Motley Fool Hidden Gems Investing - Earnings and Elections

Episode Date: October 30, 2020

Alphabet surges on strong earnings. Microsoft reports higher profits but disappoints with guidance. Amazon reports record quarterly sales. Facebook falls on concerns over a decline in U.S. and Canadian users. Starbucks serves up a surprise. Apple dips on weak iPhone sales. And Netflix raises prices. Motley Fool analysts Andy Cross, Ron Gross, and Jason Moser discuss those stories and dig into the latest results from Etsy, Pinterest, Shopify, Tupperware, Twitter, and Under Armour. Our analysts share three stocks on their radar: Wix.com, Inphi, and EPAM Systems. And we talk about what the upcoming election means for investors. Learn more about your ad choices. Visit megaphone.fm/adchoices

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 this week, Andy Cross and Jason Moser. Good to see you, gentlemen. Hey, Chris. Hey, hey. It's earningspalooza. We have so many big earnings stories to get to. We have no time for a guest, but as always, we do have time for a few stocks on our radar. Let's begin with a few trillion-dollar companies. Alphabet's third quarter profits came in much higher

than expected. Google's online ad business continues to do well. Revenue for Google Cloud was up and YouTube revenue topped $5 billion. Jason Moser, a lot to unpack. What stood out to you? I think, generally speaking, the thing that stood out to me, this was a nice recovery from what was a pretty ho-hum quarter last quarter. Much like Facebook, Alphabet continues to benefit from this massive move from offline to online. And kind of harking back to Satya Nadella's quote from back in April, where he said, we've seen two years' worth of digital transformation in two months. And Alphabet, certainly one of the companies helping spearhead that and benefiting from it as well. But 15% top-line growth, very, very encouraging. They

have nine services with one billion users each. I mean, it's just amazing to really think about. To your point, a lot to unpack there. Google Cloud continues to perform very well. They had ended the previous quarter with a backlog around $15 billion. And for this quarter, they brought in revenue of $3.4 billion. It was up 45%, clearly well behind Amazon and AWS. But they're picking up share, which is encouraging. To YouTube, YouTube ad growth was really strong. It was up 32% from a year ago. Nice recovery. Last quarter, if you recall, they chalked up about 6% revenue growth, and that was due to some weakness in brand advertising. That brand advertising is starting to come back, and certainly YouTube has benefited from that. So, all things considered,

I mean, this is a business that has a lot of different ways to win. An interesting little factoid. A couple of factoids from the call I just thought were kind of noteworthy. They said, as a sign of the times, views for guided meditation videos are up 40% since March, and DIY face mask tutorials have been viewed over 1 billion times. So clearly, they are seeing themselves as part of the solution as opposed to part of the problem, and I think that's good. Investors should be happy. I'm not a shareholder, but that just makes me happy. I am a shareholder, and yeah, it makes me happy too, Chris. I got to go over there and look at some of those videos, because I can never get those

masks on properly. Microsoft's first quarter profits and revenue came in higher than expected, but guidance for the second quarter came in low, and shares of Microsoft down more than 7% this week. Andy, I get the short-term concern of people on Wall Street, but this is such an impressive business. Chris, absolutely. The sales growth of 12% was, I think, really respectable and higher than expectations, powered by its cloud business. Not to be forgotten, its office in the productivity segment did really well. Hello Teams continued to show lots of rapid growth. And the cloud

expectation growth for coming for the next quarter, up 6% sequential, I think is what people focus on. But just looking at the quarter, Chris, sales up 12%, now $37.2 billion for the quarter. that productivity and business process business. That's like Office 365, LinkedIn, the Dynamics business. That was up 11% in sales, much better than last quarter. The Intelligent Cloud business was up 20%. That was up versus the 17% growth in the fourth quarter. The Assure business, that big cloud business, that revenue was up 48% among that division. That was an acceleration off last quarter. So that acceleration, I think, may not be continuing as much going forward. I think that's what sent some investors a little bit worried and sent the stock down. The operating

income, Chris, continued to really grow. I mean, that operating income in that cloud business itself was up 39%. That helped drive overall growth because that's now such a large part of their business. The gross margin was up 15%. Their operating income was up 25% overall. that drove EPS growth really healthy up more than 30%. So overall, looking at the quarter, Microsoft continues to do really well. And that gaming revenue, can't forget about that gaming revenue up more than 20%. Xbox Game Pass now has more than 15 million subscribers. So across the board, when you look at all of the businesses, for the most part, Microsoft is doing really well. Shares of Amazon down a bit this week, despite the fact that third quarter revenue came in at

