Friday File: “Amazon-Like Profit Profile Could Double Investors’ Money Again This Year”

Solving a Cabot teaser, plus a few buys and sells as 2020 heats up

By Travis Johnson, Stock Gumshoe, January 17, 2020

Happy New Year! Today I’ve got a teaser solution for you from one of the Cabot newsletters, and you’ll see in a minute why I chose to cover this one in the Friday File… and I’ve also got a few portfolio updates to share as the year gets underway and I finish up this first Friday File of 2020.

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First, let’s check out that teaser pitch — the ad is from Mike Cintolo for Cabot Growth Investor ($247/yr), and he’s calling this idea “The Next Amazon”… here’s how the ad starts:

“This Stock is on Track to Hand You 100% Gains

“How its Amazon-Like Profit Profile Could Double Investors’ Money Again This Year

“The financial media isn’t writing about it. Nor are the brokers recommending it.

“Yet, it’s on track to double investors’ money again, just as it has twice over the past two years.

“That’s why I’m writing: to tell you about this company that’s set to double investors’ money again this year … and become the next Amazon along the way.”

That all sounds quite generic, no? Indeed, Cabot uses very similar language to tease almost all of its growth stocks. How about some specifics?

“I’m not the only one who sees this company becoming the next Amazon-like success story. Wall Street’s top institutional investors do too, owning millions of shares worth more than $5 billion.”

That doesn’t really mean anything by itself, but knowing that the market cap is above $5 billion is a decent clue. What else?

“Over the past two years this company handed investors 50% more gains than Amazon, Apple, Facebook and Google—that’s 111% to 55%, 54%, 0% and 25%, respectively.”

He talks about “this year” as 2019, so presumably this data is a bit old (it made it into ads I saw on January 11, but the text for these often lingers and gets re-used from time to time). And Apple has risen by more than 100% since the lows of December 2018, not 54%, so that’s another indication that we’re dealing with some oldish or otherwise wonky data.

Other clues?

“Unlike Amazon, which sells everything under the sun, this near perfect company, the world’s leading provider of telehealth services (also called virtual care), allows millions of patients to access expert medical advice in dozens of specialties.”

And then these tidbits:

“• 40% of the Fortune 500, ...

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