help with that. But one ray of light that’s worth noting is that some stocks are holding well, and our own portfolio has a couple of bright spots. One stock that has been performing excellently is JD.com (JD). As of 11:15 Eastern time the stock is trading just short of its high at 42.75. This has pushed our Cabot Options Trader position to a potential profit of 85%, and Cabot Options Trader Pro’s position to a potential profit of 60% (and continuing to move closer to our dream spot and much greater profits).

Cabot Options Trader Basic and Pro Alert March 5: Sell Existing Positions: Sell HALF of your XOM September 62.5 Calls for $0.60 or more and Close Pinterest (PINS) Covered Call.

Cabot Options Pro Trader Alert March 4: Adjust Existing Position: Against your Taiwan Semiconductor (TSM) April 55 Calls, Sell the April 60 Calls for $0.90 or more.

Cabot Options Trader Market Update March 3: In early trading today these stocks are somewhere between unchanged and down 4% on the day. So in that respect, for now, it appears that this news was mostly priced in. As Jacob has said in the past, including yesterday, if he sees no edge in trading he’s not going to send trade alerts just to produce content. And this is a ZERO edge environment.

Cabot Options Trader Position Update March 2: JD.com (JD) reported earnings this morning that beat expectations. In reaction the stock is trading higher by 9% at 42, which impressively is just $1 short of its 52-week high at 43. Jacob is going to continue to hold both positions as JD looks like a potential stock star amidst the coronavirus mess.

Cabot Options Trader Pro Weekly Update March 2: Jacob has 7 Long positions: IBM, JD, MCHP, PINS, TSM, XOM and Z, 1 Short position: SPY and one position not impacting my decision making: SPY Iron Condor.

Cabot Options Trader Weekly Update March 2: The Chicago Board of Options Exchange Volatility Index (VIX) closed the week at 40, or higher by 135%. This was the largest weekly spike in the history of the Volatility Index, though that close at 40 on Friday was well off the day’s highs at 49.5.

Cabot Undervalued Stocks Advisor

Special Bulletin March 5: Today’s news: Abercrombie & Fitch (ANF) reported a fourth quarter earnings beat and Crista writes to newer investors about stock market corrections.

Monthly Issue March 4: Crista will continue to write Bulletins more often, so that investors can navigate through this stock market correction and take advantage of trading opportunities. She might frequently mention stocks that don’t appear in these portfolios. There are lots of excellent growth stocks to choose from, and she can’t write about all of them, each week, but she can present them to you for your consideration. In that light, she mentioned NVIDIA (NVDA) a few days ago, and today the stock joins the Special Situation and Movie Star Portfolio.

Special Bulletin March 2: Crista writes that she expects stocks to settle down and trade sideways for several months, with price charts that look like mountain ranges: up, down, up, down, up, down. Do not expect your stocks to go back to their early February highs in March. Stock market corrections have a pattern of falling rapidly and recovering slowly.

Weekly Update February 26: The COVID-19 problem, as it pertains to the U.S. stock markets, is compounded by the fact that the S&P 500 index had risen about 12% since October. That’s a very big move for a market index in a short period of time, and as such, the market was overdue for a price correction, regardless of the existence of COVID-19. The price correction has arrived. Typically, there will be days, early on during a price correction, in which the market rises and investors are enthused. Those days are then followed by more bearish days. The downturn might only last for a few weeks, followed by a period of sideways trading as the market gets its bearings. Please be assured that Crista will offer you attractive growth stocks and dividend stocks, as soon as the market calms down. Here are today’s portfolio changes: Abercrombie & Fitch (ANF) moves from Strong Buy to Hold, Baker Hughes (BKR) moves from Buy to Hold, Broadcom (AVGO) moves from Strong Buy to Hold, General Motors (GM) moves from Strong Buy to Hold, Guess?, Inc. (GES) moves from Strong Buy to Hold, Total SA (TOT) moves from Strong Buy to Hold, Tyson Foods (TSN) moves from Strong Buy to Hold, VanEck Vectors Oil Refiners ETF (CRAK) moves from Strong Buy to Hold and Voya Financial (VOYA) moves from Buy to Hold.

