Motley Fool Hidden Gems Investing - Apple, Amazon, and 2 New All-Time Highs

Episode Date: October 28, 2022

The biggest tech companies reported this week, but it was Apple that shined the brightest. (0:30) Jason Moser and Matt Argersinger discuss: - The diversity and strength of Apple's business lines - Slowing growth in Amazon Web Services - Meta Platforms hitting its lowest point in 6 years - Ford Motor's demonstration of fiscal discipline - The latest from Alphabet, Microsoft, and Visa (19:15) Jason and Matt continue the earnings analysis and discuss: - ExxonMobil and McDonald's hitting new highs - Chipotle's plans for growth - Surprisingly strong weeks for Teladoc Health and Intel - Overrated and underrated Halloween candy - Two stocks on their radar: SiTime Corp. and Lennox International Got a question about investing? Email [e-mail] Stocks mentioned: AAPL, AMZN, META, GOOG, GOOGL, V, MSFT, F, XOM, TDOC, INTC, CMG, MCD, LII, SITM, TSM Host: Chris Hill Guests: Matt Argersinger, Jason Moser Engineer: Dan Boyd Learn more about your ad choices. Visit megaphone.fm/adchoices

This family is on the brink of civil war. On September 18th, Mobland, the hit original series, is back on Paramount+. We are the Hartigans. Don't know them yet? Then Google us. From the underworld of Guy Ritchie. Do you want to step up the ladder?

I want Comet dead. Starring Tom Hardy, Pierce Brosnan, and Helen Mirren. Do I have to do everything myself? You want more? I'll give you more! Mobland, new season hits September 18th Paramount Plus. The biggest names in tech reported this week, and tis the season for hot takes on Halloween candy. We got thoughts on all that and a lot more. Motley Fool Money starts

now. Everybody needs money. That's why they call it money. 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. It's earningspalooza. We've got the latest on some of the most widely held companies. And as always, we've got a couple of stocks on our radar. But we begin with Apple. The biggest tech companies in the world reported earnings this week, but the reaction to Apple's report was different than the rest. Shares up more than 7% on Friday after fourth quarter profits and revenue came in higher than expected. Jason, a little

surprising when you consider how important the iPhone is to Apple's business, and iPhone revenue was more than half a billion dollars lower than expected. Yeah, but Apple's like pizza. Even when it's bad or it's not that great, it's still pizza. Same thing with Apple, it's still Apple. Did they blow the doors off the quarter? Nope. But it was still a pretty Apple-like quarter. Even if they underperformed anywhere in regard expectations, it was still a respectable quarter. Phones, services, yeah, they could have done a little bit better. But it's not like these were bad results. They point to a company that ultimately remains pretty darn resilient, even in the face of a tough economic climate

like we're in now. If you look at the numbers, revenue of $90.1 billion was up 8% from a year ago. That includes 600 basis points of currency impact. To put some numbers around the fiscal year. Fiscal 2022, $394 billion in revenue, 8% annual growth. Services performed well, but probably not well enough in some eyes, $19.2 billion vs. $18.3 billion a year ago. So, 5% growth. For a company we've been talking about, this is becoming a services company, that's not all that inspiring. But the flip side of that is, they've got more than 900 million paid subscriptions across the services on their platform. That's up more than $155 million over the last 12 months alone, a double what they had three years ago. So, they are pulling

it off. I think they're just going to have to execute a little bit on the pricing side. And we're seeing that with music and streaming. They're going to raise prices in music. That's primarily due to licensing costs. They're going to raise prices on streaming because they feel like it's a better offering now and they can do it. Mac sales up 25%. iPad revenue was down 13%. Nothing terribly surprising there. Wearables, home, accessories, that was up 10%. I think all things considered, again, didn't blow the doors off the quarter, but a very respectable quarter, particularly when you compare it to the other big tech names that we'll talk about. I think Apple's always going to benefit

