Cabot Investors Conference: the Last Word?
Top Picks Post Average Gain of 84.5%
WhiteWave Foods (WWAV)
But I have more to add, and whether this is the last word on the event or not depends largely on whether other Cabot analysts may feel compelled to share their own thoughts.
Here are my takeaways.
We have an awesome group of Cabot investors, intellectually thirsty and broadly experienced. Some are experienced, some are beginners, but they all enjoy it and are eager to learn more.
As for our analysts, while the diversity of the investment styles of our analysts is fairly clear, the color added by personal interaction with the analysts was priceless. The attendees loved sharing ideas with all of them, whether it was in Q & A sessions, on the schooner Fame or in the hotel bar.
Mike Cintolo of Cabot Market Letter and Cabot Top Ten Trader lives and breathes growth stocks and market timing. Mike relishes great growth stories, especially mass-market growth stories, but only when they’re backed up by strong financials and good chart set-ups.
Thomas Garrity of Cabot Small-Cap Confidential doesn’t care about charts at all, but he’s the most thorough researcher of little companies that I’ve ever known. And the ideas he comes up with are tantalizing, like a system that uses Wi-Fi waves to charge your mobile phone when it’s anywhere within range. Who wouldn’t want that?
Roy Ward of Cabot Benjamin Graham Value Investor is our value guru, with 400 columns of data on each stock, and specific Maximum Buy Prices and Minimum Sell Prices on 1,000 high quality stocks. Roy is as sober as a judge and his system is the Cadillac (can I say “the Tesla”?) of value investing systems.
Jacob Mintz of Cabot Options Trader and Cabot Options Trader Pro knows how to trade options and win, while controlling for risk every step of the way. He’s got a sharp mind and a sharp sense of humor to boot.
Chloe Lutts Jensen of Cabot Dividend Investor is our dividend expert. Her system steers subscribers to stocks that promise both rising dividends and capital appreciation, so if you buy early, you end up with a super stream of dividends. The second of my three children, Chloe is smart as a whip and I wish her grandfather could see what she's contributing to the company he founded.
Nancy Zambell of both Investment Digest and Dividend Digest reads or skims 286 investment advisories a month (some of which publish many times in that month) to find the best investment for her readers. Nancy is a true professional, and a great public speaker.
Paul Goodwin of Cabot China & Emerging Markets Report is the master of bon mots, quips and anecdotes and he was a great moderator throughout the conference. He’s also the world’s greatest expert on hot Chinese stocks, which are flying high today. How far will BITA go?
As the head of Cabot, I respect all these successful investing systems, and it’s my mission to help people find the right system(s) for themselves. Personally, though, I love great growth opportunities, especially in companies that aren’t well known yet.
Three years ago, Tesla Motors (TSLA) was such a company, but today, it’s way too high profile. So at the conference, I mentioned a couple of new possibilities, focusing on one for my Top Pick.
No, I can’t tell you my top pick here, but I will tell you something very impressive.
At last year’s conference, six analysts made Top Pick recommendations.
Roy Ward, master of data, kept tabs on them throughout the year, and reported that the average gain of the six from then until now was an astounding 84.5%. The average!
That’s very impressive.
But even more impressive was the word that one of last years’ attendees bought LEAPS (long-term equity anticipation securities) on all six stocks and netted a gain of 300%!
I guess that paid for her conference!
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They Laughed When I Bought Tesla …
Last year, when we told our Cabot Top Ten Trader readers to back up the truck and buy Tesla with both hands, we got a lot of flak from my colleagues in the trading world.
But now that it’s handed our readers 600% profits, it’s no wonder why Cabot Top Ten Trader is considered Wall Street’s leading trading advisory.
As you’ll see in this week's Cabot Top Ten Trader, our latest top 10 trades are no joke either.
Get the entire buy list FREE tonight and see for yourself. Click here for details.
As to the market, I’m getting nervous, partly because of the Cabot market timing indicators, partly because of investor sentiment, and partly because of valuation.
No one indicator works all the time, but when enough are talking, I’m not going to ignore them.
So today I’m going to suggest a stock that has relatively low risk but still has good upside potential.
White Wave Foods (WWAV)
I previously recommend WWAV here on April 28, when it was trading at 27. Now it’s at 33, having just broken out to a new high.
And that’s important because with market leadership narrowing, those stocks moving to new highs (but not on parabolic paths) are the ones you want to be in.
WhiteWave, for the record, was spun off from food giant Dean Foods in October of 2012.
Dean Foods kept its traditional milk, cream and ice cream business while WhiteWave got the faster-growing non-dairy businesses.
Today, WhiteWave produces a variety of popular organic food and drinks, including Silk, Land O’Lakes, Earthbound Farm (which it bought in January) and Horizon Organic.
Revenues were $2.5 billion in 2013, up 11% from the year before, but the Earthbound Farm acquisition should see earnings climb at least 34% this year.
And the stock’s PE is now 38. Not bad.
I like the trend toward organic food in general, as do growing numbers of Americans.
And I like WWAV’s chart.
The trend is clear.
And the news is good.
In fact, just two weeks ago, the company released its second-quarter report, and handily beat analysts’ estimates.
Gregg Engles, chairman and CEO, reported strong growth in all four segments: Plant-based Foods and Beverages, Coffee Creamers and Beverages, Premium Dairy and Organic Greens.
The report sparked a gap up from 30 to 33.
Last week the stock worked on consolidating that gain.
And last Friday it broke out to a new closing high!
(Also—and this gets a little technical—the stock also sports a new RP peak, meaning it’s performing better than the market. Pretty good for a food stock with a solid core business.)
If you’ve owned WWAV since my original recommendation, congratulations. You should hang on to most of it, but you should consider taking a little off the table here. As Tom Garrity says, “Pay yourself first.”
And if you didn’t buy it back when it was 27, you could buy it now.
But even better would be to go to the source of the original recommendation, Mike Cintolo’s Cabot Top Ten Trader.
For every stock recommended in Cabot Top Ten Trader, Mike gives a precise buy range, as well as a stop loss for controlling risk. So while you might get lucky doing it on your own, your odds are better if you follow Mike.
Yours in pursuit of wisdom and wealth,
Cabot Wealth Advisory