Motley Fool Hidden Gems Investing - Is Equifax the Next Enron?

Episode Date: September 15, 2017

Apple unveils its new iPhone. Target hires for the holidays. Oracle shareholders have their worst day in years. Nestle adds some caffeine. And Chipotle rolls out queso. Plus, film critic and corporate governance expert Nell Minow weighs in on the Equifax data breach and the disappointing summer box office.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Support for Motley Fool Money comes from our friends at Rocket Mortgage by Quicken Loans. Home plays a big role in your life, that's why Quicken Loans created Rocket Mortgage. It lets you apply simply and understand the entire mortgage process fully, so you can be confident you're getting the right mortgage for you. To get started, go to rocketmortgage.com slash fool. 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, and joining me in studio this

week for Million Dollar Portfolio, Matt Argersinger. From Motley Fool Pro and Options, Jeff Fischer. And from Total Income, Ron Gross. Good to see you as always, gentlemen. Hello. We've got the latest headlines from Wall Street. We've got the latest on the Equifax debacle with our guest, Nell Minow. And as always, we'll give you an inside look at the stocks on our radar. But we begin with the biggest public company out there. On Tuesday, Apple held their much-anticipated event to announce upgrades to the new Apple Watch and the upgraded Apple TV. The big headline, though, Matty, the unveiling of the iPhone X. It comes with

facial recognition and a price tag of $1,000. Lots of expensive bells and whistles. But let's talk about the iPhone. It's still 70% of Apple's total revenue, I ran across this article by one of our Fool.com writers, Ashraf Issa. I hope I'm getting that right, Ashraf, if you're listening. He pointed out something interesting with the launch of the iPhone 8 and iPhone X, and that is, unlike previous launches, Apple's not discontinuing the older models. They'll still make the iPhone 7, still make the iPhone 6, even still make the iPhone SE, which is the cheapest model. I think this This is an interesting shift that's not really being talked about, in that Apple now has

a range in the iPhone, ranging from as low as $350 up to over $1,000 for the iPhone X. I think that's an important strategic move as they try to gain market share in places like India and China, where someone's not going to spend $1,000 for a smartphone. The risk here, of course, is what it does to Apple's average selling price for the iPhone. I think that's the thing, as an investor, I want to be watching for. I want them to be able to gain market share around the world with the iPhone, but at the same time, I want to hold onto those high ASPs. If not enough people buy the iPhone 8 and iPhone X, that's not going to happen.

Well, let's face it, consumers love a good installment program, and that's how I think they'll sell this $1,000 phone. Amortize that over two years, it doesn't feel like $1,000. Even now, $600 or $700 phones don't feel like $600 or $700 phones, because we're paying it off monthly. I harken back to the days of the subsidized phone, but those days are gone. So, I do think this will sell, and I don't think the $1,000 will scare everyone away. Maybe a few, but I do think it'll sell. The only piece that I think they're going to have trouble with is the facial recognition. I'm concerned about that. I'm concerned the glitches, I'm concerned people aren't going to like it, and there could be a problem.

Yeah, it's one thing, Jeff, to have your fingerprint. I don't know. There just seems, on a gut level, on an emotional level, it's one thing to activate your phone with your thumbprint. It's another thing when it's your face. I may be an exception there, because I don't really mind. That doesn't bother me. If I've given my fingerprint out ... Well, you're handsome. That's kind of you. For security reasons, there's much more to worry about, in my opinion, than your face or fingerprint once you've already put it out there. But what I want to talk about, Chris, I love the pivot, is their headquarters. Their new headquarters look amazing. I think they

could sell tickets just to tour that place for a pretty penny. But as to the product rollouts, I would give Apple about an A on the new phones, the new watch, and the new Apple TV. All look compelling to me, and Apple seems to be executing across the board. You have to be happy, Matty, if you are the mobile carriers here, because in addition into the excitement around the new phone. There was also some buzz. The latest version of the Apple Watch is now going to have cellular service, and there are mobile carriers that are happy to provide that service for an extra $10 a month. That's right. More devices connected to everything. I'd also throw in, in addition

