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From full global headquarters, this is Motley. Full Money. It's the Motley. Full Money Radio Show.
I'm Chris Allen, joining me in studio this week for Million Dollar Portfolio. Jason Moser from Motley. Full Pro and Options. Jeff Fisher and from Motley.
Full One. Ron Gross. Good to see you. He was always gentlemen.
Hey, hey. We've got the latest on industrials, restaurants and more. We've got a preview of HBO's new documentary on Warren Buffett. And as always, we'll give an inside look at the stocks on our radar.
But we begin this week with Big Tech, Microsoft. Second quarter results sent the stock to a new all time high. And Ron Gross, we've been saying this past few quarters, the cloud, getting it done. It's all about the cloud.
Isn't that a song? Yes, I think so. As though we're up 93%, really impressive. A lot of other good news too though, the office productivity segment up 10%, sales of service tablets, who would have thought up 11%.
So strength not just in the cloud, but that certainly is the headline. That certainly is what's driving the stock. And such a no-delev really deserves the credit for transforming this company. That actually is a surprise that service tablets are up 11%.
Oh, great. When you consider that their big partnership was with the NFL and you had coaches coming out and complaining about the device. Yeah, I was surprised that surprised as anyone. But if you keep an eye out, they have been getting good reviews and you're seeing more and more people talking about the surface.
So maybe I shouldn't have been as surprised. Everything in Microsoft, not Peaches and Cream, obviously, you still have weakness in the PC segment, although better than expected PC overall shipments were better than expected, which helps Microsoft, cell phones, hey, 76% plunge there. I don't think we're surprised about that. But overall, a nice report.
I think the surface tablet, the benefit there is that I think it's a device you can use more for production. And I mean, most offices, most businesses work on some Microsoft software and some capacity. And I think there's just sort of a simplicity there in making the transition from workplace to tablet like that, whereas with something like the iPad, it's not quite as work friendly. So I think Amazon, I think Microsoft doing a very good job of leveraging that professional work force there in exposing the surface of strengths.
Ron, you mentioned Satinadella, his anniversary, his three-year anniversary as CEO is next week. As since he took the corner off as a Microsoft, that stock is basically outperformed the market 3X. It's very impressive. And what he said in this conference call, I think, is indicative of how he has performed.
He said, no status quo in any part of Microsoft. And I think we can see the reorg really took hold. And as you said, the stock is reflecting it, not cheap anymore. 30 times earnings, not the most expensive stock in the world, but at a 5% or 6% earnings growth rate, you've got to be careful.
Sure. Ron, even though it's at 21 times forward estimated earnings, it's still market type of price. And the stock yields 2.3%. Still, if I were a long-term owner of Microsoft, you have more reasons to keep holding it now than you did in many years recently.
Alphabet's fourth quarter revenue came in just north of $26 billion. And Jason Moser, that just wasn't enough to impress Wall Street. I love the stock market. You tell any Joe Schmo out there that Google just ranked about $26 billion for the quarter and they're astonished and the stock market holds it against them.
This is a big business, OK? But the hurdles get more and more difficult to clear because they continue to really, I think, perform wonderfully. And as you mentioned, $26 billion, this is a search company. But when you go through the call and you see where they're placing their bets, their three big bets are YouTube, cloud, and hardware.
And I think the big question coming into this quarter for me at least was in the Pixel, right? And we wanted to see if they were actually going to be able to pick up any market share, take advantage of this opportunity with Samsung's misfortunes. There's not a lot of clarity there other than management saying, hey, we like where we're going and we think we've got a great product out there and we're figuring out ways to integrate it with our technology. And it's interesting, all of the talk we've heard over the past couple of years, we've got to mobile, mobile, mobile.
With Alphabet, with Google, it's becoming more about moving away from mobile and becoming AI first, right? Artificial intelligence first, and figuring out ways to take computing over to that next dimension, so to speak. And then I think it's what the Google Home device is a little bit about. I think that Amazon has done a lot of work there on the Alexa front, the Echo front.
So I think a lot of those, that's the type of thinking that's really guiding this company right now. And I think that makes a lot of sense too because a risk here to keep in mind is that Amazon is launching a paid search product. And I think that's based on the fact that a lot of search for brands and products already initiated via Amazon's website and apps. So Google is figuring out ways to diversify their revenue stream and I think that's a good thing.