from the power users of Apple, the people that will buy the new iPhone, the new Mac, at least every two years. I'm just wondering, to get your thought, if we do enter a slowdown of recession, consumer-driven or not, will their sales fall off just because people might delay buying that next iPhone or that next iPad? Maybe it does to an extent. I think a pretty common theme we're seeing this earnings season, thus far at least, is that current economic conditions and any potential recession that comes down the pike here, it seems to be impacting the lower-income earners as opposed to the higher-end income earners. Apple certainly benefits from that higher spender, that higher earner. It may delay, but I think ultimately

that's a timing thing. If it does that, then you probably look at that as an opportunity to buy the stock. Amazon's third quarter results showed slowing growth in the AWS division, and the company lowered guidance for the all-important holiday quarter. Shares of Amazon down 10% on Friday. You tell me, Matt, how bad was this? Well, not great. I think you hit the two main things. It comes down to AWS and guidance. I want to know if I could tell a quick story really quickly, though, before we get to that, which is, July 2020, I owned Amazon for 10-plus years. I had to sell shares first time because I was making a real estate investment, had some other things going on. I had to sell a bunch

of things. I sold half my Amazon stake. I remember I trembled clicking the button to sell those shares because I didn't want to do it. Of course, at that point, the stock had just gone over $3,000 a share pre-split, but $150 post-split today. I was like, I'm going to regret this. I know I am. Of course, over the next year, I watched the stock go to, I think, $180, $185, almost $4,000 pre-split. I was depressed about that. Watching the stock come up, I never thought I would see the stock down on a post-split basis below $100 a share, which it briefly did this week after earnings. I'm excited about that, but I'm also realizing there is something to why it's down, and you hit it. The Amazon Web Services part of this

business has been the crutch. Even though the retail business has held up, and if you look at the retail numbers, they were fine. I think it was up 13% overall, which given the maturity of the business, that e-commerce business is pretty strong. But you see the slowdown in AWS, which is slower growing now than Google and Microsoft's competitors. I think the bigger thing might be that the operating margins of that business have come down quite a bit. If that is the profit engine that is no longer there, or at least it's diminishing to a certain extent, that I think had a lot of investors worried. And then, of course, you said the guidance, looking at growth between 2% and 8%, I believe, on their guidance range over the fourth quarter, that is probably

a lot sharper than investors were expecting. Again, this is the holiday quarter. This is when people expect not just Amazon, but all retailers to really make their bones. Did the range of the guidance surprise you? Because it struck me as wider than typically we hear from Amazon. And I just thought, and not that I fault them for this, but I thought On the low side, there might be a little sandbagging. Probably a little bit. I think Amazon is known for this. They even said that their operating income would be between $0 billion and $4 billion. That's a tremendous range. I would not be surprised at all. I think what you're getting at is if they come in the high

end of those ranges when they actually report. Shares of meta platforms fell to their lowest level since 2016 this week after the company's third quarter report revealed just how much the company is investing in its Metaverse division. Jason, we like it when CEOs communicate clearly. Mark Zuckerberg is being very clear about what he wants the future of Meta platforms to be. He is, indeed. We're going to see how that plays out, certainly. It's not a surprise that there are challenges on the advertising front. At the end of the day, it is cyclical and it goes as the economy goes. When those purse strings tighten, ad budgets tighten with them. But you said it, they're basically doubling down on this metaverse, which right

now is still just a very squishy concept. You have Google with their moonshots, those other bets, as they call them. For Facebook, this metaverse bet is an all-in Pluto shot. It's so far out there that most people just can't see it. That's understandable. I'm not saying that it's a waste of investment dollars. This probably works out in some capacity, but I think it's going to take a while. There are understandable concerns that he's overdoing it, particularly when you look at the core business itself. Revenue was down. If you exclude currency effects, it was up 2%. I think he'd take that. Bottom line, earnings down 49% from a year ago, which is obviously not good. User growth 4% was a positive. Daily

the active is up 3%. But back to the ad market, while impressions were up 17%, price per ad continues to fall down 18%. They are spending a ton of money, though. Capital expenditures $9.5 billion, almost double from a year ago. And guidance across the board not painting a very encouraging picture in the near term. As expenses continue to go up and revenue continues to come down, they repurchased about 32 million shares for the quarter at an average about $203 per share. Given where Facebook's price is today, clearly, that wasn't the wisest use of those dollars. I'm not the biggest fan of this company. I think most people know that. That said, honestly, from here, the stock is probably an opportunity for those