to the Verizons and AT&Ts of the world, the American Towers, the Crown Castles, SBA Communications, all those wireless towers that are enabling all these devices to be connected. More and devices are coming online every day. So true, Chris. We didn't even talk about the software enhancements that are upcoming. And then, Apple services, which we talk about regularly here on the show, is a giant business in and of itself, high margin, and it continues to grow. I think I might. I was convinced, you asked us this at least once a year, what's going to be the first trillion-dollar publicly traded company. And we know Apple's had this

lead. I've been hot on Amazon to that, but now I think Apple's got the momentum. They probably do it, and they probably do it pretty soon. Should we let Matty change? Because I said Apple. No, no, no. I'm not changing. I'm not changing, but I might have to concede here earlier. So, they have the event on Tuesday. Pre-orders come later, and people actually getting this brand new phone in their hands comes later than that. In terms of all the investors out there, when should we expect to see some sort of material result in their results? Well, I mean, this is a fourth quarter story, I would say. So, this is all about

the momentum. The pre-orders, I think, start at the end of September. I'm sorry, is it the end of October? End of September. I can't remember. I'm off by a month. It's going to be November before people can actually ... Haven't we already started hearing about some inventory problems, perhaps, though, which you never want to see that, right? Yeah, it's likely to go well into next year, next calendar year, as sales keep coming through. I think the fourth quarter, we'll get our initial look and see what kind of momentum that phones have. And I expect they'll have quite a bit, as Ron was alluding to.

This week, Target announced it will be hiring 100,000 seasonal workers for the upcoming holidays. That is a 30% increase over what Target did last year. Ron, am I wrong to be slightly optimistic about the retail industry as a result of this? Well, I was a bit surprised. It's actually, I hate to correct your math, but it's a 43% increase from the $70,000. $70,000 to $100,000 is a 43% increase. Target is seeing something that I wouldn't have guessed they would be seeing. Last quarter for Target was not so bad, let's say. They posted an increase in comparable same-store sales for the first time in a while. And they're obviously seeing momentum carry through, enough to really put

money on the line and take all these people in, including an additional 4,500 people to their distribution centers and fulfillment facilities, which I guess are there to help with their online fulfillment, and that was up 32% last quarter. So, if this follows through and turns out to be a good decision, then maybe Target is back. I'm in the wait-and-see mode, to be honest. Well, I'm also a little bit in the wait-and-see mode. And by the way, don't ever feel bad about correcting my math. But Macy's came out with their seasonal hiring plan. It's lower than what they did a year ago. I almost feel like we have to sit on the sidelines and wait and see what

Walmart announces. Between Walmart and Target, those are the two biggest dogs when it comes to bricks and mortar. Right. Like Ron, I feel like Target's probably really in the second place to that. The investments that Walmart has made kind of put them in the lead, if we're not talking about Amazon. I just feel like Target probably hasn't taken the big steps that Walmart has. On Friday, Oracle shareholders had their worst day in four years. First quarter profits were overshadowed by weak guidance for the rest of the fiscal year. How bad was this, Jeff? Not as bad as Wall Street would have you think. The revenue guidance for the next

quarter is for 4.5% to 6.5% top line growth, and earnings per share guidance of 7% to 13% growth. I think what Wall Street was most upset about was the guidance for cloud revenue growth was about 43%, and that's down from 51% this quarter. So you're seeing some deceleration in the cloud business growth, which is the key pedestal to Oracle's future. The company is transitioning from a license-based software business model to a cloud-based, and cloud still only makes up about 16% of its total revenue. So Wall Street likes to see that transition go quickly,

