CEO Watchlist: Week In Review (12/7/25)

The Market Might Be Broadening Away From Big Tech: 5 Small To Mid-Cap Stocks We Like For 2026! (Source)

Stocks mentioned: $OSS, $TMDX, $RBRK, $THR, $ONDS

The consensus narrative says big tech carried the entire market in 2025, and that part is true. We believe big tech continues to offer real upside heading into 2026, especially with AI spending accelerating and profit margins widening across the sector. But here is the real challenge to conventional thinking: if investors want extraordinary returns instead of ordinary ones, they will need to look beyond mega-caps. The most overlooked assets in this market are sitting in the small and mid cap universe, where companies may not be profitable yet, there is risk of dilution, and competition is fierce. But because of these risks, there is a lot of room for upside opportunity if you know where to look.

Now for some of you who are newer to investing, you may not be familiar with the phrase "market cap", but all a market cap is, is the total value of a company in the stock market. You get it by taking the stock's share price and multiplying it by the number of shares that exist for that stock. Simply put, it tells you how big a company is. This matters because size affects risk. Smaller market cap stocks can move faster and grow quicker, but they can also drop harder since they are less stable. Bigger market cap stocks usually move slower, they are more established, and they tend to carry less risk. Knowing the size of a company helps you understand what kind of ride you are signing up for before you invest. Obviously this is important to note, because in this article, we are focusing on investing in small to mid-cap stocks, which will naturally have more risk to them, but also higher upside potential for profits. Now, for our thesis...

Our thesis rests on several forces converging in early 2026 along with positive catalysts, specifically for small to mid-cap stocks. Markets are preparing for a new Federal Reserve chair appointed by President Trump, who is expected to be more market friendly than the current leadership. A more accommodative stance can support liquidity conditions and increase investor appetite for smaller companies that rely more on borrowing and capital markets. Rate cuts, in particular, historically help small and mid cap stocks because those companies tend to have higher refinancing needs and more sensitivity to financing costs. Lower rates improve profitability, expand growth capacity, and often accelerate multiple expansion. Alongside this, seasonality trends are favorable, since the next three months have historically shown strength.

This sets the stage for one of the most compelling broadening opportunities we have seen in years. For 2026, our view is simple: if we want decent returns, we should stick with the tried and true mega-cap tech stocks. If we want extraordinary returns, then we need to take a lot more risk, and start looking in the small to mid-cap areas of the market. We have refined a process over many years for uncovering these type of opportunities in the stock market. We look for companies with improving fundamentals, upcoming catalysts, strong earnings growth, momentum, and asymmetric risk to reward ratios. While smaller-cap names come with higher volatility and should always be approached with discipline, they often deliver the most dramatic re-ratings when conditions shift. Today, we want to share several of the companies that currently stand out through this process. Each carries a lot of risk, so investors should always perform their own due diligence before taking action and should even consult with a financial advisor. That being said, here are the 5 stocks:

One Stop Systems (OSS) - Provides specialized computing infrastructure for AI, autonomous systems, and edge computing. The bull case is centered on rising AI hardware demand outside the major cloud providers and new defense contracts. Analysts see meaningful upside over the next year, with target ranges implying strong double digit growth potential. According to TradingView, analysts give OSS a "Strong Buy" rating.

TransMedics (TMDX) - A medical technology leader focused on organ transplant systems. Its Organ Care System has rapidly expanded adoption, which can drive higher revenue and margin growth through 2026. Analysts expect robust growth and project significant upside as the transplant ecosystem continues modernizing. According to TradingView, analysts give TMDX a "Buy" rating.

Rubrik (RBRK) - A cybersecurity and data protection company gaining share as businesses modernize cloud infrastructure. Rubrik sits at the center of the AI data cycle, since companies increasingly need secure, scalable data backups. Analysts project strong revenue acceleration and see a path to higher valuations driven by enterprise spending. According to TradingView, analysts give RBRK a "Strong Buy" rating.