who are able to take that longer view. It is really difficult to disrupt networks of that scale. I think that he will start to moderate those metaverse investments a little bit. But investors should be very prepared for a bumpy ride. Speaking of a slowdown in ad spending, Alphabet's third quarter profits and revenue were lower than expected. Really, with the exception of Google Cloud, it was kind of across the board, Matt. Shares of Alphabet down 7% this week. Right. It's important to remember that, I think, for a lot of these companies, especially in the ad space, the comparables from a year ago were hard. They were going to be hard.

If you look at Google's revenue, for example, in the year-ago third quarter, up 41%. The fact that they have any kind of growth at all over those numbers is pretty impressive. But you're right, there's definitely a slowdown here. I think the biggest thing that stood out to me was just that the advertising revenue for YouTube was down. I didn't follow the guidance, so I don't know if that was expected, but that felt like a little bit of a shock to me. I think that's been such a sticky platform that's always gaining popularity in my mind. But it looks like, and I don't use it, so I don't know, but it looks like TikTok is actually finally making some inroads, taking some market share from that short-form, medium-term

form video. So, I feel like the ad slowdown is comparable. The tough comparables from last year are explainable. I think the YouTube slowdown is the thing to watch here. And gosh, I wish Alphabet just paid a dividend. I mean, you've got all these other things. And I know there's other bets. The one thing I'll say about comparing Meta to Alphabet is that the thing I like about Google's approach is that these other bets are spread around a lot of different areas, where I feel like Mark Zuckerberg and Facebook Meta, it feels

like an all-in bet, where it's not the case for Alphabet. At the same time, I'd rather they clamp down a little bit on that spending and maybe focus on dividends or other things. Let me go back to YouTube for a second, because I think that part of the reaction we saw was not just to the results themselves, but to the fact that earlier this year, Alphabet already pulled the lever with YouTube in terms of original programming, where they said, you know what, we tried this, it's not working, we're just going to pull this. And so, the results we saw from YouTube become slightly more concerning when it's against the backdrop of, oh, they've already cut the original programming.

That's right. That's a really good point. Visa, Microsoft, and a lot more after the break. So, stay right here. You're listening to Motley Fool Money. Welcome back to Motley Fool Money! Chris Hill here in studio with Jason Moser and Matt Argersinger. Visa's fourth quarter profits and revenue came in higher than expected. Visa must have some extra cash laying around, Jason, because they increased their dividend and announced a $12 billion share buyback plan. Well, I'm not complaining as a shareholder. I'll take it. This was another very strong quarter and a good example of why Visa is

worthy as a core fintech holding. It was interesting in the call, there was a lot of recession talk in management. Clearly, they're not planning for a recession in the coming year. Maybe take that optimism with a grain of salt. If a recession does hit, we likely see them reassess the outlook. But I think counter to that is, this is such a valuable network that leverages so many capabilities across the world. Given the tailwinds and the electronic movement of money, maybe they're a little bit more immune than others. But to the numbers, the numbers were really strong. Fourth quarter net revenue up 19% from a year ago. Non-GAAP earnings per share $1.93, up 19%. Total payments for the quarter, total payments volume was

up 10% from a year ago, up 135% versus three years ago. Cross-border, which is an investment Visa and MasterCard, in particular, continue to make. Those volumes are very encouraging, up 49% from a year ago and 130% versus three years ago. And then, new flows, which is, ultimately, it's beyond that consumer-to-business payments that they've always focused on. Broader movement of money around individuals, businesses, governments, that was up over 20% for the quarter. And as you said, they're going to continue buying back stock. They They bought back for the year $11.6 billion in shares at an average price of just over $205. The share count is down 9% since 2017. That's the M.O. with owning this stock.