record of $96 billion. Jason, I'm pretty sure that record is only going to stand for a few months because the Amazon holiday quarter is just around the corner. Jason Moser. It is set up for success, that's for sure. You've got 37% top-line growth for the quarter, which you couple that with the 40% top-line growth that they recorded just last quarter. It's really still Amazon's world. We're just living in it. I mean, this is just a business that continues to perform so well in so many different ways. And to your point on the holiday quarter, they're going to enjoy their first $100 billion plus quarter this holiday season. That's just going to be phenomenal to think about there and how well Jeff Bezos continues to invest that capital, reinvest that capital back into the

business. You know, looking at Prime Day, that wasn't something that was reflected in the quarter's results. But Prime Day, we know, generated more than $3.5 billion in sales for the small and medium-sized businesses on its marketplace. That was up 60% from a year ago. Speaking of Amazon Web Services, another strong performance there, 29% revenue growth. Operating income was up 56% for AWS. Operating margin for AWS was up better than 5 percentage points. And that's now a $45 billion-plus annualized run rate business. It's still growing like a weed. So, just a lot of different ways for Amazon to win. And they continue to execute. Let me go back to Prime Day for a second, because we talked on this show

a few weeks ago, going into that week when Prime Day was happening and Apple was having their event to unveil the iPhone 12. And I think as a group, we said, Amazon's got a little bit more on the line here because they've had some bumps in 2020. They need to execute well. It now looks like it really was a test run for them. I mean, they spoke to that a little bit on the call. and for anyone concerned about, are Amazon packages going to get to me in time for the holidays? They appear to be doing everything they can to make sure that's the case. Yeah, they are. I mean, they did note that costs are going up. I mean, a lot of that is COVID related, but nevertheless, I mean, they are spending a lot on this business to sort of deal

with this new paradigm, so to speak, and the fulfillment logistics challenges that come with that. So, I think you're right. I mean, I think they are set up for success this holiday season from a fulfillment perspective. I think the bigger concern really is going to be from a volume perspective, the supply. I mean, are they going to have everything that everybody wants? That could be the crimp, so to speak. And again, I think the general recommendation for folks out there, don't wait until the last minute. I mean, Amazon is wonderful, but don't wait until the last minute, because it's going to be a challenging season for everyone. Pinterest is nowhere near a trillion-dollar company, but shares were up more than 25%

on Thursday after a blowout third quarter. Revenue was up, monthly active users, revenue per user. Andy, pretty much everything you would want to see if you were a Pinterest shareholder was up this quarter. Chris, if there's a better reported quarter, of, I haven't seen it. I mean, this is just really impressive. Revenues skyrocketed 58%, and that was just versus the 30% growth that they had guided themselves. Last quarter, a monthly active user jumping 37% now to more than $442 million versus $416 million last quarter. In the U.S., the revenue was up 49%. The monthly active users in the U.S. was up 13%. Compare that to the growth in international, which was up 46%. International continues to be the big volume

driver, but revenue per user is really driven by the U.S., but that alone was up 31% versus the growth on the international side of 66% on the per user side. Impressively, the profit picture really improved too. Their non-GAAP operating income was $84 million versus minus a negative $3 million a year ago. Overall, continue to drive a lot of interest in the Pinterest platform as more and more users are migrating there to be inspired by the visual representation there, but what Pinterest, the business is doing in their innovation on linking in their shopping, their auto bidding feature now makes advertising much more seamless for those small and medium sized businesses that now are relying more on Pinterest. Overall, just a really nice quarter

and the company continues to innovate and take advantage of the usage that is exploding on their platform. Coming up, earnings palooza rolls on. So stay right here. This is Motley Fool Money. Welcome back to Motley Fool Money. Chris Hill here with Andy Cross and Ron Gross. How are you doing, Chris? Jason Moser. I'm doing well, sir. Great. Shares of Facebook falling 7% this week. Third quarter revenue grew 22%, but Facebook's users in the U.S. and Canada, Ron, they actually fell a bit. Yeah, and they expect that to continue into the fourth quarter, which is interesting. But as you said, overall, things look pretty strong with the revenue up 22%.

