Motley Fool Hidden Gems Investing - Meme Stocks Mania Returns & the Fantasy Stock Draft

Episode Date: July 25, 2025

Meme stocks had a huge week, earnings season got into full swing with Alphabet going big on AI, and we draft our top stocks in the S&P 500 today. Travis Hoium, Lou Whiteman, and Emily Flippen discuss: - Meme stock mania returns - Alphabet’s $85 billion AI bet - Fantasy stock draft - 60-second earnings takes - Radar stocks Companies discussed: Alphabet (GOOG, GOOGL), GXO, UPS, Accenture (ACN), Truist (TFC), Tyler Technologies (TYL), Lululemon (LULU), Chipotle (CMG), Apple (AAPL), Alphabet (GOOG), GM (GM), MGM Resorts (MGM), Garmin (GRMN), Chagee Holdings (CHA), Intel (INTC). Host: Travis Hoium Guests: Lou Whiteman, Emily Flippen Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. Learn more about your ad choices. Visit ⁠megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

The memes of the market were back in control this week. Motley Fool Money starts now. Everybody needs money. That's why they call it money. The best things in life are free, but you can give them to the birds and bees. From Fool Global Headquarters, this is Motley Fool Money. I'm Travis Hoyum, joined by longtime Fools, Lou the Legend Whiteman, and she only has to survive the next hour with us, Emily Flippen. Today, we're going to talk about the latest in AI, the opening of hedge funds to more investors, and we're going to draft our favorite stocks on the market.

But we're going to start with a meme stock mania. In early 2021, GameStock became kind of the first meme stock that really went viral. The idea of an individual stock going crazy isn't new, but this is really retail acting differently to squeeze the market, if you will, in a bunch of different ways. And it looks like we're back this week. We saw Opendoor, GoPro, Krispy Kreme, and undoubtedly another meme stock craze. I mean, when you think about these frenzy, they're really just bouts of coordinated crowd behavior. And these traders will pile into names with really heavy short interests, not because they love the business, although, of course, I do love a Krispy Kreme donut, but really just to punish the hedge funds that are betting against

it. And the targets, especially you can look in this case, usually deserve those shorts, like Opendoor, GoPro, Kohl's. They've all had really clear operating issues and just faced really big headwinds. But prices can still skyrocket once that craze begins and those shorts start to get squeezed. But interestingly, as much as we like to blame Reddit and Robinhood hype for why retail investors do this, what's really going on and what's really driving this is actually the way the market just fundamentally works in this day and age. Multi-manager hedge funds, they're called pod shops. They largely force each sector manager who operates within that hedge fund to be long one name and short another so that their overall book stays market

neutral. And that would be the hedge in hedge funds, right? Exactly, exactly. So you have to manage a certain level of volatility for these types of businesses. And the issue comes in when you look at how much pod shops are driving the market. I mean, they're responsible for upwards of a third of all U.S. equity volume. So you can understand how retail traders look at this dynamic and they think, that's kind of BS. I want to do something about that, right? And this exaggeration can occur around earnings season, especially when you start to have all of these volumes flooding in, selling the bad companies, buying the good companies. And with that quarter of volume of U.S. equity markets that are driven by retail traders,

it's really easy to see this dislodging of fundamental value as a result. It's weird, isn't it? And I have to be honest, it isn't anything I want to be a part of. My favorite part of investing is you don't have to play in every game. You don't have to buy every stock. And I can't predict human behavior. Fortunately, I don't have to. So as a long-term investor. I kind of just am watching this and all. I mean, my tendency is to look for places that others are ignoring. I think you can find good value with stocks that really aren't bad. They're just not getting attention. And so in a way, I love this because in the middle of a frenzy like this, when all of the attention is going on just a couple of stocks, I'm looking