more quickly than it is in the upcoming quarter. That's why they were a little disappointed. But shares are now at 16.7 times estimates for the year. Makes it look very reasonable in this market. And I still like the long-term story at Oracle. So, if cloud for Oracle is only about 16% of their revenue, why do you think we're seeing this reaction in the market? Is it because this has become such a fiercely competitive space with, to name a few, Alphabet and Microsoft competing in this space as well. Yeah, and Salesforce and others. That's partly it, Chris. Oracle has been growing more quickly than the industry and key competitors, so it can say, hey, we're taking market share

from these people. And that's still true. But if you see a slowdown, at least even a modest one, you might start to question how much more they can grow and how big they will get in the cloud. That said, Oracle did buy NetSuite for more than $9 billion in the past year, and that clouds or distorts this guidance as well a little bit. Shares of iRobot fell more than 15% this week after appliance maker Shark Ninja launched new products that will compete head-to-head with iRobot's Roomba line. God, that's a great named Shark Ninja. But, Matty, do you think this is an overreaction? I mean, this was a story that, when this was happening earlier in the week, we were all sort of looking at

each other saying, does anyone know what's going on with iRobot? I did. And it's not just that it fell, but it fell on very heavy trading volume. Right. And I think it was down again on Friday as well. It feels like an overreaction, because Shark Ninja has come out with a new robotic vacuum cleaner, compete with the Roomba. But I think maybe the drop in iRobot was also accelerated a bit by a short report out of Spruce Point Capital, which I hadn't heard of before, which says, hey, Shark Ninja is a credible threat. This is a company, if you don't know the Shark vacuum cleaners, they kind of took a lot of share from Dyson over

recent years. So, it's definitely a legitimate competitor. But the reaction to the stock, given that this is a totally new product, it hasn't really even hit the market yet, But iRobot has the market share with Roomba. It seems like a bit of an overreaction. I will point out that iRobot stock was trading for about 50 times earnings before this latest drop. So, you had the valuation argument going there as well. Do these robots work? I know you've said you have them. The bizarre thing is, I own both a Roomba and a Shark vacuum cleaner. Because the Roomba is great for the once every few days, kind of goes around your apartment or small,

if you have a house, cleans it. But it doesn't get the corners, it doesn't get the tiny nooks and crannies that you need to get, and you need another vacuum cleaner. I felt like Steve when I asked that. Do these work? You sounded to me, well, a little bit like Steve, but you also sounded like someone who might be in the market for a vacuum. I'm in the market for not vacuuming. It's funny.

A lot of companies now, Samsung, a lot of companies, Dyson, are making robotic vacuum cleaners. So that may be part of the problem is now that robots are becoming more a part of our daily lexicon, competition is going to grow. And iRobot, which has had this lead for all these years and does have all the highest-rated robotic vacuum cleaners may see their margins have to come down. Coming up, the coffee war has just got more interesting.

Stay right here. You're listening to Motley Fool Money. We're going to spend all your blue money, blue money. Welcome back to Motley Fool Money. Chris Hill here in studio with Jeff Fisher, Matt Argesinger, and Ron Gross. You can check out past episodes of Motley Fool Money and all of our podcasts just by going to podcasts.fool.com. you can also test drive our flagship service, Motley Fool Stock Advisor. The brand new issue

just came out. Two new stock recommendations from David and Tom Gardner. And you also get Best Buys Now and a lot more. So, check it out by going to podcast.fool.com and just scroll down at the bottom of the page. You can also check out the new logos. New logos. Yeah, new podcast logos. Every once in a while, we like to put on a fresh coat of paint. Over the past 15 years, a few analysts have been as tough on the big banks as Mike Mayo, which is why a few eyebrows were raised this week when Mike Mayo proclaimed that, quote, U.S. banks have the strongest balance sheets in a generation. You agree with that, Ron? I don't want to, because banks scare me. But I think I have to. The data, I think, bears

that out. If you recall, back in June, they had the stress test that they perform on banks. All 34 of our institutions passed, including the big boys, and that hasn't always been the case. They have a new measure that they have to beat, which is called the supplementary leverage ratio, which makes sure they can handle off-balance sheet exposure as well, which is one thing that has always scared me. Now, the banks will tell you that it's too constraining that they have to beat those kinds of measures, and it hurts their competitive nature, but I think we learned in 2008 that some of those things are necessary. So, you know, the Fed also just recently said they could pay dividends and buy back stock as well as a result of the strength of their balance sheets. So, all indications are good.