Cabot Stock of the Week

Weekly Issue March 2: The market needed a correction after zooming higher for nearly five consecutive months, and now we have one—a real doozy! But as every investor knows, market corrections provide buying opportunities, so Tim, for one, is happy that the format of this advisory not only allows but requires a new recommendation every week. The challenge, of course, is choosing what to buy when the market is falling apart—and Mike Cintolo has the answer in today’s featured stock, Seattle Genetics (SGEN), which was first recommended in Cabot Growth Investor. Tim has three portfolio changes today: Equitable Holdings (EQH) moves to SELL, Iphi (IPHI) to SELL and Trulieve (TCNNF) moves from BUY to HOLD.

Cabot Global Stocks Explorer

Bi-weekly Issue March 5: Today, Carl writes about the growth of financial technology (fintech)—it’s trends and gives us some fintech stocks that are on his watch list. His featured stock is, StoneCo Ltd. (STNE) a Brazilian fintech company that Warren Buffett’s Berkshire Hathaway (BRK-B) invested $340 million in at its IPO in late 2018. Carl’s changes today: Replace ProShares Short FTSE China 50 (YXI) with Direxion S&P 500 Bear (SPDN).

Bi-weekly Update February 27: Carl writes that this week highlights that we all need to have a plan to manage risk and build diversified portfolios with quality ideas that produce consistent returns. This allows us to keep calm moving forward while the financial media panics. Last week, he recommended selling around one-third of our stake in Virgin Galactic (SPCE) to lock in some profits—today he gives us additional updates on the company. There is one portfolio change today: Marvell Technology Group (MRVL) moves from Buy to Sell.

Cabot Small-Cap Confidential

Special Bulletin March 6: While enduring this type of market is never fun, Tyler thinks we’ve entered into the current environment in decent position, all things considered. And this virus doesn’t change the fact that we own some of the very best high growth small cap stocks out there. On that note, he has one quick update on the February pick, Luna Innovations (LUNA), which just reported record revenue in Q4. Luna has the dubious distinction of being one of two stocks that are up in our portfolio today (Everbridge is the other). The stock’s 7%+ gain is a phenomenal show of strength in what is a truly horrible day for stocks. It remains a Buy. There is one rating change today, ModelN (MODN) moves to HOLD given the stock’s recent retreat.

Monthly Issue March 5: This month Tyler is jumping into a software company that’s developed an innovative product for the emerging gig economy. But Fiverr International (FVRR) is not another Airbnb, Lyft or Uber. No apartments for rent or cars for hire here. Rather, just like eBay and Etsy have created online marketplaces for buyers and sellers of physical goods, this company has created a marketplace that matches buyers and sellers of digital services—things like graphic design, writing and web development.

Special Bulletin March 4: Cardlytics (CDLX) reported preliminary Q4 revenue results a while back that were better than expected, and last night in the official earnings release and on the conference call management announced that profitability was also way above expectations. Adjusted EPS of $0.18 beat by $0.14; a huge margin. That’s about where the good news ends, for now. Shares are down roughly 30% this morning after management gave very light Q1 2020 guidance (revenue in a range of $43.5 million to $46.5 million is well below consensus of $55.2 million), saying consumer spending is extremely uncertain in this environment due to COVID-19. Tyler is staying with his HOLD rating.

Cabot Dividend Investor

Weekly Update March 4: This has been about as ugly a couple of weeks in the market as you will ever see. On a closing basis, the market hit a low on February 28 and was down 12.5% from the February 19 highs. By total points lost, it was the fastest market correction in history. On an intraday basis, the market fell about 16%. Tom writes about Valero Energy (VLO) and Qualcomm (QCOM) and updates us on the rest of the portfolio stocks. He has no rating changes today.