at areas like transports, like financials that have been beaten down, and I see signs of life and just kind of say, hey, no one's paying attention. But two things you got to remember if you are caught up in meme stocks. First, it works until it doesn't, right? And there's no signposts at the top, as they say. The sad final chapter of the 2020 meme craze is the gains didn't hold, and a lot of people that felt rich for a bit ended up kind of back where they started. The problem with timing the market is you have to get it right twice, and that is really hard. second related your friend or co-worker whoever is only telling you about their wins in moments like this it's easy for FOMO to set in it feels like everyone's getting rich but you

but look there are two sides of every trade you're only hearing half of the story at most so just be careful as that FOMO comes in I actually love that Lou because when you look at this for long-term buy and hold investors which I hope everybody who is listening to us right now associates themselves with a long-term buy and hold investing, which as we know, benefits over the long-term better than trying to day trade or staying uninvested in the first place. What your point about the fact that you only hear about the good things, not the bad things, is incredibly poignant. Because to be a long-term investor, you don't have to buy every single company. Of course, you could buy an index fund and that's to some effect doing the same thing,

but you don't have to get every single opportunity right. You just have to have a systematic and reasonable approach to managing your investments. And this is exactly the opposite of that. So it's important not to get caught up with it because as we know, this is the best, easiest way to lose your shirt. Emily, I want to ask you about how you would maybe take advantage of this and then we can get lose take. But one of the things that we always talk about long-term investing, and if you are a long-term investor and you found an opportunity in, I mean, GameStock originally was a value stock. That was a company that there are fools who built positions in that when it was trading for single-digit earnings, and that was kind of where the whole thing started.

But if a stock that you own, that you have a long-term thesis on, goes through one of these meme crazes, is that an opportunity to sell? Or how do you think of it if it's sort of a tailwind for you? You're not necessarily a buyer at the top, but do you want to kind of get out? Or how do you think about that? That's a great question, because the benefit, as we talked about, to something like this meme stock craze, or even the hedge fund involvement, which is longing and shorting certain companies can lead to dislodge of long-term value, right? Where the perception of value for a company is different than the price of the market. And as investors, that's always what we're looking for. So there can be instances where somebody is a shareholder of a

business that otherwise undergoes a meme craze, and they didn't buy it with the intention of the stock going up 100% overnight, but they wake up in the morning and they find themselves in that position, which is why it's so important to have a fundamental thesis for why you're buying a company in the first place. And in the case of a business like GameStop, of which many fools did own positions prior to it going crazy just a few years ago, you have to ask yourself, okay, when I bought this investment, what was my perception of value? What was my thesis? And how is today's value different than what I perceive their value to be during the thesis? And sometimes that may be, hey, sure, maybe it's gone up 50%, but I think this is a stock that is

worth 200% more today, right? And it doesn't matter to me what the retail investors are doing. I have my thesis. But I think in the most cases with businesses that have been struggling like these meme stocks have been, chances are when they go up a hundred plus percent, that is a great opportunity to sell because that has that relative value that you saw when initially purchasing that dislodge no longer exists. Amen. Don't, don't get too greedy. If I bought something at 10, believing it could go to 20 and suddenly it's at 50, I think I should say, thank you very much. Probably a good way to look at it, at least take a little bit off the table. Retail investors, in other words, you and me are driving

the meme stock rally. And that may show how some investors are using the market as a casino rather than a long-term investing mechanism. So why not up the stakes? This week, the House passed a bill that would expand the definition of accredited investors. Emily, I always get confused about these rules. So what exactly is an accredited investor? Well, for some people, being an accredited investor can just mean that they have a certain career in financial management, right? They work for a hedge fund or they pass a series of tests to manage assets and work in that professionally. But for the vast majority of investors, people listening to us talk right now, to be an accredited investor, you need to have more than $200,000 in earned income as a single

person, more than $300,000 in earned income as a married person, or have a net worth north of $1 million, excluding your primary residence. So until now, that criteria was really only financial. And this bill would add, quote, certain licenses, education, or job experience to the criteria to qualify as an accredited investor. There's a long history of these rules changing, and sometimes they're for the better, sometimes for the worse. Lou, what's good here and what's bad? In theory, choice is good. More options is better than fewer options. The good news is more people will have more options available to them. But let's be honest, this is an industry with a long history of inventing products