It bolsters the argument for some deregulation perhaps being okay. I know Trump certainly wants to push that through. I caution, it's a slippery slope, let's just be careful. Yeah, I recently did a screen of most of the major banks in the U.S. and it's quite it's astounding, actually. The average equity-to-assets ratio is a way of the safety of a bank. The average is over 13. In normal, previous average cycles, that's in the single digits, like 5, 6, 7 is considered a good equity-to-assets ratio. It's 13. And the average non-performing loans percentage of total assets, 0.5%. So, it's tiny. Banks are about as safe as they've ever been. Whether or not they're good investments, can't tell you that.

That's interesting, because they're only up about 3% this year in the aggregate versus a market which is, what, 11% or so. So, underperforming, yet it would appear to be the right time if you want to get in. Yeah, it speaks to the fact that they don't see that many places to lend money out to earn good returns. So, they have strong balance sheets, but they're not ... No where to go. Good point. Nestle is known for its wide portfolio of consumer brands, including Stouffer's Frozen pizza, Friskies cat food, and Kit Kat candy bars. This week, Nestle went for the high

end of the coffee market by acquiring a majority stake in Blue Bottle Coffee. Jeff, how worried should the people at Starbucks be? Well, not un-worried. They should worry a little. Is that a word? Yeah, it is now. I would have some concern even before this, because specialty, higher-end coffee chains are growing in popularity and growing in number. Now, that said, they're only about there are going to be about 50 blue bottle cafes by the end of this year, and they're mostly on the coast.

But Nestle buying them for the air, they bought a 68% stake for about reportedly $500 million with plans to grow the store base significantly. So Starbucks should have its eye on this trend, and it does. It's offering its own high-end store experience and coffee experience as well. But, another issue would be just the way a brand ages over time. Starbucks has been hot for so long that it's bound to cool, and it has in many regards. If something new comes along and replaces it as your daily habit, that's hard to then get it back in your favor.

We've talked before about how the number of public companies has dwindled over time. One of the interesting parts of the Blue Bottle Coffee story is James Freeman, the founder, was asked in the wake of this deal, why wouldn't you just look to go public? And he said, and I quote, everything that I've seen and read, it seems like a way of living in hell without dying. So, James Freeman. That might be an exaggeration, but the sentiment is well taken. Not someone aspiring to be a public company CEO. No, he was a clarinet player before this, and then he followed his other passion of

coffee. It's disappointing, though, because Blue Bottle is a company I was watching, hoping someday it would go public. And this is another case where investors like us are taken out of the mix as far as getting rewarded from a growing company. That said, he also said, you know, we're going to maintain control. We're not going to be selling Nestle bars in our cafes, and we're going to do everything we want to do. That sounds a little naive to me, when you've sold 68% of your company to a giant like Nestle, who's going to want to then drive your results. For many investors, Tuesday, September 12th, was all about Apple's unveiling of the iPhone

2010. But there was another launch that didn't get quite as much attention, Chipotle's nationwide release of all-natural queso. What do we think? Is this going to move the needle for them, Matty? I like queso like any other guy who likes Mexican food, but I don't know. Like we talked about before the show, it might be a little additive to the total tickets that people are doing when they go to Chipotle, but not much. Not a needle mover. I got to say, Ron, I was a little excited about this until I saw that it was all natural. I like my queso to just be manufactured. Right. Most queso out there has things called stabilizers put in to make sure it

maintains that creamy texture, and Chipotle had to find a way around that. We'll see how it tastes and what the mouthfeel, for lack of a better word, is like, but it's not my thing. Someone who's going to get used to liquids real soon, real fast, is our man behind the glass, Steve Broido, who's just days away from having his tonsils taken out. Steve, are you going to hit a Chipotle before the surgery just to get a little queso and chips, maybe? Well, not if there's no stabilizers. I'm afraid they're made by that weird wheel company Ron keeps talking about. Titan. Don't be harsh on Titan. All right. Ron Gross, Matt Argesinger, Jeff Fischer, guys. We'll see you later in the show.