Interestingly, that July advertising boycott, you'll recall, really didn't have much impact. This company is largely reliant on millions and millions of small businesses. So, you know, while there were some headline news there, it didn't really seem to make much of an impact on revenue. The shift to e-commerce this year has led to increasing demand for advertising, for sure. 2.74 billion monthly active users for Facebook. That's up 12%. Now, total expenses are up significantly. They're up 28%. Their costs continuing to grow as they invest in infrastructure, which includes R&D. Their headcount is up 32% this year. Legal expenses, they've got a lot of

stuff going on, up 33%. So that took a bite out of what would have been a pretty strong bottom line. A lower tax rate helped them get an earnings boost of 28%. But if we strip that out, operating earnings only up 12%. Now, I think what investors are focusing on from a stock perspective is the warning for what they're calling a tougher 2021. They see significant uncertainty, citing privacy changes by Apple, regulatory environment in Europe, increased expenses for many of the same reasons that we just discussed, including headcount and getting people back into the offices once the pandemic starts to wane. So, they're expecting a margin decline as a result, and it looks pretty clear to me that investors are not happy about that.

Shopify's revenue in the third quarter was nearly double what it was a year ago, and yet shares down around 10% this week. Andy, I get that Shopify has been on fire lately, so So, you know, over the past year, this stock has been amazing. This was a great quarter. It was, Chris. I think it's just the curse of expectations with a company like Shopify has done so well. As you mentioned, revenues up 96%, almost a double. Subscription sales up 48%.

Their merchant sales, which is things like their payment fees, their shipping fees, Shopify capital, did more than double up, 132% now, $522 million. Their gross merchandise volume, so all the volume across the Shopify platforms, did double. It was up 109%. That was a little bit of a deceleration, Chris, from last quarter at 119%. But it is above their pre-COVID level. So they're already back there. So when you look at the kind of merchants that Shopify continues to add to its network, add to its platform,

and the solutions, importantly, that it continues to evolve. I mean, Jason had talked about Amazon preparing for the heavy holiday shipping. certainly Shopify now with 6% of the e-commerce market, the second largest behind Amazon, is preparing for that. They're really working on building out their fulfillment network. They have these new initiatives with TikTok and Pinterest. More than half of eligible merchants now use Shopify shipping. That's up from 45% last quarter. So the profit picture is impressive when you continue to look at the scale that they're building out. But there's just some expectations with a company that has delivered so much so fast with Shopify that it looks like investors may be

taking a little steam out of the stock. But overall, a really nice quarter from the Canadian company. Apple shares down more than 5% on Friday. Apple's fourth quarter profits and revenue came in a little higher than expected. But iPhone sales weren't exactly lighting the world on fire, Ron. Yeah, not so great. Sales in Greater China were down 29%. That's the lowest since 2014. And that's largely the result of the delayed launch of the iPhone 12. Now, total revenue was up slightly, about 1%, which the company was quick to point out isn't that bad, considering there were no new launches during the quarter. So not too bad.

Total product revenue down 2.7%, driven, as you noted, by a 21% decline in iPhone revenue. But some bright spots, Mac revenue up 29%, iPad up 46%, as more people are using them for at-home learning, service revenue up 16%, wearables up 21%. So some strong numbers there, and I would expect to see iPhone regain their growth now that the iPhone 12 will begin to sell in November. Gross margins up a bit, but operating expenses up 14%. So that actually led to a 3.9% decline in earnings per share. So a decline in profits from Apple. No forecast for the holiday quarter. Investors are not happy at all with that. But it's still a wonderful company generating gobs of cash flow, $192 billion in cash. And let's not forget that the Apple One

subscription is launching today, which bundles Apple Music, Apple TV+, Apple Arcade. Cloud storage starts at $14.99. It is interesting to see the ripple effect as we've seen over the past few months, more companies reinstating dividends, increasing dividends, companies starting to give guidance. It is still a little jarring that a company as big as Apple and a CEO as experienced as Tim Cook says, nah, I'm not giving guidance for Q1. Yeah, you know, I guess the holiday quarter is such an important quarter. And so investors, you know, are even more upset to not receive guidance for that versus, let's say, you know, a mundane second quarter. But, you know, he's sticking to his guns, and we'll just have to wait and see how they look.