That's true. And ad revenue made up 89% of revenue last year and this quarter was 85%. So it's still obviously the vast majority, but they are moving away from that. As Jason said, I wouldn't be surprised if five years from now ad revenue was more along the lines of 50% of revenue.
You go a few years before this even, it was somewhere in the neighborhood of 95. Yeah. Right. And we saw they were able to charge, weren't able to charge at the same price as before Facebook we saw it as well.
Now we're seeing that come back again with YouTube where you can't charge as much either on YouTube as well. And that's hitting the numbers and the revenue obviously as you said earlier, a behemoth amount of revenue, but still it is taking a toll. And to be clear, so far with the Google Pixel phone, those aren't exploding, right? They haven't been banned by the FAA.
So far so good. Shares of Starbucks falling on Friday after a first quarter report that featured the lowest same store sales growth since 2009. It's still growth, Jeff, but that's a pretty long way to go for that type of stat. Yeah, US same store sales only grew 3%, which is still decent in a weak retail environment, but the company really blamed the fact that they have too much demand.
Their new mobile order and pay or mop for short, not the best. 1200 stores in the US had 20% or more of their orders coming through mobile order and pay. So you're getting all these orders at once in the morning and then the risk is having a hard time filling them all. So instead of having a line at the register, you're having a mob at the pick up counter waiting for the drink.
So that would slow down orders for everybody. And they say people left the line wouldn't keep waiting for their drink. So anyway, they think that had the most effect on the weak same source sales. I think I get that they're trying to put a happy spin on this and hey, there's just too much demand.
But at the end of the day, lower throughput is lower throughput. It's bad. And so they're working there. They already took steps to to alleviate this.
They looked at the stores where it's working best and they put those into practice. And for newer stores, they're going to redesign the stores to account for the growing practice of ordering through your phone. They just probably drop a spy or two over the Panera here across the street because that is a set up where they've really kind of figured that out. Same problem too much demand.
They couldn't handle it. They handled it through technology and better training and I think Starbucks will do the same. Yeah, they've done it in the past. Chris, everything's going really well.
China revenue up 18%. They're opening a new store in China every 15 hours and plan two for years ahead. Caterpillar's fourth quarter results were better than expected but the industrial giant cut guidance for 2017 helped me make sense of this wrong. This is a stock that over the past year is up somewhere in the neighborhood of 65%.
Exactly. I don't expect that from my blue chips. I'm glad you I'm glad you phrased it that way. So it's an interesting dichotomy.
The stock performance doesn't jive with the results or even the outlook. This quarter's revenue was down almost 13%. They talked about continuing slump and mining and construction. There's two things going on.
One, things were so bad that any type of recovery you can end up seeing a bounce in the stock. But two, people are really hanging their hats I think to a large extent on Trump's policies. Whether it's infrastructure spending or tax and likely it's both in the case of Caterpillar. If there is a meaningful infrastructure plan and if he does lower corporate taxes, Caterpillar will be a huge beneficiary of it and you're seeing the stock price reflect that.
Be careful though because if you don't see one or both of those things investors couldn't end up getting hurt. And we knew sort of coming into this year that a lot of that massive write down that they had in China was a lot of the work that the management team at Caterpillar has been doing over the past couple of years is essentially trying to get that off the books. And it feels like now they're in a position where they can start the growth again. Yeah, $600 million in paramean charge and lots of restructuring charges and the employee count is down.
They're leaner. They're in a position to really benefit once the mining and construction industries turn. But we've been saying that year after year after year, it hasn't happened yet. Eventually it will happen.
The strong dollar, especially since Trump was elected, is another drag on their earnings. Another reason they had a lower guidance for this year. Do we need another word besides impairment? An impairment charge sounds like 50 bucks on a monthly bill that you get in the mail.
It's such a million. It's not a million. Maybe you changed my mind. I mean, we just have to change our mind.
Coming up, the food innovation you didn't know you wanted is here. Details next. This is Monica. Welcome back to Monica Fullmanic for sale here in studio with Jason Moser, Jeff Fisher and Ron Gross.
