Motley Fool Hidden Gems Investing - 27 Stocks for 2023

Episode Date: December 30, 2022

CEOs on the hot seat, stocks in the spotlight, and reckless predictions! (0:21) Jason Moser and Matt Argersinger discuss: - Industries and trends investors should be watching - Why the CEOs of Amazon, Starbucks, and Twilio could be on the hot seat - Two stocks poised for upside - Keeping online streaming and BNPL businesses on a short leash - Not being worried about Blackstone, Home Depot, and Johnson & Johnson (19:11) Jason and Matt continue our 2023 preview with: - Potential surprises for investors - Why Live Nation and nCino could both be acquired - 1 trend and 1 stock that investors will have to be very patient with - Reckless business predictions involving crypto, Elon Musk, and Warren Buffett - Two stocks on their radar: Topgolf Callaway and Easterly Government Properties Want even more stock ideas? Get a free copy of our "5 Stocks Under $49" report by going to www.fool.com/report. Stocks discussed: ROKU, GOOGL, PARA, DIS, NFLX, AMZN, TWLO, SBUX, STAG, TTD, WBD, PYPL, SQ, BX, HD, JNJ, CRM, PLD, CRWD, STWD, LYV, NCNO, APPH, COIN, BRK.A, MODG, DEA Host: Chris Hill Guests: Jason Moser, Matt Argersinger Engineer: Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

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Motley Fool Money starts now. Everybody needs money. That's why they call it money. The best things in life are free. But you can give them to the birds and bees. Chris Hill. From Fool Global Headquarters, this is Motley Fool Money. It's the Motley Fool Money radio show. I'm Chris Hill. Joining me in studio, Motley Fool Senior Analyst Jason Moser and Matt Argersinger. Good to see you as always, gentlemen.

Hey, Chris. It is our 2023 preview. We've got stocks to watch, stocks to avoid, CEOs on the hot seat, and of course, as we do every year, we're going to make a few reckless predictions. But Matt, let's go wide to start with, what is an industry that investors should be watching in the new year? I'm going to be a bit of a homer on this one, Chris, because you know I like real estate. But I think REITs, real estate investment trusts in general, are one area the market investors really need to pay attention to. They're trading at huge discounts to their net asset values as a whole. REITs tend to do quite well during inflationary times and

periods of higher interest rates. That might not seem apparent right now because a lot of them are really beaten down. That's really the point. I'm seeing some of the best valuations and years, you can find a slew of very strong REITs paying 5% plus dividends. Maybe that doesn't sound very good in a time when risk-free treasuries are trading at 4% yields and you can get those and not have to worry about any risk. But with REITs, you also get growth, you get earnings power, you get assets. These are companies that are growing their net operating income, growing their dividends over time. I think if you look back, late 2022, early 2023, I think this is going to be a great time to pick up REITs and build a sustainable

growing income stream for your portfolio. After the stock market we just went through over the past year, 5% growth sounds phenomenal to me. Jason, what about you? What's an industry you think folks should be watching? I think it's going to be very interesting to see how the retail consumer discretionary market shakes out here. I think we've got a year coming up here where rates should remain materially higher. The prospects for any additional stimulus are pretty much off the table now. We've seen the downside of that. The consumer is just finding themselves in a bit of a tougher spot now. I've talked about this data before, but the personal savings rate now at just 2.3%. You got to go all the way back to July

of 2005 when it was lower. Credit card balances set to cross over $1 trillion for the first time ever. More Americans now than ever before are living paycheck to paycheck. 60% today versus 56% a year ago. I think this is just going to force consumers to be a bit more thoughtful about how they spend their money. I think it's going to create some winners and losers in the consumer discretionary and greater retail space. The thing about retail is, not the full report card, but we're going to get some early indications, late January, early February, as some of the major retailers start to share how they did over the holidays. Yeah. It does feel like while consumers

are spending, they're starting to get tapped out. I think we're going to probably see some modest numbers for this holiday season, not too good, not too bad, kind of a Goldilocks thing. But yeah, going forward for 2023, at least at the front half, it feels like consumers are going to be in recovery mode. Let's move on to trends. Matt, what's a trend that you're excited about this year? I think this is one, and of course, I guess we can talk about the pandemic as well. But the idea of reshoring, onshoring, bringing a lot of manufacturing back to the U.S., there is a real thing of moving from what was the just-in-time manufacturing of recent decades to just-in-case manufacturing.