Thermon Group (THR) - A provider of industrial technology solutions for energy, chemicals, and infrastructure. Thermon is positioned to benefit from the continued reshoring trend and investment in critical infrastructure upgrades. Analysts expect earnings growth to strengthen through 2026 with moderate but steady upside potential. According to TradingView, analysts give THR a "Buy" rating.

Ondas (ONDS) - A wireless networking and autonomous systems company focused on rail, drone, and industrial applications. The bull case hinges on regulatory progress in autonomous aviation and the adoption of next generation rail technology. Analysts covering the stock see substantial room for appreciation if commercial deployments accelerate next year. According to TradingView, analysts give ONDS a "Strong Buy" rating.

The story for 2026 is straightforward. Big tech will continue driving innovation, but the market is preparing for a broader advance. A new Fed environment, a more supportive rate cycle, and favorable seasonality combine to create a powerful backdrop for smaller companies to rerate higher. With the right research process and disciplined selection, small and mid cap stocks can deliver the type of returns that most investors miss when they focus only on the giants. The broadening is coming, and the market has not fully priced it in yet. If you want to see our entire list of stocks and options that we are buying, make sure to join the CEO Watchlist Investment Club. As a thanks for being a newsletter subscriber, we're granting you a $200 OFF discount when you join today! If you want to learn how we find winning stocks before they take off, then [CLICK HERE] and lock in your spot.

The 4 Stocks We Think Will Do Well This Earnings Week, and The 1 We Think Could Falter! (Source)

Stocks mentioned: $ADBE, $ORCL, $SNPS, $AVGO, $COST, $NVDA

Investors usually treat earnings season like a scoreboard, but that framing misses the point. Quarterly results are not just profit updates, they are real-time diagnostics of the entire economy. When companies reveal revenue growth, margins, customer demand, and forward guidance, they give us a bottom-up look at how households, businesses, and global markets are actually behaving. In a market where macro headlines are loud and volatility is rising, earnings are the clearest signal that cuts through the noise. This week’s reports from Adobe (ADBE), Oracle (ORCL), Synopsys (SNPS), Broadcom (AVGO), and Costco (COST) will act as a stress test for three of the most important themes of the moment: enterprise software demand, AI infrastructure spending, and consumer strength.

The macro backdrop has shifted. Rate expectations are stabilizing, enterprise budgets are loosening, and AI spending is moving from hype cycles into real deployments. The constraint is no longer investor imagination, it is execution, the ability of companies to convert AI promises into measurable revenue and durable customer retention. That is why Adobe (ADBE), Oracle (ORCL), and Synopsys (SNPS) sit at the center of the moment. All 3 are reporting their earnings Wednesday after the market closes, so investors should watch for accelerating subscription growth, upticks in new customer additions, and clear commentary on how AI tools are influencing selling cycles. Adobe’s Digital Media business and Firefly AI adoption rates will tell us if companies are still spending on productivity tools. Oracle’s cloud growth and ramp in AI-related workloads will reveal whether the company can keep pulling share from hyperscalers. Synopsys, the dominant player in semiconductor design software, will be the clearest window into chip development demand for 2026, especially after their recent Nvidia (NVDA) partnership.

On the hardware and infrastructure side, Broadcom (AVGO) is the bellwether. They report earnings on Thursday after the close, so investors should focus on networking demand, custom accelerators, and updates on its AI chip pipeline. Broadcom’s margins often act as a proxy for supply and pricing power in the semiconductor supply chain. Meanwhile, Costco (COST) also reports Thursday after the close, but offers a completely different but equally important signal. As one of the most reliable measures of consumer health, Costco’s traffic, membership renewals, and same-store sales growth can confirm or challenge the current belief that the consumer remains resilient. Some argue that strong retail numbers simply reflect inflation rather than real activity, but the counterpoint is simple, resilient membership-based retailers historically outperform when the economy is cooling because consumers migrate toward value.