They're going to continue to buy back those shares, pay a modest dividend. It's a stock that has offered investors some real stability here this year, just down 3.5% versus in the S&Ps around 20%. It's been a good one to own. How much should we read into the fact that Visa doesn't think there's going to be a recession next year? Yeah, again, I think that it's just one of those things that plays into that broader trend of the electronic movement of money. I think they benefit from that. But I would not be surprised if we do hit that recessionary period. You'll likely see management maybe reassess their outlook a little bit.

Microsoft brought in more than $50 billion in revenue in the first quarter, but shares of the software giant down a bit this week after guidance for the current quarter, a little bit lower than Wall Street was hoping for, Matt. Yeah, a lot lower. Maybe I'm surprised at the growth. They're guiding for growth of just 2% in the next quarter. That seems very low to me. This was also, by the way, Microsoft's lowest rate of revenue growth in five years. Good news is, you still have the Azure cloud business growing 35%. It was the one that was trailing Amazon for many years, but it's maintained its growth. It's now growing faster than Amazon's web services.

Standout to me was, does anyone use LinkedIn around here? Because LinkedIn's revenue was up 17%. I'm really surprised at that. The sessions to LinkedIn were up 24%. I remember, Jason, We were working on a million-dollar portfolio back in the day when Microsoft acquired LinkedIn. I just thought, this seems like a real stab in the dark for Microsoft, who missed the whole social networking. This was their chance to get in on that. I think they've done a tremendous job with LinkedIn, even though I don't use it very much. I don't really know many people that do. I'm with you. Every time I log into it, I wonder, why did I just log into this? There has been a lot of job movement

in 2022, so I think that's part of it. But take solace in the fact that you weren't the only ones. There were plenty of people looking at that acquisition back, was it $26 billion? That's my memory. That sounds about right. I remember thinking at the time, are they just bored? Are they just doing it just to see? To your point, Matt, in all seriousness, the way they have consistently monetized it, And it's really just been in, I think, the last couple of years that they've broken that out and highlighted that. But yeah, it is kind of surprising when you look at the run rate on LinkedIn. Yeah, very impressive.

Ford Motor posted a loss in the third quarter, but shares up 8% this week, in part because Ford executives said they're going to stop pouring money into their autonomous driving initiative, Jason. They were very clear about this. We're not doing this anymore. Yeah. Certainly, the future for now is more EV and less AV. I think shareholders have reason to celebrate there. They will continue to invest in the electric vehicle capability that they've developed. They're the No. 2 EV brand in the U.S. now. I think that says a lot. I wouldn't say they've given up fully on autonomy, but management also recognizes it's a far more complex problem than some would have you believe. It requires

more time, capital, capability that would take them away from making sure that they focus on success in the near-term with the things that they do really well, right? Building cars, right? And EVs are a little bit of a more natural extension, I think, at this point. The company's in great fiscal shape with $50 billion in total liquidity. And as they noted in the call, they're going to impair this investment in Argo, which ultimately was that effort at L4 autonomy. And L4, if you remember, that's considered to be fully autonomous driving, although a human driver can still request control, and the car still has a cockpit. And so, they are going to continue to invest in autonomy, but there's going to

be more L2 and L3, which ultimately just brings more human judgment into play there. And I think that makes a lot of sense. I think most of us agree, and I've been very critical of this move towards AVs, because to me, it feels like the technology for the car, I think, is there. But we don't have the infrastructure, we don't have the road system that can handle that at this point. Matty, you said here earlier today in the production meeting, you have to build a city that's geared for that specific technology. Far in the future, I think it makes a little bit more sense, but I really do appreciate that they're going to focus more on EV, more on the automobile. Ratchet back on the autonomy a little bit and move forward.