And we got to a situation post-pandemic where we were dealing with all these supply chain pressures, inventory problems, logistical issues. And I think there's a greater sense among companies in the United States that manufacture that, we need to bring some of that back home. We need to bring some of that back to the U.S. There was a recent survey by Thomas Company that surveyed 709 manufacturers, and 83% of them said they were either likely or very likely to bring some of their manufacturing back to the U.S. I think that's a big trend. I think the Taiwan semiconductor plant that they're building out in North Phoenix, the major investment they're making there, that's a foreign company, but that's a good poster

child for what this trend could be like in the years to come. If even just 5% or 10% of the manufacturing that was outsourced in the previous decade comes back, you're talking massive job growth, massive investment in the country. It was the pandemic and it was also early in 2022 with Russia's invasion of Ukraine. As you indicated, there are a lot of companies that were figuring out where they were getting all their different parts from. That's right. That's another big catalyst, I think. What about you, Jason? A trend you're excited about? Yeah, keeping my eye on connected TV,

right, the CTV we talk a lot about here, the advertising that comes with it. For example, the company that really benefits from this is The Trade Desk. You have to search through their analyst day transcript from October, and just the term CTV was mentioned 89 times. It's just a big driver for their business, and it's accelerating. You see, most of the big traditional media companies noted back at the beginning of 2020 that they felt like they had time. There's going to be a seven-year process in seeing us flipping away from the cable model and more towards connected TV. They were preparing their investments accordingly. But what we're seeing now is this has really accelerated more quickly than they even estimated.

Ultimately, they view this as something that they have less than three years really to make this transition fully to adopting that connected TV strategy. When you look at the past versus the future, before you had Roku, Hulu, and YouTube, which made up 46% of U.S. connected TV ad market in 2020. Now, that's down to about 33%. It's not because they're losing business because of poor performance, it's because we have more players in the space now than ever before. You've got Peacock, Paramount+, Netflix diving in, Disney+, Amazon, among others. You see this over-the-top ad spend market. It's poised to grow from $6.3 billion this year to just over $11 billion by 2024. A lot of money being spent in this connected TV market, for sure. I think that's one that

investors ought to keep an eye on. You look at the early data that we've gotten out of Netflix and their initial foray into the ad tier, it's starting off slowly, but maybe that gives them something to build on. I think so. Honestly, I'm not surprised at all by that. They really put this thing out there very quickly. We always refer to Reed Hastings as the smartest guy in the room when it comes to streaming, but this is a reactive move for them to incorporate an advertising tier. Maybe he's not the smartest guy in the room when it comes to actually building an ad-supported platform, but he's still a really smart guy. I think that you give him a little time, they'll roll this out, it'll be very

effective and a nice contributor to their business. Every year we see CEOs leave, either of their own accord or they're pushed out. When you think about 2023, Matt, who's the CEO whose seat is getting warmer? Definitely getting warmer, not hot, but getting warmer, Andy Jassy, CEO of Amazon. This is a little unfair. Guy's only been in the seat for about 18 months. But if you think about some of the great leadership handoffs in history, and I'm talking, you're going from a legendary iconic CEO, maybe a founder, giving the reins to someone else, it generally doesn't go well. I'm thinking back to Jack Welch, to Jeff Immelt, Bill Gates to Steve Ballmer, Howard Schultz to literally anyone at Starbucks, and unfair,

but most recently, Bob Iger to Bob Shepak. I think the only one in recent history that's worked out in my mind is Steve Jobs to Tim Cook, which I think everyone agrees is a huge success. Matt Greer would push back on Craig Jelinek. He's been quite an effective CEO for Costco taking over for Senegal. That was a while back, though. That's a good one, too. Anyway, it is hard to find good examples. I think that automatically puts pressure on Jassy. But remember, he's coming from AWS, and he does a spectacular job there. But now he's trying to right-size this massive retail operation at Amazon. I just think, how much of a leash are shareholders going to give him? The stock's down quite