Starbucks wrapped up the fiscal year with a better-than-expected fourth-quarter report. And what that means, Andy, is that same-store sales in the United States were only down 9%, and comps in China were only down 3%. I shouldn't be fun. This is legitimately better than people were expecting. And it's amazing to me that Starbucks shares have held up through 2020, the extent to which they have. The Bucks is on its way back, Chris. Sales were down 8%. Global comps, comparable store sales, down 9%. But that's an improvement from the down 40% last quarter, Chris, down 23% in transactions. That was lower than the last quarter, which was down minus 51%. Average ticket still up 17%.

And that was down from up 23%. But as you mentioned, Chris, it was versus the 12% to 17% drop they had estimated for the global and U.S. combined comps. And overall, just you look at the way that Starbucks has really tried to rebound from this. They've opened 480 new stores. That includes 40% growth and now have almost 33,000 total stores. Their loyalty card, 90-day active members in the U.S. up 10% to 19.3 million now. The increase of dividend by 10%, Chris, their channel development business was up 17%. That's ahead of the market growing 9% in that business overall. They're ready to drink business. Those solutions up 15%. The guidance for the next fiscal year for their global comps was 18 to 23%. So overall, looking at the way that Starbucks has

rebounded from this, their learnings in China, getting on top of it, they just thought that this, I look at this quarter and say, you know, it's not over. They're definitely not out of the would yet, Chris, but really operating very nicely. They're going to be very judicious in how they open up their stores, being very careful. They're going to close a bunch, even more than they thought so in the metro markets that are a little bit more dense. They're really underperforming. So when you look at their investments they're making, the way Kevin Johnson has managed, he and his team have managed this business and rebounded from those lows, which were just really drastic earlier in the year. It's been a nice rebound

for Starbucks. Andy, I know my family is single-handedly responsible for the increase in sales of pumpkin bread, but are we the only folks eating food at Starbucks? Is the food business at Starbucks going to be hurt by the model going forward? It has. I think it already has. It's really the coffee business. As I mentioned, as we now go, and I've done this, I've bought more coffee and more drinks. You load up, so the transactions, the volume of transactions are down, but when you go there, you spend more. But I think that's mostly on the coffee business and really talking through how they are continuing to innovate and serve those clients. And now mobile orders are a full quarter of total sales,

and that's up really nicely over the past year. Coming up, more earnings, including one stock that's up more than 25 times in value since the spring. This is Motley Fool Money. Welcome back to Motley Fool Money. Chris Hill here with Ron Gross and Jason Moser tagging in for Andy Cross. Twitter's third quarter profits and revenue came in higher than expected, but user growth is slowing and shares of Twitter down 20% on Friday. Jason, for anyone wondering if this is an overreaction, it's probably worth pointing out that Twitter's business has never really earned the benefit of the out. I agree with that totally, actually.

I used to be a little bit more bullish on Twitter. These days, I am certainly a bit more bearish, and for a lot of reasons. I think ultimately, Twitter has a growth problem, and reframing the user metrics can't hide that. That's what they did when they went to that monetizable daily active users. I do agree that Twitter as a daily use platform, metric is more relevant. But when you look at the raw numbers compared to other competitors in the space, I mean, it's clear as day. I mean, you've got Snap with somewhere in the neighborhood of 250 million, Pinterest at 442 million. I mean, Twitter sitting there with 187 million daily active users. I mean, sequential growth was basically non-existent. In the revenue, growth

shows it too. I mean, if you see users were up year over year, now not sequentially, but year every year, users were up 29%. Revenue only grew 14%. And that's a problem. And I think one of the concerns is that they continue to invest in their ad tech, and they continue to delay rolling out this new ad tech, these new features. And in this direct response market that is such a big opportunity, they're not really able to participate in it to its fullest, because they just continue to move so slowly. And then you've got the whole other issue there of becoming more consistent with their community guidelines and policies. I mean, they can't offer up certain guidelines and standards to then only act another way and then apologize for later saying it was bad

judgment. It's a constant state of confusion there. They need to figure that out. It does feel like one of those features that they rolled out, the topics feature, which I know could be a little bit of a hot button issue for some people. It did reach 70 million users by the end of the quarter, and that was up 40% from a quarter ago. So maybe that's something that could be sustainable and monetizable, but that remains to be seen. Regardless, they continue to just move so slowly. They have so many things to figure out. It's not a very encouraging picture these days. Well, that was something you and I were talking about earlier in the week, because we're both pretty active on Twitter. And I remember just asking you on the side, like, hey,