Monthly Issue February 12: In this issue Tom identifies a company that is defensive and high dividend-paying. But, unlike most stocks in that area, it is still reasonably priced. At the same time, Verizon Communications (VZ) has massive exposure to 5G and a huge catalyst for growth. With this company you can play offense and defense at the same time. He has no portfolio changes today.

Cabot Marijuana Investor

Monthly Issue February 26: Tim writes that you should focus on the leading companies and strongest stocks, which you’ll find in the portfolio. Avoid stocks trading under a dollar (that’s the majority) and stocks hitting new lows. Cut losses short (always a good strategy for growth-oriented investors). And avoid preconceived notions. Anything is possible going forward, but by watching the action of the individual stocks, you’ll be sure to own the leaders when the sector’s uptrend resumes. Tim is recommending these adjustments today: Aphria (APHA) to Hold (Sell a Third), Cresco Labs (CRLBF) to Hold, Cronos Group (CRON) to Hold, Curaleaf (CURLF) to Hold, Green Thumb Industries (GTBIF) to Hold, Organigram (OGI) to Buy and Trulieve (TCNNF) to Hold. (Sell a Third)

Update February 14: Marijuana stocks have been building a meaningful bottom since November—and there are good and bad aspects to that. On the good side, it means that you’ve had the opportunity to buy low—so you can sell high later on, or just hold to build long-term profits. On the bad side, it means that until the sector revives, any money invested in the stocks (in general) will not perform as well as money in sectors that are currently strong. Today, Tim has two portfolio changes: Akerna (KERN) and Planet 13 (PLNHF) both move from Buy to Hold.

Cabot Early Opportunities

Special Bulletin February 28: The market has been tripped up by what seems to be an overreaction to the potential economic disruption of the coronavirus, but which is more likely the result of a trifecta of potential issues including coronavirus, a previously elevated market trading at high multiples, and uncertainties related to this year’s Presidential election. Tyler calculated the average return of current BUY and HOLD rated stocks since we started Cabot Early Opportunities through yesterday’s close. On average, our stocks are up 5% (many are still up double digits). He gives updates on all stocks.

Monthly Issue February 19: In this month’s Issue of Cabot Early Opportunities Tyler discusses one simple way to measure how much a given stock will move relative to the market. He also features five stocks, from quite small to larger than we normally go. All have something different going for them. He is tilted toward software names this month, though he rounds things out with another solar name and an emerging biotech opportunity. This month’s Top Pick, Varonis (VRNS), is on the backside of a transition to the SaaS business model

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Updated - 1/27/20 - Bonus Report: 3 Canadian Small-Cap Stocks to Buy Now
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Cabot Profit Booster

Weekly Issue March 3: Datadog (DDOG) - Today, the widespread, ongoing move to the cloud by businesses of all sizes means there are all sorts of customized apps and differentiated hardware that don’t always work together the way they’re supposed to. Enter Datadog, which has one of the top new-age monitoring and analytics platforms for development, operations and business users, providing real-time, actionable insights and alerts regarding these firms’ infrastructure. The Covered Call Trade — Buy Datadog (DDOG) Stock at 44.5, Sell to Open April 43 Calls (exp. 4/17/2020) for $4.50, or a Net Price of 40 or less.

Frequently Asked Questions Report:

Frequently Asked Questions

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Wall Street’s Best Investments

Daily Alert March 6: Brookfield Asset Management Inc. (BAM) Forecasts & Strategies
Daily Alert March 5: National Retail Properties, Inc. (NNN) Contrarian Outlook
Daily Alert March 4: Equifax Inc. (EFX) DRIP Investor
Daily Alert March 3: BioMarin Pharmaceutical Inc. (BMRN) The Medical Technology Stock Letter
Daily Alert March 2: Vera Bradley, Inc. (VRA) AlphaProfit Sector Investors’ Newsletter

Monthly Issue February 20: Nancy’s Spotlight Stock, Tyson Foods (TSN), is a major protein producer that is benefiting from restructuring, rising meat demand, and the African swine flu that has devastated the Asian pork markets. Her Feature article further explores the company’s markets and acquisitions.