Not everyone had a happy holiday. Mattel's fourth quarter profits came in much lower than Wall Street was expecting and shares of the toy maker down 17% on Thursday. Jason, new CEO, Margaret Georgiata, starts her job in two weeks and she has really got her work cut out for him. And Hasbro is probably looking to say, thanks a lot, guys.
It's a little bit of a job on their stock. Yeah. Mattel's earning certainly bled into Hasbro for really no reason at all. I mean, I don't want this to all be on Mattel.
I mean, this wasn't just a Mattel specific thing. We've seen numerous challenges in retail from the holiday court. But with that said, Mattel is clearly a company in crisis. And I think new leadership stepping in is sorely needed.
So I'm cautiously optimistic there at least. But I think we've said this before with Mattel, the success there is really about identifying the quality IP that's out there in the world and hitching your wagon to that store. And so a perfect example of not doing that was when they lost the Disney Princesses deal. And you can even see in the release where they excluded the Disney Princesses deal to normalize their earnings revenue for the year in the quarter.
It just won good by any measure. So I think with Mattel, the picture going forward looks challenged. They're trying to right size the business a little bit. They're going to be stuck with a lot of inventory here.
They're going to see some pressure on margins early in 2017. Guidance for 2017 is still in limbo. And I think that's what has the market really scared. And rightly so, clearly Mattel is still trying to figure out how to make that leap into the digital age, whereas Hasbro, I think, has done a much better job with it.
We will sort of wait to see how their results come out. Qualcomm's first quarter results got overshadowed by the lawsuit Apple filed late last week, accusing the chip maker of extortion. I'm not a lawyer, Jeff. There have to be at least a few people who think that Qualcomm's in trouble because they're stuck got a 15% haircut.
It's a pretty strong hit. And personally, I would not want to buy Qualcomm right now, even on that hit. I don't want Apple as my enemy. And the complaint, which runs 104 pages in length, is it's like seeing the sausage made.
You don't want to see that generally. For the past many years, the Qualcomm Apple agreement maintained that Apple had to be quiet. They couldn't speak out against Qualcomm or its practices or whatnot. And Apple had an exclusive agreement to only buy Qualcomm products.
That agreement's over. And now Apple is coming out punching and saying, over all these years, you did this. You did this. Basically accusing them of unfair trade practices, unfair pricing, and royalty schemes.
And yes, extortion. Apple is claiming that Qualcomm tried to extort Apple into changing Apple's responses when it was talking to the Korean Fair Trade Commission in regards to a case there against Qualcomm. Only if Apple would change what it was going to say would Qualcomm pay at some royalties. Apple refused and forfeited those royalties.
Now it's suing for that in part. So it's an ugly lawsuit. I wouldn't want again to be against the table against, around the other side of the table against Apple. No thanks.
Yeah, this is definitely a lot spicier than what we normally see when one tech company goes at another usually. It's some sort of copyright infringement or something like that. You see the word extortion leap off the page that gets your attention. Well, Apple is now buying some modems from Intel who is a few generations behind Qualcomm in quality, but is there.
It's good enough and the price is much lower. So expect Apple to keep trying to get supply from elsewhere because you don't have an enemy like this and want to keep giving it money. McDonald's fourth quarter profits in revenue both came in higher than expected. Global same-store sales came in over two and a half percent and yet the stock was flat run.
What more do they have to do over there? The golden arches. It's a good quarter. I think it was a good quarter.
If that makes a nice... Interesting run. Starbucks is doing that too with personalized orders through your app. Everything's becoming...
It was mobile announced geolocation announced becoming personalized. McDonald's trying to capture some lighting in the bottle, right? By lighting, I mean... Special sauce.
10,000... You know, what's the question? It gave away 10,000 bottles of their signature Big Mac special sauce. They've never done that before.
I think it was actually done already. It's already done. So if you didn't get yours, tough... Our friends over the Howard Stuart show probably got half of them because they love their Big Mac special sauce, but I'm not a kind of a guy.
It's not something that interests me. Are they our friends? Absolutely. Absolutely.