Right. You can only innovate so much at the car level. You said it. If the infrastructure and the cities and the roads aren't meeting that technology investment, you're never going to be able to do that. And I just say, kudos to Ford, by the way, a company, unlike other companies we've talked about, that decides to cut bait on something that's just not working out. Instead of doubling down. Right. Well, yeah. And also saying, look, we're looking out over the next 10 years, and over the next 10 years, this isn't going to pay off. Right. And maybe let someone else innovate it. And Ford can, of course,

build vehicles into that eventually. After the break, we've got restaurants, more tech, and two dividend aristocrats hitting new all-time highs. Stay right here. You're listening to Motley Fool Money. Chris Hill here in studio with Jason Moser and Matt Argersinger. ExxonMobil's third-quarter profits were not just a record, but at just shy of $20 billion, the energy giant's profits were within shouting distance of Apple's quarterly profits, Matt. Shares of ExxonMobil hitting a new all-time high on Friday. Yeah, all good, right, when oil prices are multi-year highs. That is the business. Kudos to Exxon. Darren Woods, the CEO, I believe

he was on CNBC on Friday. He said, we use lean times, like we had early on in COVID and the months after, to really keep our CapEx programs going, keep exploring, to prepare ourselves for the eventual good times like we have today. If you look at ExxonMobil's history. Yeah, it's an energy giant, but it's also one of the most innovative companies out there. They've always been really great capital allocators. This is just proving the point that if you can survive the boom and bust cycles of the energy space, which ExxonMobil has done very successfully for decades, you can do quite well as an investor. I love this. I'm looking at this chart. We're beating too much on Meta, I get it. But it was like a

A year ago, Meta's stock price, market capitalization, was three times the size of Exxon's. Exxon is now on the verge of being twice the market cap of Meta. And that happened in the space of about a year. So, think about the turnaround there. But, yeah, really impressive results. I saw that they raised their dividend. Again, this is, of course, a longtime dividend payer, dividend aristocrat company. So, you have that as well.

Teladoc Health's loss in the third quarter was smaller than expected. Shares of Teladoc up more than 20% this week, Jason. Is the worst of it over? Well, I don't want to make a call, but it does feel like we may be finally getting past this mess of an acquisition when they decided to buy Livongo a couple of years ago. The good news is, there was no further goodwill impairment this go-round. Maybe we're on the other side of this thing and then get back to focusing on the core business. I think the results were very respectable. Revenue was up 17% from a year ago to $611 million. The biggest driver of that growth continues to be BetterHelp, their direct

consumer mental health brand. That grew over 35% compared to the previous year. I think on that note, too, as much as I hammered them on that Livongo deal, because I do, BetterHelp has grown and scaled so quickly and so effectively. It's working now at a run rate of $1 billion in revenue. Now, think about that for a second. They bought it for $4.5 million back in 2015. So, yeah, Livongo, maybe not so great. So, you're saying it's the opposite of the Livongo acquisition? It's the George Costanza of Livongos. Yeah, it's at least something to remember. They ended the quarter with total U.S. paid members $57.8 million vs. $52.5 million a year ago.

Visit fee only $24.3 million vs. $23.6 million a year ago. Average U.S. revenue per member per month was $2.61. That was up 9% from $2.40 a year ago. Utilization, 22.3%, up from 21% a year ago as well. We're seeing signs that the business is starting to normalize. They talked about pipeline development really taking a turn for the better and in a great position here for the remainder of the year and going into 2023. Getting through some unforced errors in a difficult macro environment, but I still like what they're doing. I don't think any of us believe that a company being acquired is reason enough

to buy shares of a company. That being said, when you look at where Teladoc Health is today, do you think it is an acquisition target? I'm sure there are folks out there that would like to own it, but I think that Teladoc management would much prefer to be able to forge their own paths. I don't suspect we'll see that, but it's an attractive asset. Shares of Intel up 10% on Friday after third quarter profits came in higher than expected. The chipmaker also told investors it plans to reduce costs by up to $10 billion over the next three years. Cost-cutting is often music to Wall Street's ears, Matty. It is, but to me, it's never the panacea to what looks like a pretty steady downtrend

for Intel's business. I mean, I was looking at the results and trying to figure out where the good news is and why investors were expecting much worse. It wasn't as bad as they thought, so the stock's up. This is a business that probably could be more efficient. I think that's a good story. If they can save $3 billion in cost reductions by 2023, maybe $8 billion to $10 billion in cost savings by the end of 2025 is what they're outlining. You also have a dividend, by the way, right now that's yielding over 5%. So, if you're an investor, maybe right now at today's price, there's not a lot that has to go right to really earn a nice return if you have that dividend in place, which they seem like they're going to defend. And if they can bring