So, the situation with Equifax seems to get worse by the day, and up next, we will dig into the latest with our guest, Nell Minow. Stay right here. This is Motley Fool Money. All right, before we get to Nell Minow, I want to say thanks to our friends at Rocket Mortgage by Quicken Loans. Chances are, you're confident when it comes to your work, your hobbies, and your life. Chances are, Chipotle is confident about the queso that they rolled out.

Fingers crossed there. Well, Rocket Mortgage gives you that same level of confidence when it comes to buying a home or refinancing your existing home loan. Rocket Mortgage is simple. It allows you to fully understand all the details and be confident that you're getting the right mortgage for you. To get started, go to rocketmortgage.com slash fool. Equal housing lender, licensed in all 50 states, NMLSconsumeraccess.org, number 3030.

Welcome back to Motley Fool Money. I'm Chris Hill. Why is Nell Minow our most frequent guest on this show? Because she's a film critic and we love movies. Because she's a corporate governance expert and we cannot turn away from the spectacle of companies screwing up. Nell, good to talk to you. Well, thank you. It's been a while since we've had a screw-up quite as big as this one. Yeah, we're going to start with Equifax, A company which has lost a third of its market cap in just over a week.

And for those who may have missed it, a massive data breach that exposed the personal data of nearly 150 million Americans. And the number of investigations into Equifax seems to be growing by the day. Let's start with this. What type of review do you give Equifax in the way they have handled this so far? um i give them an f um is there a better lower grade i don't you know it they they really pretty much have done everything wrong uh uh was it chuck schumer who said this is the biggest corporate catastrophe since enron um i i think that's right the difference between this and other data breaches is that you can say well you know i i got my credit card to target and they

breached it but i'll get a new credit card and it won't cost me anything and i've got no downside risk whatsoever. Nobody voluntarily gave their information to Equifax. This is much more vital and personal information than has ever been breached before. It's obviously a bigger breach in terms of numbers of people affected than ever before. The preliminary information that we have so far is beyond shocking, including that they had some knowledge and ability to prevent this and that they didn't do it. And the most shocking of all, is it possible that officers in the company sold the stock before the announcement? Because if that's true, that is mind-blowing in its stupidity and carelessness. I'm glad you mentioned the other data breaches,

because I think whether it's Target or Home Depot or in certain name of any company that has had a data breach over the last few years, and there have been many. I think it is easy for the average person to see the headline about Equifax and lump this incident in with all those others. And as you said, this is so different from those. This is the cookies. I mean, this is it. This is, you know, even though when the Social Security law was first passed, they specifically said this will never be used as an identifier. Of course, it is used as an identifier. This is the single most important set of digits in your life, and it is gone now. What are we going to do? CEO Richard Smith is scheduled to testify before Congress on October 3rd.

What would you ask him if you were up there on the dais? I would say, whose idea was it that when you logged in to find out if your information had been breached, you waived your right to sue. Because, again, that is mind-blowingly idiotic. Whose idea was it that the one year of protection that you are offering to provide then just turns over into a permanent fee that you're imposing? Are you planning to make money off of this. And I would also, I have a friend who's an expert in cybersecurity who tells me that the single biggest problem in cybersecurity is that people are not upgrading immediately when they get the notice that security holes need to be plugged. I would ask them a lot of very detailed

questions about how they respond to that. And of course, I would ask them about this insider trading thing, because that's a disaster. Where is Equifax's board of directors on this? Because I think it was Jim Cramer on CNBC earlier this week who asked the perfectly logical question, what do you have to do to get fired these days? That is the perfectly logical question. And I think that the top management will be out very soon. But I would like to see some real changes on the board as well. And by the way, let's talk about Wells Fargo for a minute. I cannot believe that after all they've been through, that they still are releasing more information about, oops, we forgot to mention that there were some other bad things that we did and some other