We checked eBay I have to believe that at least one or two people who picked up a bottle of this are going on even Well, this was the deliberation for the week. I mean they were talking about do I open it needed do I save it? I mean I think clearly I mean Mac and I were on opposite ends of the spectrum here where this argument came down But you keep that bottle. I mean it's their number.
I mean there's it's something. Hey, so what if it goes bad in ten years? There's somebody out there's gonna want it. I think it's not going bad ever But they're making an extra bottle too.
This is very interesting making actually 10,000 in one bottles the last bottle They make that extra bottle. They're going to auction off and all of the proceeds will go to the wrong on the gun I'll be very interested to see how much that bottle actually ends up fetching And this does come at the same time as it to new big max or introduce the grand Mac and the Mac Junior so for you enthusiasts of the big Mac you nailed it Oh Chris eBay is marinating in this song I see bottles from a hundred dollars to a thousand dollars in your cost basis is zero It's not an island dressing basic. I was just gonna say this is not a bottle of wine or fine whiskey That's going to you know get better with age. This is but they put a number on the box Shares of hostess brands up this week and why not when you consider the news that hostess is teaming up with Nestle to bring you Twinkie ice cream.
Yes guys starting next month in convenience stores across America You can find not just Twinkie flavored but other hostess inspired ice creams including snowballs and hostess cupcakes ice cream I'm not gonna lie. I'm interested in hostess. Yeah, I mean if I see that I'm picking up a pint or two I bet it does well. I think they'll be demand for you I don't know if it'll last and I don't know how good it'll be but I bet it flies off the shelf in the beginning Let's go to our man behind the glass Steve right off Steve three ice creams Twinkie snowballs hostess cupcake you're picking up one of those three aren't you?
You're gonna give one of those a shot? I think it have to be cupcake that Twinkie doesn't feel cold to me that feels like a warm snack It doesn't feel like a cold snack. I don't know it seems like you get the snowballs and ice cream and it gets all chewy And it's like even my drawers. I think I'd rather have a cupcake The cupcake one really looks like a really nice chocolate with a marshmallow swirl.
I don't know that's if I'm betting on one I'm betting on one of the counterclockwise swirl. I think yeah, I think if they say it's limited edition But come on I mean with any of these things it's limited edition unless one of them's a big seller and then they go Has anyone looked at hostess stock in a while? I mean obviously they had their troubles and they were private and now they're back I don't know from a stock perspective if this is anything to look at this maybe the bicycle Alright guys, we'll see you later in the show up next award-winning director Peter Koonhart talks about the new HBO documentary becoming Warren Buffett Stay right here. This is not the cool market Alright before we get to my conversation with Peter Koonhart got to say word about sure payroll if you're a small business owner You already know payroll can be a headache small businesses pay hefty fines on a yearly basis due to payroll oversights Now you can protect your business and remove the payroll tax complications with sure payroll It's simple and can be used on any device with just three easy steps you enter your employees hours and salaries You preview the taxes being deducted and you approve the payroll and that's it you're done Steve Bridal knows that Steve you're sure payroll customer.
Yes, I am indeed. What do you use it for? We have a talk here providers we get two kids and we use your payroll to pay for that see you can be like Steve Bridal You don't have to have your own small business But their customers do include a range of businesses including dental offices insurance agents restaurants barbershops charitable foundations Tech startups and again Steve Bridal sure payroll has an a plus rating with a better business bureau They make it easy and affordable to manage your small business payroll online So you can focus on your business instead they'll automatically file and pay your federal state and local taxes So go to sure payroll calm slash fool and fill out a free quote form and now let's get to Peter Koonhart Welcome back to Monica money. I'm Chris Hill.