some efficiencies out of the business, bring some costs out, and the cycle comes back, if the semi-cycle comes back in a year or two, maybe that works out for Intel. And not to be overly cynical, but this is one of those announcements that a company, any company, not just Intel, can go back to over the next three years. This is something they can point to six, 12 months from now and say, hey, by the way, we made that announcement in late 2022, and so far this year, this is what we've done toward that goal. Right. It's equivalent to sometimes a new CEO comes in and decides to throw the kitchen sink out. We're cutting all these costs. Business is going to be lean, but guess what? We can look

back a year or two from now and say, hey, that's when we made the business more efficient. Look at our margins today. Business has come back. That's probably what's happening with Intel. Chipotle's third quarter profits came in higher than expected, but customer visits fell and shares of the burrito company down a bit this week. Jason, I say this not just as someone who hosts this show, but also as a shareholder, it is fascinating to watch CEO Brian Niccol and his team continue to walk this line of managing inflation while also managing price increases they're passing along to customers. Yeah, they do a very effective job of it. With around 3,100 stores today, management sees an opportunity for this business to get to 7,000

stores in total. Now, if you think that's optimistic, which I do, so let's discount that 20%, that's still around 5,600 stores they could potentially get to, I think likely will. To me, I think that helps make some sense of today's valuation. You get a burrito maker trading at 44X forward earnings, sounds like a lot, but there's a lot of growth to be had there. Hey, man, they make good food. When you look at the numbers, I think that really tells us a lot. Sales were up 14% for the quarter, $2.2 billion. That was driven by a 7.6% comp versus a year ago. The in-store sales grew by 22%. Digital sales represented 37%. If that sounds a little low, it kind of is, but that's a sign that people are getting back

out there. I think that's a good thing. Restaurant-level margin, 25.3%. That was up 180 basis points a year ago. Ultimately, adjusted earnings, $9.51, up 35% from last year. Opened 43 new restaurants, 30 of those with Chipotle. Again, speaking to that convenience, digital ordering, trying to be wherever the consumer wants them to be. They now have 30 million rewards members, up from 24.5 million just a year ago. They continue with modest share repurchases, but ultimately, that just offsets dilution. The balance sheet remains in great shape, over $1.2 billion in cash and equivalents. To your point, they're managing the costs and inflation along with pricing. Yeah, it does continue to create headwinds. They've

seen costs go up 20% over the last two years. They just effectively and just methodically pass through little price increases here and there that customers continue to pay for. And then finally, Chipotle, the tech company. I'm really looking forward to seeing how this chippy thing plays out. Talk about your chip makers. I mean, Chippy's Autonomous Chip Making? This thing, it's a chip-making robot. I'm not talking about IT chips, Matty, I'm talking about those Dip'Em in Salsa chips. I like those chips so much better. The important chips. I think it's just going to be fun to watch this play out. It's a very innovative management team. They try new things. It's

a lot of fun. I'm happy to continue owning these shares. There was a point in time when the growth story for Chipotle involved other cuisines. The shophouse concept, they were, I think, kicking around a burger concept, that kind of thing. Do you get any sense from Brian Niccol that that is something, even on the back burner, that they are considering, or is that completely off their radar? I don't get any sense that he has any interest in it at all. I say that as someone who loved those other efforts. I thought they made some really good food.