they keep pushing this topics thing. Is there a way to shut that off? And you're like, no, I don't think there is. And then when we got the quarterly results and the growth that you mentioned, I thought, oh, that's why. It's like, OK, I find it annoying. But from a business standpoint, I completely understand why they're doing it. I mean, yeah, I do, too. And I guess the question is, will it be sustainable? I mean, it's one thing to try it. It's another thing to continue to use it. And then you look at just the overall environment on Twitter. I mean, it is becoming a very toxic place. I mean, unfortunately, it's so levered to politics, which is really just not a great place to be right now. And so, I mean, I think that they have a lot

to clean up there on the platform and on the user side. And unfortunately, because they're so levered to politics, it ultimately is just going to make half their user base feel alienated, which is it's going to obviously impact that user growth. So, I don't know that expecting any user growth is really a reasonable expectation at this point, and that's going to be a real drag on the business for sure. Signs of life from Under Armour. Third-quarter profits and revenue were higher than expected, and the company sold its MyFitnessPal platform for $345 million. And yes, Ron, that is less than Under Armour paid for it five years ago, But as a shareholder, I feel like they're making progress.

Buy high, sell low, is that the mission? You know, revenue is flat here, which is actually a good thing and is better than expected. Online ordering, not the physical stores, drove that beat. Direct-to-consumer up 17%, wholesale and store retail was weak. And they're attempting to really de-emphasize physical stores to the point that they can. They're going to reduce some North American distribution points, they're going to try to cut 2,000 to 3,000 distribution points, which will end them with about 10,000 still existing by 2022. We saw strength in footwear up 19%, accessories up 23%. I think that's likely

reflecting the trend of folks exercising more at home. Apparel, a little bit weak at 6%, even though lots of us are likely looking to get comfy while we work at home. Gross margins were down. Product mix was largely related. It was the cause of that, including COVID expenses. The company has had $550 million of restructuring and impairment charges so far this year, $74 million just in the third quarter. So, right there, that gives you an indication of how this business has been run. Not great. They were slightly profitable, just a net income of $118 million. And as you said, they'll be getting some cash in the door through the sale of the MyFitness app, as well as the Endomondo platform, which they're selling for $85 million as well.

Etsy's third quarter report was impressive on the top and bottom lines, but shares falling more than 10% this week, in part because expenses are also rising for the specialty retailer. Jason CEO Josh Silverman says, this is the perfect moment for Etsy to make big investments in marketing. You agree? Well, yeah, absolutely. I mean, I think he's certainly walking the talk. I mean, Etsy is playing some serious offense these days, and the good news is for them that it appears to be working like a charm as they continue just to smash their own internal expectations. To your point on the marketing spend, I mean, they ended the third quarter with consolidated marketing spend of $127 million. That was up 153% from a year ago. I mean,

that is just amazing, the willingness to spend on this business, but it is working. They brought in gross merchandise sales of $2.63 billion for the quarter. That beat their own guidance, which was a range of $2.2 to $2.5 billion. Revenue of $451 million and adjusted EBITDA of $151 million also beat internal expectations. They now have 3.7 million sellers, that was versus 3.14 a quarter ago, and 69.6 million buyers versus 60.3 million a quarter ago. Etsy payments and Etsy ads continue to drive revenue as well. I wouldn't be worried about the sell-off and the stock price. I mean, it's had a good year, and it's a business that continues to really, really impress. I think that even as we get past this pandemic, I mean, this is going to

be a company that just continues to see many bright days ahead. The stock of the week is Tupperware. Yes, Tupperware. Third quarter profits were three times higher than Wall Street was expecting. Shares are up 45% this week. And Ron, in the spring, this thing was just over $1 a share, and now it's around $30. So, you're telling me it's not only technology stocks that go up. This is not cloud Tupperware or Tupperware as a service. This is just Tupperware. This is actually a very interesting turnaround story for people who have not followed it, and I think that's most of us. And it's also helped by everyone significantly eating

more at home. So you have a turnaround plus the impact of COVID. So the turnaround plan includes a new CEO, new executive team. They're paying down debt. They've been over-levered for quite some time, they're improving their cost structure, they're selling non-core assets including real estate, and then you have the benefits of what just took place in the quarter. So, sales are up 14%, and you got to remember now that this is still largely a registered rep party plan model, the old Tupperware party still is in existence. Their average sales force was up 10%, active sales force, and the sales per active sales force was up 10% also. Those two things compound to really boost some nice growth. Management