Peter Koonhart is an Emmy award-winning director his latest documentary premieres on HBO on Monday January 30th It's entitled becoming Warren Buffett Peter joins me now from New York. Thank you so much for being here Thank you Chris glad to be here I have to thank the nice people at HBO because because of their efforts I was able to watch an advanced screening of your documentary last night and I was I have to say I was surprised at how personal This film is it includes home movies of Warren Buffett and his children and his wife and that leads to my first question Which is how did you get this level of access to someone like Warren Buffett? Who has to have been in huge demand over the last 25 years in terms of people wanting to tell his story He gave me an hour to come in and speak with him But I then asked him for a follow-up and he kind of be that and I over two years We ended up going the Omaha five times and so the trust and the relationship grew over that time And about halfway through I told him that we just didn't have the visuals to tell his full story And he said I'm gonna open I'm gonna give you everything I've got and His daughter Susie is the keeper of the family archives, so we took two cars over to her house and she Pointed to the closets and the drawers We just emptied everything and scanned everything they had all the albums all the pictures all the headlines and and transferred all the home movies Which hadn't been seen before and and there was no to Warren's credit. There was no filtering There was no saying let me look at this first make sure this is okay for you to say he just said whatever you want You can use and we spent a week scanning it all and I think I think that's what brings kind of that visual Difference to this film that people have not seen before There are a couple of key influences in this film that are really brought to light one on the personal side and one on the investing side And let's start with his late wife Susie because she is as much at the center of this film as Warren Buffett is And I was thinking about the you hear often that well you can't really change who people are but after watching your film It's clear that she changed Warren Buffett.
I'm curious if you could share a couple of thoughts on the ways in which she changed him She 21 when they when they married she was 19 and he was totally fixated on his work and He was all brain and no social skills. He had a very hard time Getting along with with with with kind of the regular things in life She was all heart and I think she said Warren was my first patient And I wanted to help him become kind of a more well-rounded human being and she just molded him and taught him how to Responded to people and how to trust people by the end of the film after we've heard the story of Susie Buffett and Warren He said that he'd never would have been able to to settle as he was without Susie that she she was the reason Berkshire halfway has become What it's become so she gives her as much credit as he gives himself And I think that's one of the reasons Warren is pleased with the film is I don't think that's really come out before I think I think people have loaded him with credit and he's always known that Susie deserves a good part of it the other person on the investing side is Charlie Munger and I guess I'd never really clued into the ways in which Charlie Munger has not only been an amazing business partner for Warren Buffett over the decades But the way in which he appears to have changed Buffett's investing approach when they meet Buffett is really a guy as an investor who's going after the so-called cigar butt stocks the Companies that are on their last legs, but they've got one more tiny bit of value out of them and Munger comes along and really seems to open his eyes to a larger world of investing and for a few years Warren made a lot of money on these small companies that weren't very interesting or glamorous or Or even profitable, but if you say they had they had a few more toaks of smoke out of these little cigar but what Charlie did was open his eyes to good companies at recent prices instead of medium companies at great prices and he taught him that over time by investing in franchises and brands that were trusted and and and part of the culture that Warren could do much better and Warren credits Charlie with with opening those eyes and if you and if you look at the the the the spike in Berkshire value it really it It's a it's a it's an upward movement and then suddenly when when they shift philosophy is investing it just spikes upward So Charlie was right and Warren Warren That's now what what he does and what he's famous for one of the things that Buffett is famous for in investing circles Is his temperament he has said before that when he mastered his temperament that was a huge turning point for him as an investor And yet I was struck by the something that has illustrated wonderfully in your documentary About his acquisition of Berkshire Hathaway and it appears if I'm understanding correctly It appears to be based on a very emotional moment in his life where he's a shareholder of the company The company's management is trying to squeeze just a tiny like an eighth of a share extra out of him And he reacts pretty emotionally and decides, you know what? I'm just gonna acquire more shares and get these guys out of here exactly he he was uncharacteristically Buffett at that time he did what he what he Preaches not to do which is to bring emotion into his business feelings and and Charlie Mongred comments that it was it was just He couldn't understand what he was doing and it did that eighth of a point didn't make any difference But Warren during his interview said you know if I think back to that moment I realized it was five days after my father died and that must have had an impact on me He was very very close to his father. He he's still very close to this to this day He sits at his father's desk.