There were tremendous offerings. But it's encouraging to see that he really is going to focus on the core concept here. Breakfast? Where are we on breakfast? I've been asking that for years. I know. We're waiting for it for years. But unlike the other concepts where you could find people who would take a bearish outlook and ultimately the company just decided to put those things away, who's bearish on breakfast? Feels like the biggest no-brainer in the history. No-brainers, Chris. Global same-store sales for McDonald's rose 9.5% in the third quarter, helping to push shares to a new all-time high. And Matt, unlike a lot of restaurant chains, including Chipotle,

McDonald's is seeing an increase in customer traffic. Yeah, great results for McDonald's. The one disadvantage that McDonald's has by being such a global company versus a Chipotle, which is still, as far as I know, mostly a North American story, even though their global comp sales are up 9.5% and U.S. comp sales are up 6%. Overall revenue was actually down 5% because you got the stronger dollar, lower traffic in a lot of the international stores. That was affecting them a little bit. Operating profits were actually down 4%, but again, in constant currencies, up 4%. McDonald's is the growing pains of being a very, very large company that scales across

the globe. It's affecting them a little bit. But those things are outside of management's control. I'd say, can't control currencies or what happens in the macro economy. The results are fantastic from an operating basis. Also raised their dividend 10%. A restaurant chain is mature, a brand is mature as McDonald's doing this well. It's really impressive. What about these comments that CEO Chris Kempczynski made on the call about the McRib, where he referred to it as the goat of sandwiches and compared it to Michael Jordan and Tom Brady? Yeah, maybe a stretch, a tad stretch. I mean, I've actually never had the McRib, so I can't speak to its religious qualities. Well, to me, there's the question of,

really, this is the greatest sandwich of all time? Also, McDonald's is not in the McRib business, they're in the burger business. So, on another level, I just found it odd that he was essentially just pushing aside all the burgers and just saying, no, this limited-time offer sandwich we roll out once in a great while. That's the greatest of all time." I was like, really? That seems like a bad message to send. It might be. But I can't argue with the results so far. Just like stocks, some Halloween candies are overvalued, while others are flat-out undervalued. After the break, we've got our picks for overrated and underrated Halloween candies, as well as a couple of stocks on our radar. Stay

right here. You're listening to 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. Tis the season, guys. Halloween, just hours away, actually. And as we do every year, let's talk about some overrated and underrated candies, because they're not all fairly rated. Matt, I'll start with you. What is an overrated Halloween candy, in your opinion? Got to be Jolly Ranchers, right?

Right. They're small, they're cheap. People throw them in your bag, they take forever to consume, they make your mouth turn green and blue for hours. And they're not chocolate. No, they're not chocolate. And I have to sit there and suck on one for an hour before I get to my next piece of candy, which is kind of inconvenient. You know what, man? I understand where you're coming from, because it's a very polarizing candy, but it's a true story. I made a New Year's resolution one year, several years back to my wife to stop eating Jolly Ranchers because I couldn't stop. I had like a bowl of

those things. I'd throw 20 of them in there during a day because they're so fruity and delightful. Yeah, but unsatisfying, so you have to keep eating. You're right. And that's why ultimately I made that resolution. And I will say, I fulfilled that resolution. And now my hankering for Jolly Ranchers is almost non-existent. On some level, were you telling yourself you were eating fruit? You were eating something healthy? No. Well, there's vitamin C, maybe. No, I think I was just in denial that I had a problem.

What do you think is overrated? For me, this one came right to top of mind, Twizzlers. When I see the commercial, even, I'm like, what the heck? I don't get it. It's like chewing on a shoe. I don't care what flavor, whether it's licorice or strawberry or cherry, whatever, I don't get the attraction to Twizzlers. You find them in those variety bags, you just throw them away. They're no good. My parents-in-law love Twizzlers. they accidentally left a bag of the long Twizzlers open. I don't know if it was on the floor or

something, but their dog consumed, this was like a week ago, consumed an entire bag of large Twizzlers. At least one chocolate. Yeah. He's still alive. The dog is still alive. Let's go to the other side, Matt. What do you think is an underrated candy? Rolos, right? I mean, I'm not even a caramel fan, but Rolos, I love the taste. They come in the little gold wrapping, which always feels great, but I just feel like they, I don't know where they've gone. I don't see Rolos that much anymore. I will say this about Rolos, and I'm blanking on who makes them, but they clearly hit on something good, and they just decided, no, we don't need to innovate. It's not like