accounts that we created and some other insurance products that we sold without telling people. And yet they have not had a complete redo of the board. So, I'm glad you mentioned Wells Fargo, because we had talked about that a couple of weeks ago, and one of my colleagues made the point, in reference to Equifax, he referred back to Wells Fargo and just said, you know what? This is one of those situations where, if this were a much smaller company, if Equifax were smaller, if Wells Fargo was a small community the feds would be kicking in the doors why what is it about yeah companies getting to a certain size where it's almost like well we're not really going to punish them well it's it's too big to

fail all over again that's exactly the problem there was a great documentary on frontline on pbs this week called abacus which is about exactly that situation uh one of the smallest banks in new york was the only one that was indicted uh following the subprime meltdown and they were ultimately vindicated and were found not guilty on all 200-some counts that were brought against them. But what Matt Tapie interviewed in that documentary said, there's too big to fail and they're small enough to jail. And it's just terrible. Jesse Isinger's new book, which we won't say the name because it's got a bad word in it, but his new book about why nobody went to prison after the subprime is definitely worth reading. I don't agree with everything he says

in it. But I do agree that we have a huge problem that the bank industry comes in and they create these loopholes and then they benefit from them. All right, let's move on from Equifax. Obviously, the big story of the last few weeks has been the impact of Hurricane Harvey and Hurricane Irma. Natural disasters can bring out the best in individuals. And we've actually seen some of that with businesses as well. Mattress Mac, which is the furniture retailer in Houston, opening up its showrooms as shelters is one example. Has anything caught your eye in terms of how businesses have responded to these storms? Well, you know, is it Coors that sent water? They stopped making beer and they sent water. I thought that was really great. But I think what has impressed me

more than the response to the storms is that in this upside-down world we're living in right now, it's business leaders who have been more forthright about the importance of responding to climate change than the government. Climate change was part of the focus of an event you just attended, the 2017 Public Funds Forum, sort of the increasing shareholder focus on climate change. How is that playing out in the investing community? Well, we had a real turning point this year with three companies that had almost two-thirds votes of shareholders. That's an amazing vote on climate change resolutions at ExxonMobil, Occidental, and PPL. And I think in part, it is because of a concern that the government

is not handling this problem anymore, and we're going to have to go at it through the market. And it's been interesting to me that as Trump pulled out of the Paris Accords and has put climate denial people into EPA and Interior, that it has been business leaders like Immelt who get up and say, no, wait a second, this is a real thing. What I thought was very interesting in the public funds forum was that it's not just about going after the fossil fuel companies. It's more about looking at supply chain issues and how they're affected by climate change

and also looking at business opportunities with climate change. Are people taking advantage of what is increasing customer concerns and customer openness to products that are useful? And I thought that President Clinton, who was our keynote speaker at this event, made an amazing point where he said that of all of the Indian lands that are profiting from casinos, he said that is a fraction of what they could make if they would open up their lands to wind and solar. Another topic covered at the conference seems like it was tailor-made for you personally, and that is the risk of having, quote-unquote, superstar directors on a board of directors. Yeah, one of my favorite presentations was from a former prosecutor who worked on complex financial cases,

and he said, I'm going to give you an example in the hundreds of millions, and then I'm going to give you an example in the billions and then I'm going to give you an example in the hundreds of billions. And so he took us through the Trump University case, the Theranos and Volkswagen. And particularly in the case of Theranos, he said the biggest red flag in the world is a superstar board. And you go in and you talk to them and they'll say,