He hangs his father's portrait behind his desk He he lives and breathes the principles and ethics and morals that his father taught him So he's he's extremely close to his father and I can imagine impact he his death had on him So when I asked him if he could talk about the last conversation he had with his father He just said no I can't What that illustrates to me is that Warren Buffett is hugely emotional right beneath the surface He's able to keep his emotions out of business, but just beneath the surface He's a very human very emotional guy and I think showed some of that in this in this film The documentaries you've made before this have largely focused on political figures in US politics What got you interested in making a documentary about Warren Buffett? Well, I think same large F that many presidents have and and or social activist FAF that we've covered in the past I was just struck by the human story and I'm not a finance guy when I don't know much about finance But I was intrigued how could how could how could he grow up to become who he became? so we really based the film on Exploring his childhood and and and the changes he he forced himself to undergo to become who he became and you know like these other characters We've we've covered in the past, you know, he has a and heroic story in a way It's a I find it very moving when somebody can change who they are and Warren has changed to he is a few times And as we've grown with the times he's a very different man now Carol Loomis from fortune actually said you know She was lucky enough to be with Warren when he was becoming Warren Buffett That's where we got the title for from and and she said he's a just a much bigger and better man than he was before Well one of the ways that it seems like he has not changed though is his attraction to numbers which right out of the gate Just as a kid he was drawn to numbers and as a businessman in his 20s and 30s and really finding his footing as an investor He was a numbers geek at a time when it was a lot harder to be a numbers geek you had to do a lot more work There's a lot more reading there's a lot more work just with a pencil and a pad of paper It's much easier now when you can get an excel spreadsheet and let the computer do the work But but it appears as though that attraction to numbers and literally shutting the door to his office So he can just sit and read and focus that appears to have not changed at all That's not changed a bit. It's on how he said to me My father's like a computer is mine's like a computer But the hard drive never runs out and Warren Warren reads constantly and and keeps adding data to his brain And I asked him what I said I know you kind of think in terms of numbers.
What does it look like to you in your brain? What are you seeing? What are you visualizing that the rest of us aren't and he didn't have an answer for that? But clearly he's seen something very clear and When I shortly before we aired in the film at the premiere in New York last week I sent it to Warren to look at beforehand and he spotted that on one of the charts I had left three zeros off of the total value of Berkshire halfway So we had we had this type of it and there were a lot of zeros in it and it looked pretty pretty zeroed out to me But Warren, you know his eye went right to that and it was the only comedy made so he's he's skilled at looking at numbers What leads him to decide I'm giving away my money 99% of it and I'm gonna give it to the Gates Foundation It's going to some other foundations as well But largely it is going to bill and Melinda Gates for them to spread out across the world what leads to that decision?
I think it was for many many years. It was it was a rational planning process that he went So he formed a foundation in the 60s. He always intended to have his money go back to society He fought with his wife Susie about when to do that. She wanted to give it away sooner He wanted to keep hold of it longer so it could compound and make an even bigger impact and when Susie died unexpectedly all his plans were were were were extinguished and he thought what am I gonna?
that what am I gonna do now and he came up with what he thinks is the perfect solution which is to turn to his great close friend Bill Gates who thinks a lot like he does and One of the best people alive to giving who knows how to give away money So Warren Warren wanted to continue to make money and turn to somebody who he could trust to give it away And I think the catalyst was with the death of Susie because one year afterwards he made the announcement It really does seem like their partnership even even though they remained married for many years They were living apart for decades But there was something connecting the two of them that enables him to continue to grow emotionally It really seems like that is the catalyst that leads him to Bill Gates He's completely and you know when Susie got mouth cancer and in San Francisco and Warren who doesn't To the most part he sticks to his routine, but he got out of the plane and every week spent the weekend with her as she recuperated He he he learned how to how to be there for her and how to just kind of fit and hold her hand and and comfort her So that that that same Warren wouldn't have done that 40 years ago He did that's a new and very different Warren and I think it's a sweet end to a love story And I do see this film as a love story more than a business film It's just a sweet way to see how much he changed and how much he had grown Last question then I'll let you go one of the things that his daughter Susie mentions About her father and she's she's the oldest of the three kids Yes, one of the things that she mentions is him singing to her and singing in particular the song somewhere over the rainbow The closing credits of your documentary Include Warren Buffett singing somewhere over the rainbow. Where did that recording come from because that couldn't have been stuck in a closet somewhere It was so he told that story and when we got into the editing process I Told her we were gonna use the story and by any chance it had Warren ever recorded it and she said you know He'd one thing it to me in a karaoke bar and and we had and we did we did make an audio tape But it was decades ago and I'd have to look for it And I said that would be very important to us You could find that so she dug through her stuff one weekend and came upon it and once we heard it We knew it was the way to end the film now. We know what is karaoke song is that right? The new documentary becoming Warren Buffett premieres on HBO on Monday January 30th at 10 p.m It's fantastic.