a bit since he took over. Kudos to Jeff Bezos for getting out near the top, just like Bob Iger did a couple of years ago. But I think it's a big challenge for him, and it may not go as easy as people think. What about you, Jason? Have you ever noticed that Jassy sounds like Bezos? Their voice, their intonations, their everything. If you just close your eyes and listen to an interview with Andy Jassy, and then listen to an interview with Jeff Bezos, just close your eyes, you listen, they really sound alike. Does Jassy have the maniacal laugh to. That's what he needs. That's what he's missing.

That's what he's missing. Otherwise, it's really interesting. Maybe that's just because they worked so closely together for so long. I think, like Matty, I don't know that this is necessarily a hot seat, but it is getting warmer. Jeff Lawson at Twilio. Twilio is a good business in the suite of offerings that it has, but now is the time for them to focus on making some actual money. The clock is ticking. Investors are ready. It was a key narrative of their investor day in November. One thing they can do to help this cause, bring that stock-based compensation down. That's something that we see with a lot of these tech businesses that come to the market so quickly. You've got to attract a capable

workforce and stock-based compensation is a way to do that. But they have committed to bringing that down. They have committed to delivering full-year non-GAAP operating profitability starting in 2023, and that's the next step. I think investors will view this business a little bit differently once they hit that target, but they got to hit that target. It's one thing to say it, it's another thing to do it. If we see signs that this isn't going to happen, Lawson is going to have some serious questions to answer. He's protected with the dual-class share structure, but that doesn't stop those questions from coming in that seat from getting warmer. Matty made the joke about Howard Schultz

Starbucks. But let me just suggest that I actually think that Schultz, as the interim CEO, is actually on the hot seat for the first three months of 2023 because Laxman Narasimhan takes over on April 1st as the CEO, and I think Schultz needs to hand him the keys to the corner office, take a bow, get off the stage, and disappear forever. If he doesn't do that, it's just causing problems for the next guy. That's probably right. Up next, a few stocks with upside potential and a few stocks with the opposite. Stay right here. You're listening to Motley Fool Money. Welcome back to Motley Fool Money. Chris Hill here in studio with Matt Argersinger and Jason Moser.

It is our 2023 preview. Matt, what is a stock or industry that you think is poised for upside in 2023. I mentioned Andy Jassy a little while ago. He had a warning about excess capacity in the warehouse space and Amazon's warehouse space back in the spring, which really cast a shadow over the warehouse real estate industry. All the REITs in that space have been down 40%, 50% since he made that proclamation. I think investors read too much into that. I think we still have a dire need of more warehouse and fulfillment space in the U.S. in particular. e-commerce is still going to take retail market share over time. More and more companies are adopting omnichannel sales approaches to their businesses. If I'm right at all about that

reshoring-onshoring trend, we're going to need more manufacturing and warehouse space in this country. If I look at companies like Prologis, the biggest industrial REIT, Easterly Government Properties, one I like a lot, Stagg Industrial, I think those are all industrial REITs that are poised to do really, really well in the years to come. Jason, what about you? Well, yeah, continuing on with my excitement about connected TV, I think the Trade Desk is poised for a better year this year. I mean, like many stocks, it's down around 50% this year. You'd hate to think it's going to be a worse year. Yeah, I hope not. I mean, the nice thing about Trade Desk is, it's a profitable

business, right? I mean, it makes money. They've crossed that hurdle and left it in the rear view. I mean, they continue to invest in the business, but it generates cash, it makes And so, it's a little bit less of a speculative type of investment. But again, you look at the tailwinds forming in connected TV and you look at the role that the Trade Desk plays in it. I mean, they'll be working very closely with Disney on its offering. Calling for around $490 million or better for this final quarter of the year, that would peg them at around $1.5 billion in revenue for the full year, up from just under $1.2 billion a year ago. leadership in co-founder Jeff Green. It's a business that I own personally in my portfolio.