highlighted new digital tools that reps are using to sell the products in these crazy times. All regions were up except for Asia Pacific, which was down 6%, but North America, clearly the highlight, up 42%. They delivered $60 million in cost savings during the quarter and that led to a 233% increase in earnings per share. Not too bad. Let me ask the question that I would be asking if we were talking about a SaaS stock or a cloud stock. It's up more than 25 times in value since the spring. Is this an expensive stock at this price? Hey, you know what? I think it's only trading for nine times EBITDA, if memory serves me correctly,

which it is not an expensive stock in that regard, but they have to keep turning this business. I'm not sure I love the continuation of the party planning model, they might want to think of more multi-distribution in a bigger way, but it's not that expensive, no. Up next, it's not our Thanksgiving show, but we do have a little humble pie that we need to snack on. Details after the the break. 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, with the entire crew, Jason Moser, Andy Cross,

and Ron Gross, all together for the homestretch, guys. Guys, on last week's show, we talked about the latest earnings from Netflix, and Ron, I asked you if you thought they were going to raise prices, and honestly, I wasn't even that objective. I framed it as, they're not going to do this, are they? It was one of those things, like, if it was a courtroom, the other lawyer would be like, I object, he's leading the witness. It turns out we were both wrong. We said, no, they're not going to raise prices. And this week, Netflix announced it is raising prices. Its most popular plan is going to go from $13 a month to $14. The premium plan goes from $16 to $18. They got pricing power, Ron, and they are wielding it.

I am surprised that they chose to exercise their pricing power during a pandemic when everyone's stuck at home looking for something to do. It doesn't actually sit right with me, be honest with you, but they can do it. We'll see how it impacts subscriptions. If it does, it probably won't. It's not an incredibly large hike. It's only been about a year-and-a-half, I think, since their last increase. They've had five hikes in six-and-a-half years, so maybe we should have realized that one was overdue. But just because of the times we're living in, it did take me by surprise. Andy, it's going to be interesting to see when the next one is coming, because at some point, they got to go over $20 a month.

Well, it's not like they have any obligations to pay for over the next few years in content streaming, so they got like $19 billion in due. So, yeah, I think this is just a little bit more evidence of what they think they can raise from a pricing power perspective. I think they have lots more room to go when you look at the competitive landscape out there and the prices they're charging and as long as they continue to innovate and get their people paying more and watching more movies, I think it's a good thing. I would also just say, I mean, I agree with you, Ron, it does seem like odd timing, I'm not necessarily in agreement with them on that, but it's also, to Andy's point about the obligations, just do a little bit of the back

of the envelope math when you get a chance and recognize the fact that a bump of a dollar in subscription charges isn't going to make really much of a dent in the obligations that they owe. I mean, they owe a ton of money and that's always going to be the case, because they have to keep on producing all this content. So, it is going to be something that, I don't know, it feels like it's never going to end, they're going to run into a wall eventually. But I think expecting these types of price increases for the foreseeable future is reasonable. Real quick, while we're on the topic of streaming, we didn't get to Comcast's quarterly report, but Jason, the thing that stood out to me. Peacock has more than 20 million sign-ups already. That's a pretty

good start they're off to. It's a great start. I think we all had a little bit of fun with it when they were launching it. Maybe that was more centered around the name than anything else. But hey, really, you know what? It's a lot easier to understand the brand there with Peacock than all of these different HBO iterations and CBS's efforts at rebranding and whatnot. Listen, I tried Peacock, I'm impressed with it. I'm in the middle of of watching Mr. Mercedes on there now. Well done, by the way. I think the books were better, but still a good show, and it's a good experience. So, hats off to them. And Netflix has to realize that it's been a long time since they were the only game in town,

and there's a lot of good streaming services out there battling for our dollars. So, I would just say, be careful how often you raise those prices. Real quick, before we get to the stocks on our radar this week, I don't know if you heard, but there's a presidential election here in the United States next week. let's just go around the proverbial table real quick and ron i'll start with you for anyone who is looking at their portfolio and thinking about investing around the election what's one piece of advice you'd give i would say stick to stick to your knitting just because it's election season doesn't mean you should be doing anything different i haven't made one move that's directly

related to the election we're going to see different policies depending on who wins different taxes, different regulatory environments, buy great companies, hold them for the long-term. Jason? Yeah, I think that the best action is often inaction. Don't fall for any knee-jerk reactions. Look back at the history of presidential administrations and understand that markets go up, they go down. However, this shakes out, just don't do anything rash. I almost have nothing to add to that great advice, but I guess I will say is, you can expect a lot more volatility both, not just next week, but I think going forward. So,