So watch it Peter coon heart. Thank you so much. Thank you Coming up next we'll give you the inside look at the stocks on our radar This is my little money as always people in the program the interest in stocks They talk about in the money for me a formal recommendations for against so don't buy your self-stox based solely on what you're here Welcome back to my little money Chris Hill here in studio with Jason Moser Jeff Fisher and Ron gross You can check out past episodes of money and all of our podcast just go to podcast dot fool dot com and while you're there You can test drive rule breakers, which is David Gardner's growth stock service The latest issue is out with two new stock recommendations from David Gardner and his team You can check it out by going to podcast dot fool dot com and just scroll down to the bottom of the page for more details All right, let's get to the stocks on our radar. We'll bring in our man Steve right up from the other side of the glass You with a question run gross you're up first.
I've got Verizon VZ Stock dipped on not a great earnings report recently and stocks off 8% this year But I actually think that's a good entry point for this stock with a 4.7% yield trading only at 15 times earnings I in my mind clearly the leader both from a technology perspective as well as a subscriber perspective and even though there is a price We're going on and they've had some drag in their subscriber editions I think this is a good stock tone for the long term Steve right up question about Verizon sure Do you think Verizon has the best coverage in the country right now you hear that all the time there's a Verizon wireless? Yeah, if you watch the commercials, they'll all say that they're within 1% of each other at this point But I believe that the coverage of Verizon is superior. Yes Jason most are what you looking at this week sure Amazon earnings are coming out next Thursday February 2nd ticker is AMZ in we talked a lot about how tough of a holiday Quarter's been for a lot of retail I can't help but wonder if Amazon's been part of the reason why I'd be so I'll be very interested to see how that shakes out for them Echo has seemed to really be the buzz lately, especially around the consumer electronics show They continue to build that functionality on that thing They're planning to hire a hundred thousand employees in the coming 18 months building a new film in center in Colorado I think the bare-side of this one's argue the cost I think that's kind of just not the right way to look at it I mean Amazon is skating to where the puck is going in some cases seems like the only ones on the ice Steve question about Amazon How big a role does Amazon Web Services play in your predictions of the future? Well, I think Amazon Web Services We've seen estimates that can be in from a hundred to a two hundred billion dollar business when it's all said and done But the attractive part right now is they continue to build it out it brings in 30% or so operating margins And so it'll continue to be a growing very profitable side of the business Jeff Fisher, what are you looking at this week?
Whirlpool ticker ticker ticker ticker ticker ticker ticker ticker is WHR It's the largest home appliance maker in the country and the stock fell more than 10% this week after earnings came in a bit Because of Britain we're seeing actually actually an effective brexit hitting business over there and the weak pound as well But what I like about Whirlpool as well is almost everything that it sells in the US Whether it's Maytag or KitchenAid or Jenner it makes most of it in the US as well So it's a manufacturer that's wherever it's selling is typically locally manufactured as well Steve question about Whirlpool How do you select an appliance or your mind refrigerator? What are you looking for? It's great question Steve I go to reviews I actually would pay up for consumer reports and get in-depth reviews when I buy something expensive like that Whirlpool Amazon Verizon 3 well known very different businesses Steve you got one you want to add your watch list? Well, I've got Verizon and Amazon's I may throw Whirlpool in there Alright, so I think you'll be happy with your choice Steve Have you bought any big appliances recently Steve?
Unfortunately yes What'd you get? What'd you get? A fridge we bought a dishwasher You sound really happy with those first Did you get some automatic water dispenser in the fridge? Yeah you bet Nice Can you even make them without their do yes Ryan Gross, Jason Moser, Jeff Fisher, guys thanks for being here Thanks Chris That's going to do it for this week's edition of Motleyful Money, our engineer is Steve Broido, our producer is Mac Greer I'm Chris Hill, thanks for listening, we'll see you next week