It just feels like whenever you think of the Tailwinds and connected TV, one of the first companies that comes to my mind is the Trade Desk. Matt, what is a stock or an industry either to avoid or at a minimum keep on a very short leash? I don't think this is pushing back on Jason's connected TV idea because I think the advertising interplay is different than what I'm talking about. But he said it earlier with so many new players in the space. I mean, if you go back 10 years ago with streaming TV, I think you had Netflix and HBO, and then you had all these nascent emerging players. Well, now you have Prime Video, which is huge. Jason mentioned

Peacock, Paramount+, Disney+, Apple, Hulu, YouTube TV, which I think just is going to bid $2 billion to $3 billion to get the NFL Sunday ticket, as far as we know. But I just feel like there's so many competitors now, so many choices, only so many hours in the day for someone to consume all this amazing content that's being made. Meanwhile, that content is becoming more and more expensive to make, especially the live TV stuff like the sports. I just worry that the industry players themselves might be heading to a marginal profit of zero over time, unless there's consolidation, unless there's a change. Right now, I think there's just too many players. The consumer is getting to the point where it's like, wait a second,

I've got five or six of these things. I only really watch one or two. What am I doing paying for all this stuff? Well, and we've seen in 2022, we've seen CEOs, you look at David Zasloff at Warner Brothers Discovery, just talking about the cost of content. And in some cases just saying, no, I'm not writing these checks for everything for the rest of time. Bob Iger has hinted as much at Disney as well. So if you think about sort of larger companies like that, it makes it even tougher for the Paramount Pluses of the world. Right. I think it's been an amazing time. As a consumer of entertainment, I just think it's going to be a tough time for the entertainment companies themselves. Jason, what are you keeping on a

short leash or avoiding altogether? Well, Chris, you know how I feel about Buy Now, Pay Later. Not a big fan. Not the biggest fan in the world. I think there are reasons to be concerned. You go back to just the middle of the year, Klarna, which is one of the bigger players in this space as a pure-play buy-now-pay-later platform, they raised $800 million in new funding at a $6.7 billion valuation. Now, that sounds great until you recognize that the previous year, that valuation stood at $45.6 billion. That is insane to think of. When you look at the other businesses out there that are playing in this space, PayPal building its own homegrown

offering and benefiting from it a little bit. But then you look at something like Block, where Block made that after-pay acquisition $30 billion. The gross merchandise volume for their Buy Now, Pay Later platform was $5.4 billion this most recent quarter. That was up just 10% from a year ago. It just feels like this is a lifeline when you're running out of options, and that's never a good thing. There was a study conducted by researchers at the University of Washington, University of California, Irvine, and the Singapore Management University. They found that buy now, pay later services. Using these services results in more bank overdraft charges, credit card charges, and credit card late fees. All of these ding the consumer.

It's like buy now, default later. Essentially, it's what it's starting to feel like. The scary part is that spending with buy now, pay later platforms with these tools, it's projected to reach $1 trillion by 2025. Man, I just don't feel like that ends well. Just don't. Let's go to the other end of the spectrum, Matt. What is a stock that you're just not worried about? Maybe it's not shooting to the moon, but you're not checking on it every week. No, it's Blackstone for me. It's a stock I've owned for a little bit now. They've been in the news lately for some wrong reasons. They slowed the rate at which investors could withdraw from one of their big funds. That spooked a lot of

investors. You saw Blackstone stock drop quite a bit. This is one of the smartest, best asset managers on the planet with a great track record. This is normal course of business for them. When times get a little distressed, I'm not worried at all about Blackstone. I think they're going to be just fine. Jason, what about you? Home Depot, that's the one that stands out to me. I used 2022 as the year to actually establish my position in Home Depot, bought my retirement portfolio with the intention of holding it hopefully forever. I'd like to be able to pass that one on if possible. But if you go back to our preview show for 2022, the industry or stocks that I was excited