Ask the Experts

Cabot Growth Investor

Question: I conducted a crude analysis of what my portfolio is tonite against what it would have been using todays prices and if no selling was done. I partially sold off mostly to raise cash in some stocks and completely sold IPHI, TSLA, MO. Before this started, I was fully invested and went to about 40% cash today. To my surprise, my total portfolio amount is almost equal - as if I did no selling! Granted I am better prepared if the market continues to decline and have cash to invest when the market starts to recover. Can you provide any insight with this particular situation?

Mike: So, I am always up for studying results, so I think this is a good thing to do. But, not to throw stones, but you’re talking about one point in time – if the market falls tomorrow, does that mean all the sells were good? And if they rally after that, bad again? So on and so forth. I think one better way to consider is to let more time pass and then look at the reasons (rules or tools) you sold – and whether they worked or not, and why they might have worked or not. Were there one-off reasons why they didn’t work? Etc Etc. As for the study so far, I think it’s a matter of a big bounce yesterday and a tough situation – to this point, the correction is only 7 days old or something, so unless you sold in the first 3 days (possible), you might be even or a bit worse etc etc. Just my take – again, not dumping on looking back, we do it all the time; it’s a good thing to do. But at this point it’s a touch early to conclude one way or the other.

Cabot Options Trader

Question: Would airlines be a good call option buy?

Jacob: That really is the million dollar question ... how bad is the damage to the airlines? That being said, there is no doubt that calls are “cheap” if you wanted to play a longer term turnaround (which I’m not ready to do yet).The AAL January 20 Calls are offered at $3.40The LUV January 47.5 Calls are offered at $6.25 And then this headline just hit (not surprising) ...UAL = REDUCING FLIGHTS & FREEZING HIRING BECAUSE OF CORONA

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Quarterly Cabot Analyst Meeting

The recording of the quarterly Cabot Analyst Meeting from January 15, 2020 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.

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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
ADBEHold
ALXNStrong Buy
AMZNStrong Buy
ANFHold
APHASee Advisory
APPFHold
AREHoldHold
ARNABuy
AVGOSoldHold
AVLRBuy
AXNXHold
BABABuy
BIPHoldHold 2/3
BKRHold
BSCLBuy 1/2
CCIHold
CDLXHold
CGCSee Advisory
CHCTHold 1/3
CRAKHold
CRLBFSee Advisory
CRONSee Advisory
CURLFSee Advisory
CZZBuy 1/2
DAVAHold
DBISoldBuy
DOCUBuy
DOMOHold
DOWBuy
DTHold 1/2
DXCMBuy
EPDBuy
EQHSellBuy
EVBGHold
EVERHold 1/2
FVRRBuy
GESHold
GMHold
GRWGSee Advisory
GSHold
GSHDHold
GTBIFSee Advisory
HCATHold
HTHTHold
IIPRSee AdvisoryBuy
INSPHold
IPHISoldSell
KERNSee Advisory
LGIHHold
LKBuy 1/2Hold
LUNABuy
LXBuy 1/2
MCYHold
MEXXSold
MKSIStrong Buy
MOHold
MODNHold
MOSSell
MPCBuy
MRVLSold
NEEHoldHold 1/2
NFLXStrong Buy
NVCRBuy 1/2
NVDAStrong Buy
OGISee Advisory
PGXBuy 1/2
PLNHFSee Advisory
PNGAYBuy
PWRBuy
QCOMBuy
QTWOBuy
RDFNSold
RGENBuy
RIOBuy
RNGHold
SEBuy 1/2Sell/DropHold
SFLHold 1/2
SGENBuy
SOXSSold
SPCEBuy a HalfBuy
SPDNBuy
SPXSSold
SSOHold
STAGHold
STNEBuy 1/2
TCNNFSee AdvisoryHold
TDOCHold 2/3
TOTHold
TPBSee Advisory
TSLAHold
TSNHold
UEICHold
VLOBuy
VOYAHold
VRTXHold 2/3Buy
VZBuyBuy
YXISell
XELHold 2/3