what, meetings, votes, what? Yeah, huh? So, you know, nope, don't put Henry Kissinger on any more boards, please. It seems a little counterintuitive, though, because, again, on the surface of it, it would seem as though someone who is accomplished, whether it's Henry Kissinger or someone from the business world or anyone who has achieved some level of professional success in their life. On paper, you would think that's a good person to have in the boardroom because ideally that is a person who doesn't need this job, doesn't need the paycheck of being on the board, and therefore he or she is going to speak his or her mind, and that's what we need in the boardroom. Yeah, unfortunately that has turned out not to be true. In fact, we were joking at the conference that we used to say that the biggest cell signal in the world was a former Tennessee senator on the board because Howard Baker and Fred Thompson

and Al Gore Sr. had all been on boards that were disasters. And sure enough, there was one on the board of Theranos as well. So that may be something we want to track in the future. The problem is Henry Kissinger, who, of course, was on the board of one of the biggest disaster boards of all time, Hollinger, is that a lot of these people are used to kind of swanning in and shaking hands and going home. And that's why I keep emphasizing it's important to rate boards not on their resumes but on their decisions. And if they overpay the CEO, that's usually a good indicator that they're really not doing their job. All right, let's move on to movies. And the summer box office numbers were the worst in a decade. Even Wonder Woman could not save Hollywood this summer. When you look at that, do you think, well, this is the continuation of a trend that we've seen in terms of ticket sales? Or do you think, you know what? Wonder Woman aside, the slate of blockbusters this summer was generally pretty bad.

It was pretty poor, and they put a lot of money into movies like Baywatch. You remember that the last time I was on, I predicted that The Mummy was not going to do well, and it was a dumb, dumb, dumb, dumb movie. You know, the movie studios are really facing a conundrum, as they are now really at the tipping point of selling more tickets overseas than in the U.S. They find that witty, thoughtful scripts are not good overseas, And so they've really dumbed down the scripts. And that's why people ask all the time, why are television shows all of a sudden so much smarter than movies?

And the answer is that television is a writer's medium. The writers control the show, whereas in movies, the writer is at the bottom of the totem pole. And so movies, I've got to say, they're kind of dumb. You know, Wonder Woman was great. I'm delighted at its success. I'm disappointed that the movie that I was predicting would be a big hit this summer was a big flop, and that was Valerian and the City of a Thousand Planets. But that's another good example where the script was just not up to the level of the special effects.

They've got to find a way to fix that. But the fall has got all the big award movies coming down the pike, and we've got some very promising ones now. Yeah, that was going to be my last question. What are you looking forward to this fall, and therefore what should we be looking forward to this fall? Well, coming up very soon, and I've seen it already, so I can tell you it's great, is Battle of the Sexes, based on the real-life tennis match between Bobby Riggs and Billie Jean King.

And what makes that movie great is that it's fun to see that there were real human, vulnerable people in the middle of that crazy media circus. And in a way, it's funny that Billie Jean King's tennis group was sponsored by Virginia Slims, which seems absurd kind of now. But their theme was, you've come a long way, baby. And we have come a long way since then, but we've still got a long way to go. But I thought that movie was really well done. Steve Carell looks and sounds so much like Bobby Riggs.

It's eerie. It is. It is really disconcerting. And, of course, they got pictures of the real Bobby Riggs afterward and at the end of the movie. And you really do a double take. Corporate governance, movies, and that's why Nell Minow is our most frequent guest on this show. Thanks for being here, Nell. Bye-bye.

Up next, we'll dip into the Fool mailbag and give you an inside look at the stocks on our radar. This is Motley Fool Monday. Welcome back to Motley Fool Money. Chris Hill here in studio once again with Ron Gross, Jeff Fischer, and Matt Argersinger. The brand new edition of the Motley Fool Investment Guide is available now. You can get more details. Just go to book.fool.com. It is already a bestseller on Amazon. So, check it out at book.fool.com. Our email address is radioatfool.com, and our dozens of listeners coming through as they always do because as I mentioned

earlier in the show in a few days our man behind the glass Steve Broido will be getting his tonsils out and we asked the dozens of listeners for some advice for Steve and they did not disappoint from Wes Childress I had my tonsils out when I was 40 it took a full month before I was 100%