about was home improvement. Interestingly enough, Home Depot and Lowe's have both underperformed this year, underperformed the market. Obviously, it's been a very difficult year. But again, like I said, I use that as an opportunity to build a position in Home Depot. Home improvement space is so resilient, it's very reliable. Housing is just going to be something that underpins our economy for the rest of our days. Home Depot and Lowe's stand to benefit tremendously from that through time. I'll just add in Johnson & Johnson. They actually outperformed the S&P 500 by about 15% in 2022. They're splitting off the consumer business in November. Yeah, not worried at all. Our 2023 preview is going to roll

on after the break, so stay right here. You're listening to Motley Fool Money. I'm doing all right, getting good grades The future's so bright I've got to wear shades I've got to wear shades I've got to wear shades What goes up must come down Spinning wheel, got to go round

Welcome back to Motley Fool Money. Chris Hill here in studio with Jason Moser and Matt Argesinger. It is our 2023 preview, which I'll just point out, we're recording a few days early before the end of the year, so just do us a favor and keep that in mind in case there are any last-minute announcements from any of the companies that we talk about. The way the market has gone in 2022, obviously not fun for us as investors, but it does offer a nice advantage that we have as long-term investors, and that is the fact that there are a lot of great companies out there that are back at levels that they haven't been at in years. Our investing team actually put together a report of five companies that have all fallen

below $49 a share. The report is free. You can get it just by going to fool.com slash report. You just get immediate access to the report, which I will point out creatively is called Five Stocks Under $49. Shout out to whoever named that report. Again, just go to fool.com slash report. Jason, we're going to start with a round of fill-in-the-blank. In 2023, blank is going to surprise a lot of investors. I think that Salesforce is going to surprise a lot of investors in the good way, not the bad way. Chris, let's be glass at full. It sounds like a broken record, but yeah, tough year. Stock is down around 50% this year. We have seen just a mass leadership exodus from

this company recently. Mark Benioff lost his co-CEO, Brett Taylor. I think it was the second co-CEO in three years. Stuart Butterfield from Slack, Tableau President and CEO, Mark Nelson. There's a Bloomberg report that at least a dozen in the company's leadership ranks have announced resignation since October. This just raises a lot of questions as to what really is going on inside the building there. They're starting to feel some heat on margins, investors demanding a little bit more on the profitability side. I think Benioff's up to the task. I think he's taking a lot of this very seriously. It does look like they are assessing the workforce and trying to maybe right-size the business as well.

I think that all will ultimately work out well for shareholders. Very good business, just a very tough year. Matt, it can be a company, a CEO, an industry. What do you think is going to surprise investors? I'm actually going big macro here, Chris. I think inflation is going to surprise a lot of investors, but the opposite way. I think by the second half of 2023, we're actually going to be talking about deflation more than inflation. I think you see a lot of the big headline inflation numbers rolling over now, especially on the commodity side. I think rents are really slowing, housing prices we know are probably going to come down

a little bit. And if we do get an economic downturn, which a lot of people are pointing to, too. We could be in a situation, I think, by the second half where we're in a recession, and the concern is no longer inflation, it's deflation. And who knows at that point, because I never know what they're doing, what the Fed might be doing to interest rates or where the interest rates might be in the economy. But I think there's probably, at this point, because inflation has stuck around a lot longer than we think, that a lot of investors assume that that's going to be the case. We're going to have years of elevated inflation. I think signs point to, it might be the opposite. Well, if it's any solace to you,

No one really knows what they're doing over there. There you go. All right, Jason, this time next year, I think I'm going to regret not owning blank. Probably CrowdStrike. Cybersecurity, for me, is just a tough one to understand fully. Threats are always changing. I fully know that I'm not an expert in this space. As such, I probably won't buy shares of CrowdStrike either, just because it's not a business I'm fully comfortable in understanding. Now, with that said, this is clearly a business that's making waves in the space. I mean, the enterprise clients, I think the stock is having a tough time right

now because enterprise clients are being very thoughtful about their budgets, and they're not spending as much right now. But the business itself, I mean, they combine machine learning and AI and behavioral analytics, strong leader at the helm. They've got co-founder, CEO George Kurtz. He has a lot of experience in the space. I think that the nature of cybersecurity is such, it's not optional. It is a requirement in this day and age, and that is only going to become more the case as time goes on. You see CrowdStrike obviously having a difficult year. I think that ultimately changes down the road. Again, though, for me to get exposure in that cyberspace, I almost feel like I would just need to buy an ETF and call it a day.