This week’s earnings should reinforce a simple point: companies that deliver solid results this quarter and offer confident guidance for the next one are the ones investors will reward. The upcoming reports are especially important because Adobe, Oracle, Synopsis, and Costco have all pulled back from recent highs amid market concerns. Broadcom has held its strength better than the rest, which raises the stakes for its report as well. A small miss could lead to a sharp reaction. We expect strong quarters from Adobe, Synopsis, Costco, and Broadcom. Oracle, however, may face some pressure due to softer revenue and EPS trends along with a heavier debt load. As the year winds down, the advantage belongs to companies that turn structural tailwinds into consistent execution, and several of this week’s reporters are positioned to do just that.

"Super Investor" Spotlight: Josh Tarasoff (Source)

Stocks mentioned: $AMZN, $BN, $BRK.A, $MKL, $TSLA, $TRUP, $GOOGL, $BUR

This week’s "Super Investor" Spotlight turns to Josh Tarasoff, founder of Greenlea Lane Capital, a highly respected yet intentionally low-profile fund manager known for patience, discipline, and a deep understanding of business fundamentals. For new readers, a “Super Investor” is a money manager who oversees substantial capital and consistently outperforms through skill rather than luck. Each quarter, they must file a 13F report, which shows us exactly which stocks they own. Tarasoff’s filings are especially valuable because his strategy is simple: concentrate heavily in only the highest-quality companies and hold them for years. His long-term track record has earned him a reputation as one of the most trusted long-horizon thinkers in the hedge fund world.

Tarasoff’s Q3 2025 portfolio is dominated by 8 elite businesses and while some investors view concentration as risky, Tarasoff views it as essential, since it forces him to only own the businesses he understands deeply and expects to compound for decades. So, here are all 8 of the long-term stock positions that he owns currently:

Amazon (AMZN) - 20.6%
Brookfield (BN) - 19.0%
Berkshire Hathaway Class A (BRK.A) - 14.7%
Markel (MKL) - 12.5%
Tesla (TSLA) - 10.3%
Trupanion (TRUP) - 9.6%
Alphabet (GOOGL) - 7.4%
Burford Capital (BUR) - 5.8%

So you may be asking how has this "Super Investor" performed vs the S&P500, because why look at someone's stock portfolio who can't even beat the broad market index? It should come as no surprise that Josh Tarasoff of Greenlea Lane Capital has consistently beat the stock market with returns of 150% over the past 3 years vs. the S&P500, which only returned 86% in the same time period (as can be seen below). That's a massive outperformance by Greenlea Lane Capital and exactly why we research and analyze what "Super Investors" are buying every quarter.

In conclusion, we like Josh Tarasoff because he plays the game differently. He ignores noise, focuses on durable businesses, and invests with a decades-long mindset. His Q3 2025 filing reinforces that philosophy by leaning into proven global compounders that have consistently proven to outperform the market. The lesson is simple: find great businesses, understand them deeply, and hold them long enough to let compounding work. Tarasoff continues to model exactly that, and his portfolio remains one worth studying closely.

INSIDER STOCK TRADES FROM THE WEEK:

1. Blend Labs (BLND) - Private Equity Firm Haveli Investments, bought roughly $21,700,000 of BLND for $3.08-$3.14/share between Dec. 1-3, 2025, and it was most recently reported to the public on Dec. 3, 2025. (Source)

2. Blue Owl Capital (OWL) - Marc Lipschultz, Co-CEO, bought roughly $2,300,000 of OWL at an average of $15.06/share between Dec. 1-2, 2025, but it was most recently reported to the public on Dec. 3, 2025. (Source)

3. Johnson & Johnson (JNJ) - John Morikis, Director, bought over $250,000 worth of JNJ at $206.15/share on Nov. 26, 2025, but it was most recently reported to the public on Dec. 1, 2025. (Source)

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