have someone take a picture of you pointing to the pain chart when they roll you out of surgery trust me it will be funny later from William Hoyle ask for the liquid pain medication. Talk a little bit as soon as possible. On the first day, I sang. It hurt like hell, and I sounded awful, so I didn't do it for very long. And finally, from Chris Weaver, I don't mean to scare you, Steve,

but I had my tonsils out when I was 23 years old, and it was the worst pain of my life. Oh, with that, have a good weekend, Steve. With that, have a good weekend, Steve. We're going to get to the stocks on our radar. Ouch. Steve will hit you with a really great question, because he's going to be out for a couple of weeks and won't be able to ask any questions. Ron Gross, you're up first. What are you looking at this week? How do I follow that?

Vail Resorts, MTN. Skiers will know it for its luxury resorts, Breckenridge, Beaver Creek, Whistler. They recently acquired Stowe. Interesting fact here, 2011 law signed by Barack Obama gave ski resorts the ability to add summertime activities. And Vail has been doing that slowly over time to lessen the seasonality of the business. As you can imagine, a ski resort is a very seasonal business. So, they'll be adding zip lines, mountain bikes, golf courses, rope courses that should help growth in terms of revenue.

Hopefully, that'll translate to growth in earnings as well. Stocks should have some nice upsides. Also pays a 1.8% dividend. Steve, question about Vail Resorts. Is there an age that you're too old to go skiing? I know that simple answer is no, but I'm not skiing anymore. I'm over 40. I'm done. That ship has sailed. I think you're more likely to tear something, break something, or sprain something, I think, once you're 35 plus. Jeff Fischer, what are you looking at?

I feel like I should recommend ice cream or something to Steve, but I'm going back to Oracle because it is down the most in four years this Friday to end the week. And this company's margins are going higher as it sells more cloud software. The shares look inexpensive at this point. And I think the long-term trajectory at the business is perfectly fine and the ticker symbol orcl steve question about oracle what does oracle actually do i've heard of oracle for decades now and i feel like i still have no idea what it does so it's one of the largest business enterprise software sellers in the world steve mainly it sells database software and software that lets you manage your human resources or your analytics or your governance all those sorts of things

There's many other things beyond that. So, it's software management. O' That clear it up, Steve? Yes. O' Yeah, sure. O' Matt Argersinger, what are you looking at? I'm pretty bearish on the railroads right now, and I'm particularly bearish on CSX, ticker CSX. It's one of the largest railroads in the world, but it's very dependent on coal, which for all intents and purposes is pretty much a dying commodity. Freight traffic in

general is slowing down. Hunter Harrison, who is a very successful manager, railroad CEO for many decades now. He was hired about nine months ago by CSX, paid $84 million, but apparently he might be stepping down soon because of health problems. He is 73 years old, stock trades for almost 30 times earnings, so I'd say stay away from CSX. Steve, question about CSX? Isn't transporting things via train the most efficient way to get things across the country? Still, cost per mile, it's almost nothing. No doubt it is. But what I'm worried about is just the amount of stuff they're

going to be able to haul soon when they're so dependent on commodities and other things that are just, the demand is just plunging. CSX, Oracle, Vail Resorts, three very different companies. Steve, you got one you want to add to your watch list? I might take a look at Vail Resorts in the summertime. Sounds like a nice place to be. Steve, we wish you all the best with your recovery, and we will check in with you at some point. When it comes to milkshakes, which you'll be, I'm assuming, consuming a lot of over the next few weeks, what's your go-to flavor?

Well, you know, they say to stay away from dairy, oddly enough, so there won't be probably any milkshakes. There'll be protein shakes, because I've got to keep my girlish figure. All right, Ron Gross, Jeff Fisher, Matt Argersinger, guys, thanks for being here. Thanks, Chris. That's going to do it for this week's edition of Motley Fool Money. Our engineer is Steve Broido. Our producer is Matt Greer. I'm Chris Hill.

Thanks for listening. We'll see you next week.