But earlier in the show, we were talking about connected TV and advertising. Pulling back on marketing spend, that's a lever that a lot of businesses across a range of industries are pulling. To your point, cybersecurity, don't cheap out on cybersecurity. What are you doing? You get what you pay for in that case. Matt, what do you think people are going to regret not owning a year from now? Well, I think I'm going to regret probably not owning Prologis. And this is me being silly with stock investing in the sense that I've been waiting for a lower price. I've been anchoring to the $100 stock price on this company. As we're taping, it's like $110. It's the world's

biggest REIT, I think, at this point. It's certainly the world's biggest industrial REIT. For all those things I said earlier about the need for more warehouse space, rents in that space are going to be growing bonkers. It's just such a well-managed company throughout decades. It's been a huge outperformer. For whatever reason, I tend to own the smaller REITs in that space. So, I've neglected Prologis. But I know for a fact, probably a year from now I'll regret not buying Prologis today. One thing that we see as investors in good times, and certainly in recessionary times, is larger businesses buying smaller businesses. So, Jason, in 2023, don't be surprised if blank buys blank.

I would not be surprised at all to see Tama Bravo, the private equity firm, buy Encino, which is the banking software company. Encino, they have software that automates and streamlines complex processes at banks. They utilize data analytics, AI, machine learning, all that stuff to ultimately enable banks and credit unions to onboard clients, make loans, manage the loan lifecycle, open accounts. To me, this seems like a business very much in line with what Bravo is interested in. It wasn't all that long ago they bought Ellie Mae, for example. But you look at Encino, again, tough year, guiding for $400 million revenue this year, now at a $2.8 billion market cap. This is something, I think, that would

be well within Bravo's capability. It would not surprise me at all to see this happen. Nothing to do with The Encino Man, great early-90s comedy movie. So good! Matt, what about you? Yeah, don't be surprised if Blackstone, Starwood, insert your favorite private equity company, buys Live Nation. Live Nation has been in the news lately. They've got their Ticketmaster kind of controversy going on. There's calls to break up the company. They own some really great properties. I could see a private equity company coming in, buying them at a distressed price, spinning off Ticketmaster, and then owning those great assets and that performance

business. It's one company I've been looking at to buy, but I feel like there's a lot of controversy around it right now, but not too much for a larger company to come in and probably take out. Yeah, they put those TayTay fans on full tilt. I was just going to say, you don't want to anger the Taylor Swift fans. That's right. All right, last one, Jason. One thing you're going to have to give some time to is blank. Think of this as maybe a trend or a company, a business that it's like, as you like to say, you're going to have to pack a lunch on this one. Yeah. Well, I'm going to go back, speaking of food, I'm going to go back to our Thanksgiving

show and my slice of humble pie, app harvest and controlled environment agriculture. I think this is absolutely part of our future in our food supply chain. And I think that we have a growing population, limited resources. People care more than ever before about the food that they're eating, and controlled environment agriculture really is one way to help shore up food supply chain issues. It is something that's going to take a long time, though. My mistake in that investment was being way too early to the game. Now, SPACs enabled that. For all of the interesting companies that SPACs have brought to the market, the nature of SPACs means that they're just coming to the market far earlier than they really

probably should. That was one of the big lessons I've learned. Now, I will say, I am still an at-bar of a shareholder, and I continue to hold my shares and will continue to hold my shares, because I've always viewed this as a 10-year investment thesis. It's super long-term investing. But it is something, if investors are interested in controlled environment agriculture, I think it's got a lot of potential, but it's also going to take a long time. Two quick things. This is a stock I own as well. It has gotten knocked down to the point where I look at it now and I wonder, is this a company that two years from now is going to be a standalone public company?