Mondelez with Oreos, where it's like, let's just try a new flavor. It's like, no, we've got a hit on our hands, we're just going to keep making this hit. No need to innovate. What about you, Jason? Chris, I get so siced for Whatchamacallits. I can't understand how we don't see them in every variety bag everywhere. The big candy bars, I think in mini form, they would be even better. I mean, it takes me back to my childhood. You remember the original Whatchamacallit that didn't have the caramel in it? Now that has the caramel in it, it's still delicious. I just don't understand how this is not a candy we see everywhere. Whenever I find those things

in my kids' trick-or-treat baskets, they're junior and senior in high school, but they still somehow come home with candy. I'm looking for those things, and I'll sneak them. I'm not scared. And they're not listening to this show, so they don't know, probably, that you're sneaking him. This weekend, we have an episode dedicated to the business of candy, because as any Hershey shareholder can tell you, it can be a very lucrative business for shareholders. And one of the things they're doing on that episode is power rankings of Halloween candy. Let's go to our man behind the glass, Dan Boyd, who's going to be on that episode with his power rankings of candy. But Dan, underrated, overrated? Any thoughts here either way? I just want to echo that both

Jolly Ranchers and Twizzlers are completely trash tier candies. Just throw them directly in the garbage. No need. I want to echo my sentiment from previous years of this, Chris, and remind everybody that the Milky Way is a joke of a product. Just completely awful. Just get a Snickers. It's 10 times better. And then as far as underrated candies, I want to go with the Humble Payday here. The peanut and caramel combination, I think, is extremely strong. Love it. Can't improve on that. All right, let's get to the stocks on our radar. Dan, I'll hit you with a question. Matt, you're up first. What are you looking at this year? Yeah, I'm going with one I'm sure a lot of listeners haven't heard of. It's Lenox

International, ticker LII. It's actually been around since 1895. They were kind of a pioneer in the business of forced air heating for homes. But they make and distribute HVAC and refrigeration products. Record results in the third quarter. They are a dividend knight, which means they have Beaten the market over the last 10 years and raised their dividend by more than 10% annually over the last 10 years. Since their IPO in 1999, up 1,800% versus the market, which is up only about 350%. Big-time performer. Impressive stuff. Dan, question about Lenox International? I don't know about the company, but man, the Dividend Night label is quickly becoming my favorite way to look at stocks. Is this

stock a dividend night? That sounds pretty good to me. Jason Moser, what are you looking at this week? Yeah, a company called SITM, ticker is S-I-T-M. SITM specializes in designing precision-timing microelectromechanical systems, or MEMS for short. Not to be confused with some metrics we discussed earlier in the week, like perhaps DTRG or something like that. But regardless, this is smaller, more efficient chips, essentially, is what they are, right? rugged, accurate, durable, effective. It's really about moving away from quartz and towards silicon, which is a better timing-keeping mechanism. It's better than the legacy quartz-based

system. That's what SciTime focuses on. Their solutions are used for everything from data centers to communications companies to those personal devices that we have in our pocket, Chris. As the world moves towards more technology, faster means of communication, the more connected we become. Really, the more MEMS timing systems are going to be required to make all of this happen, which just plays right into their wheelhouse. Earnings for SciTime out on Wednesday, November 2nd. Given the challenges we've seen in the greater semiconductor space, it will be noteworthy to hear what they have to say. Dan, question about SciTime? Now, Jason, to say that this market is

somewhat saturated is a little bit of an understatement when it comes to chips and your various silicon processors and everything. What about SciTime makes it special and interesting for investing other than, I don't know, a Taiwan semiconductor? Well, I think ultimately, it's that specialization in moving away from quartz to silicon. Their thesis, and this is one that seems to be playing out, is it's a more superior timekeeping device. and so that's what they're playing into. They sell their chips to big distributors who then sell to end customers. It's worth noting that Apple really is one of their largest end customers, if not the largest end customer. What do you want to add to your

watch list, Dan? No surprise, I'm going to go with the Dividend Knight. I'll go with Lennox International. There you go, Dan. Matt Argersinger, Jason Moser, thanks for being here, guys. Thank you! Thanks, Chris! I'm Chris Hill. Thanks for listening! We'll see you next time!