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| S&P 500 |
7,763 |
+0.5% |
| Dow |
52,441 |
+0.6% |
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| Nasdaq-100 |
30,228 |
+0.9% |
| Bitcoin |
$83,757 |
+4.4% |
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| S&P 500 |
7,763 |
+0.5% |
| Nasdaq-100 |
30,228 |
+0.9% |
| Dow |
52,441 |
+0.6% |
| Bitcoin |
$83,757 |
+4.4% |
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1. Rocket Lab’s Electron Keeps Flying |
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Rocket Lab, recommended by both Team Hidden Gems and Team Rule Breakers, launched its 96th Electron mission on Sept. 19. Electron, the small-lift rocket, has flown 17 times in 2026 and books revenue on each launch.
Electron carried the 12th StriX satellite for repeat customer Synspective, and Rocket Lab has already booked 15 more flights for it through 2030. The stock rose around 2% in pre-market trading.
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Electron is buying Neutron time: Rocket Lab still loses money. Profitability and cash flows depend on the first successful test launch of its medium-lift rocket, Neutron. Until Neutron flies, Electron keeps the revenue flowing. Rocket Lab’s total backlog hit a record $2.36 billion in the second quarter.
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Team HG made over 20 recommendations across TMF services: Rocket Lab shares have fallen more than 50% since peaking in May. Team Hidden Gems retains a strong conviction, with multiple recommendations in recent months. The upcoming Iridium acquisition should take care of Rocket Lab’s cash deficit. Warren Buffett's advice to be greedy when others are fearful applies exactly in this kind of sell-off.
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Team Hidden Gems has a 5-year price target of $188.53 on Rocket Lab. |
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2. Rewire How You See Your Losers
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Can a loser stock still win? Team RB analyst Emily Flippen thinks so, and discussed the upside of ditching your cost basis in a weekly column sent to Epic Portfolio members on Friday. Here’s an excerpt.
By Emily Flippen, Team Rule Breakers
Pretend you're an equity research analyst and you've done the work on Company ABC and Company XYZ, both held in a tax-advantaged account like an IRA, so we can set aside tax considerations for now. You have $1,000 to invest, and you believe XYZ will deliver 15% annualized returns over the next five years while ABC will deliver 10% over the same period. Which do you want to buy? Your research says $1,000 in XYZ turns into roughly $2,000 in five years versus about $1,600 for ABC.
But now let's pretend you already own Company XYZ, and shares are down 90% from where you initially bought them. Which do you want to buy now?
Many investors will reverse course and choose Company ABC. Removing the red from a portfolio in favor of green always feels better. However, the capital you already lost on XYZ is gone in either scenario, and selling XYZ to buy ABC still leaves you with less money five years from now. The market does not care what you paid. It only cares what the business does from here. And because these holdings sit in a tax-advantaged account, there's no tax bill to weigh either way; the number on your brokerage statement has no bearing on your investment thesis.
So instead of asking what I paid, I try to answer three questions:
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- What do I think this business can do from today's price?
- Where else could these dollars go? And
- Would these dollars do better there?
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3. Weekly Recap: Treasury Yields Top 5% for First Time Since 2007 |
The S&P 500 slipped 0.08% last week while the Nasdaq added 0.72%. Bonds made the bigger move, with the 10-year Treasury yield briefly topping 5%, a level it hasn't touched since 2007. Futures pointed higher this morning after Treasury Secretary Scott Bessent called talks with China "a very successful engagement." S&P 500 and Nasdaq futures rose about 0.5% and 0.8%, respectively. |
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Rate hikes are back: The Federal Reserve's first interest-rate hike in three years dominated the week's economic news, as traders now brace for more. The CME FedWatch tool puts the odds of another hike in October at 53%. It puts the odds of a higher year-end rate at up to 88%.
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Oil retreats, Bitcoin rebounds: Oil held above $100 a barrel most of last week as Middle East tensions threatened global crude flows. WTI crude has since settled back to just under $93. Bitcoin, recommended by Team Hidden Gems, recovered above $81,500 after the Clarity Act cryptocurrency regulatory bill collapsed.
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4. Cintas, Stitch Fix, and Costco: This Week's Earnings Tests |
Three Team Hidden Gems recommendations report earnings this week. |
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Cintas, the uniform and safety-supply provider, reports first-quarter results Wednesday. Last quarter, revenue grew 8.9% and the operating margin expanded despite added costs from the UniFirst acquisition. The deal should close in the second half of 2026. Management guided full-year revenue to $12.1 billion to $12.3 billion. Watch whether margins keep expanding as Cintas folds UniFirst in.
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Stitch Fix, currently in the Stock Advisor Penalty Box, reports Q4 the same day. The online personal shopping and styling platform topped its own guidance in Q3, as revenue rose 4.7% over the same quarter a year ago. Existing clients spent more, but active clients fell 1.9% year over year. Whether that count turns positive is the question that matters most.
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Costco drops its Q4 report Thursday, and Wall Street's bracing for another blowout: revenue near $94.9 billion, up 10%, with earnings per share climbing roughly 12%. Last quarter's revenue jumped 11.6%, driven partly by a 20.8% rise in digitally-enabled sales. Watch for any news on a rumored special dividend, and whether Costco's high membership renewal rate continues.
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5. Meta's 27-Bagger Rolls On
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Team Hidden Gems’ first Meta Platforms buy, back in July 2013 at $24.20, has compounded into a 27-bagger. Meta was still called Facebook then, mobile ads were an unsolved problem, and Instagram was a $1 billion side bet. Thirty-plus recommendations later across Team Hidden Gems services, shares trade at $653.69 and our conviction has only grown. |
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Ad engine's second wind: Revenue climbed 28% year over year in the second quarter of fiscal 2026 to $60.8 billion. Artificial intelligence (AI) tools for ad targeting drove much of that lift, and family daily active people crossed 3.60 billion. Meta's core ad business has funded every pivot from mobile to virtual reality to AI, and it looks stronger today than ever.
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Cash flow squeeze, thesis intact: Meta's aggressive AI infrastructure build hammered free cash flow, which fell 91% year over year to $784 million last quarter as capital expenditures hit $30 billion. This investment cycle tests long-term investors, and Meta has earned our patience over 14 years of compounding.
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Team Hidden Gems has a five-year price prediction of $1,284.30, close to a double from today's price. When Tom first recommended Facebook in 2013, he wrote that he'd be shocked if shares didn't double within five years. The stock beat that handily and hit $200 by the summer of 2018, a gain of more than 8x, or about 52% annualized.
Thirteen years in, we're still buyers, and we'd add to our position if the market punishes this spending cycle. We like the odds that Zuckerberg's AI bet compounds the next decade the way mobile advertising compounded the last one.
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What gives you the conviction to add to a stock during its worst stretch?
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