Not because I think it's going to zero, but I think that there's enough there and the stock price is low enough that I'm wondering if someone is going to swoop in and buy them. Yeah, that thought has definitely entered my mind as well. I'm not concerned with them as a going concern. They've locked up a lot of really important funding and some FDA-backed loans as well. They've got the right people on their side. But it is something that strikes me that very well could be an acquisition target. And if that's the case, well, so it goes. And the second thing, after a year like 2022, I as an investor, I don't think I'm alone in looking for silver linings. Am I wrong in thinking that a silver lining is that SPACs

as an idea, have really been pushed to the back burner. I think, at least over the next couple of years, we're just going to see a lot fewer companies going public via SPAC. Yeah, I think that's fair. We're out of that free money environment now. SPACs, very interesting opportunities, but clearly have underperformed in a major way. I think that just all goes back to the nature of SPACs. You just get these companies far too early in their development, They're not established yet. The contrarian in me does think, though, that the industry is so maligned right now. SPACs going forward now, there might be some opportunities there. Matt, one thing you're going to have

to give some time to is blank. Renewable energy. I think we got all excited in recent years, past decade, of what solar technologies, wind power technologies, even fusion now, which has been in the news recently, could do for energy production in the country, in the world. And I just think the reality is, we've learned that these technologies are fantastic, but they're highly capital-intensive, they're not very efficient yet still. Our power grid, our transportation systems, logistics systems are going to rely on fossil fuels probably for the majority of their power generation for many years still. And so, as excited as were about these technologies and what they could do for the environment and for the economy,

I think that's one of those areas where we have to step back and say, well, the reality is, hey, oil and gas, I hate to say it, here to stay, probably for a lot longer than we think. Some business shows err on the side of caution, but not us. After the break, we've got our reckless predictions for 2023. Stay right here. This is Motley Fool Money. As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. Welcome back to Motley Fool Money. Chris Hill here in studio with Jason Moser and Matt Argersinger. We're wrapping up our preview for

2023. Reckless prediction time, Jason. We got two categories this year, one for business, one for non-business. What is your reckless business slash investing prediction for 2023? Well, I think that Elon Musk will abide by the poll and actually step down as Twitter CEO. Maybe that's not so reckless, but Chris, you know who is going to be the CEO of Twitter when he does step down? Do tell. Sheryl Sandberg. Really? There you go. She's going to leave Meta Platforms. She's already gone. She left Meta. Oh, that's right. Yeah.

With experience with Google, her experience with Meta, Musk has tried to poach her before. He tried to poach her, actually, while she was working at Meta for Tesla. I think he might get her. Matt? This is not me. I don't want to offend any of the crypto fans out there. Oh, my goodness. Here come the emails. Oh, here we go. But I do think there's a small but realistic chance that Coinbase Global goes to zero. It's not because I hate Bitcoin or cryptocurrencies, I kind of do, but it's really because if you look at their business, the vast majority of their revenue comes from retail investors trading cryptocurrencies,

where they earn nice commissions and spreads from that trading. Fidelity is either just launchers in the process of launching a crypto trading platform with zero commissions, very low spreads. And I just have this feeling that it doesn't really matter what happens to cryptocurrency prices. The fact is that there's going to be less trading and that that trading is going to get a lot cheaper, presents a serious problem for Coinbase, which is still, believe it or not, a $10 billion market cap company. I just think they're headed for a world of pain in 2023. I don't know if they'll go to zero, but I see a lot lower stock price there. I believe this was Ron Gross' reckless

prediction on last year's show. But this time, it's actually going to happen. Berkshire Hathaway in 2023, is going to announce that Warren Buffett is stepping down as CEO. He will stay on as chairman. And because it is Berkshire Hathaway, they will make this announcement in an SEC filing. Just an AK, that's it. That's it. The non-business investing category reckless prediction, Jason, what do you got? Well, Chris, money talks, as we all know. And I think in 2023, we will indeed get confirmation that a sequel to Top Gun Maverick is in the works officially, but it gets better. Because this sequel is going to star either, or possibly both, Bob Odenkirk and or Bryan Cranston.