you want to make sure you're ready for that and have a watchlist, have a buylist ready to go if you have some cash sitting on the sidelines, you want to put the work, I think over the next few months you're going to get some better prices. By the way, if anyone listening is a member of any of The Motley Fool services, you can go to election.fool.com for more insights and analysis now and throughout next week. If you're not a member of any of our services and want to check out our flagship service, Stock Advisor, get stock recommendations from Tom and David Gardner. They're best buys now and a lot more. You can go to radarstocks.fool.com. That's radarstocks.fool.com. Get a 50% discount because you are one of our dozens of listeners.

Let's get to the stocks on our radar. Our man Steve Broido is back where he belongs, behind the glass. Ron Gross, you're up first. What are you looking at this week? I recently started looking at Wix.com, W-I-X. It's a Stock Advisor re-recommendation back in August. They're a do-it-yourself website builder platform, makes it easier and cheaper to create a website with really no design or coding experience needed. Both of my kids have used them to create websites, which is really what got me interested, and I must say it was pretty easy. they've got a bunch of things going for them. You know, there's no upfront cost if you want to create a website, but they do have almost 4 million paying customers as well. Trends in

social media and e-commerce are only adding to the growth in this business. Both co-founders are still really, really involved. And they have a new high-end service, which puts them up against Shopify. So, I need to dig into a little bit more on that, because that sounds either like an opportunity or a risk, and I'm not sure which yet. Steve, question about Wix? Sure. It seems like Wix popped out of nowhere. It was Squarespace and then Wix just out of nowhere. If you just advertise enough, can you become the big dog? They've done a good job. Their platform is very strong and the growth has followed along. Jason Moser, what are you looking at? Yeah, a company I've talked about here on the show a couple of times, maybe,

EnFi, ticker is IPHI. We saw the news this week that Marvel Technology will be acquiring EnFi, unfortunately. I was actually looking forward to letting this company do its thing for a while. But EnFi considers themselves in the bandwidth business, right, via its semiconductor components and optical subsystems. And so, Marvel sees this as a great 5G play. I do agree, it's a great 5G play, that's why I like EnFi so much. The deal is going to be financed though with a combination of cash and stock, and all-in, it values EnFi at around $163 per share. So, you see, obviously, it's trading well below that right now, as we see oftentimes when stock is a part of compensation there. So, there will probably be some arbitrage opportunities for investors.

We don't typically recommend that course of action though, but nevertheless, we'll be keeping up with it to see if this is a deal that actually ends up going through it. It looks like it will, though. Steve, question about Infi? You bet. Will 5G replace my home internet service? Will I all be wireless all the time? No. I mean, it'll be part of the overall solution, though. I mean, we're looking at all sorts of different ways this technology is going to play out. 5G will be a part of it, you've got Wi-Fi 6 that's going to be a part of it as well. And then, hey, Steve, by 2030, we're going to be talking about 6G, so just hang in there. Andy Cross, what are you looking at?

Steve, I'm looking at EPAM Systems, symbol E-P-A-M, provides outsourced software and technology, digital content consulting for technology companies, media companies, pharmaceutical companies, financial services, the whole gamut. Founded in 1993 by Arkady Dopkin, who's still CEO. It works with half of the top 10 banks, 80% of the largest pharmaceutical companies, has a really admirable track record of being what I call a 2020 company, Stevo. Consistent, steady 20% growth in revenue and profits. Last quarter, it actually fell below that level. So I'm looking to see when they report earnings next quarter, if they're getting back to that. It's an $18 billion company. Stock's done really well, up more than four times in five

years. So reporting earnings next week. So a lot to watch to see what they are talking about their market? And are their clients willing to spend more with them? Steve, will a continued pandemic help or hurt this company? No, I think it will continue to help because of the consulting, the digital market they play in. It's not a huge driver like it is for the likes of Pinterest or Shopify, but it does definitely help. What do you want to add to your watch list, Steve? I'm going, is it iFi or IPHI? Infi. Infi. Yeah. Count me in. I'm infi. Love it.

All right, Jason Moser, Ron Gross, Andy Cross, thanks for being here, guys. Thanks, guys. That's going to do it for this week's Motley Fool Money. The show is mixed by Steve Broido, our producer is Matt Greer. I'm Chris Hill. Thanks for listening. We'll see you next week.