I mean, those two guys make everything better. I know, I know. Now, I'd go see that one. Yes. I'd go see that one. I think shareholders of Paramount Plus would be thrilled with that. Matt, what do you have for the non-business investing category? So, I think there's going to be a major sports betting scandal that's going to lead to insider trading rules for sports gambling. And bear with me on this, but if you think about how big the sports gambling industry has gotten, how easy it is, and the millions and tens of billions of dollars that are now involved in it. So, just imagine you're an assistant coach on the Kansas

City Chiefs. You learn that Patrick Mahomes, during the week of practice, sprains his ankle. All of a sudden, you know that he's hobbled. He's probably not going to rush for the overnight around the 40 yards that he was supposed to do in this coming game. You pass along to some friends, they bet on that. I just think the industry, the way it's evolving, presents some serious challenges to insider knowledge. And we might get some regulation, just like the SEC regulates stock trading. For team executives? But you didn't have to extend beyond that. But yes, certainly, at least for team executives. Fascinating. All right, let's get to

the stocks on our radar. Our man behind the glass, Rick Engdahl, is going to hit you with a question. Jason Moser, you're up first. What are you looking at? One that I've been talking a little bit about recently with Emily is Topgolf Callaway Brands, ticker MODG. Given my work history in golf, I've always been a bit hesitant to invest in golf because I know how expensive it is, how hard it is, and how a lot of people try it out, they suck at it, and then they promptly quit. It's always been a challenge from an investing perspective. But given the new name here, Topgolf Callaway Brands, you can see that they acquired Topgolf, which I think opens up a new audience to the game

of golf. It gamifies it, it's a social thing as opposed to going out there and playing 18 or 9 holes or whatever. I think it just opens them up to a new audience. It brings in food and beverage revenue as well. I also think it's pretty neat they have this Golf plus virtual reality experience. So, it's something that I'm digging into for the augmented reality service. And the ticker? MODG. Yeah, you couldn't talk me into 18 holes of golf, but you could talk me into a trip to Topgolf. I'd do that with you. That's fun. Rick Engdahl, question about Topgolf Callaway.

I tried golf and I sucked at it, so I quit. And so, what's in it for me? Well, you need to go to Topgolf. I think that will change your view on things. Essentially, it's like bowling for golf. You can suck at it and still have a lot of fun. Also, food and beverage. Matt Argersinger, what are you looking at? Put this stock in the one that I just think is stupid cheap. Easterly Government Properties, ticker DEA. This is a REIT. Now, it's an office REIT, but they lease exclusively to federal agencies like the DEA, FBI, FDA, VA. Essentially, you have a 7.5% dividend yield, essentially guaranteed by the federal government, because that's who pays the rent

to the Eastern League government. It's a business that's growing because the GSA, which manages most of the government's real estate, is slowly going to a leasing model instead of an owning model. I just don't understand why this company is so cheap, trading for 7.5% yield. I own shares, and I think I want to buy more. Rick, question about easterly government properties? I'm sorry, I nodded off for a second. That's right. That's what you should do if you own easterly government properties. Well, alright then. I guess I'm in good shape. How'd they get the ticker symbol DEA? Well, I don't know how they got it,

but it's certainly appropriate. It absolutely is. Rick, you got a stock you want to add to your watch list? Not really, no. Not really? You couldn't be talked into food and beverage and a round of Topgolf? No. Well, I guess so, sure. For the watch list, well, now you sold it. I caused him to fall asleep, it's my fault. I knew he was allowed to pull there. I know if someone's going to be buying the beers, it better be you because you got good taste. Well, thank you very much, I appreciate that. I think it also says something about the golf industry that given your experience

working in it, you're like, yeah, this is not necessarily a great place to invest. It's a tough one. It's like grills. I love my Traeger, but I'm not buying that stock. Jason Moser, Matt Argersinger, guys, thanks so much for being here. Thank you. Thanks, Chris. That is going to do it for this week's Motley Fool Money radio show. You can drop us an e-mail, podcasts at fool.com. That's podcasts at fool.com. The show is mixed by Rick Engdahl. I'm Chris Hill. Thanks for listening. We'll see you next time.