designed to get the industry rich, not the customer rich. While I do believe it is very possible for an individual to outperform the market, it is also worth noting that the no-choice option. People who spend their entire working career buying a total market fund and nothing else should be just fine. So there's a lot of noise. There's a lot of selling here. So kind of the bad news, my maybe over cynical take is I do worry that some of what will be sold to these newly minted accredited investors will be not worth buying. I'm definitely not trying to play chicken little and say it'll all be bad. I mean, there will probably be opportunities, But the downside of having more choices is inevitably some of those choices are the wrong

ones or the bad ones. Yeah, that's a great point, Lou. And I have to say, I do think the devil's going to be in the details here. Of course, the bill that the House approved this week just doesn't really give us a lot of details. They give suggestions for what this could look like, but what it actually means to be taking a test and being able to be accredited regardless of net worth, that is ultimately going to probably drive how much of this is protecting individual investors versus just throwing them to the wolves, so to speak. But I do think that conceptually, this is heading in the right direction. I like to broaden and expand my viewpoint here and think about how it felt when the internet started to come around and people were able to make trades

on the internet as opposed to having to call up their broker. And I could have made a very similar argument in that day and age that it was bad for investors and individual investors in particular. And certainly, we did see a huge rise in penny stocks, right? Everybody was suddenly trying to get individual investors to buy into these really defunct companies. And a lot of people lost their shirts. But here we are decades later, and I think we can all say that the market is more efficient. We're all better off as a result of the ability to place free, easy access trades over the internet. And I wonder if this has to be the same thing. We're seeing companies come to public markets much later in their life cycle than we have in the past. That's diluting overall equity returns.

A lot of great investment opportunities do exist on private markets, for which a lot of people do not have access to today. And as important as I think it is to have strong regulations that protect people from effectively being robbed, right? They're being scammed by private investments that don't have great regulatory oversight. I also think it's really important that we open up access to the average person. Otherwise, they could potentially be left behind. Yeah, it's interesting, the historical context. You went through some of that, Emily. I'm reading the power law right now, which goes through some of the history of Silicon Valley. And it's just fascinating how the VC infrastructure that has helped build companies like Google,

Amazon, Microsoft, Nvidia, Tesla, it just didn't exist 50 or 60 years ago. And the funds that are driving that wouldn't have been possible or legal. And as the rules are currently written, it would be extremely difficult to start a small fund without hundreds of thousands of dollars in capital just to pay for regulatory fees. So sometimes there is a purpose and sometimes this is, you know, regulations are saving themselves from us. But Lou, what's the big takeaway here? The big takeaway is, you know, be excited, but be careful. Like I say, there is going to be good opportunities. And Emily's right. There are a lot of things I'd love to invest in, but there are also always read the fine print, always think of expenses, always figure out if

you're being sold because there's just a lot out there and not all of it is going to be a good choice, even if it is a choice you have. Next up, we're going to discuss the ups and downs of big tech today. You're listening to Motley Fool 1. firmer or softer. Adjust cooler to warmer. And right now, save up to $2,500 during our massive Labor Day event. Hurry into your local Sleep Number store today, because we have your number. Artificial intelligence has obviously driven the market over the past three years. NVIDIA is now the most valuable company in the world. But Alphabet was the talk of the market this week with its AI progress. They doubled tokens processed over just the last two months.

Gemini now has 450 million monthly active users. Then they upped their CapEx by $10 billion to $85 billion this year. Lou, Microsoft planned $80 billion in CapEx and they'll report next week. So we'll find out if they're going to also up the ante. But did Alpha just throw down the gauntlet with going all-in on winning this AI race? Yeah. It's funny. It'll be interesting to evaluate the Alphabet number in a week or two when we see what their rivals did. But I don't know if this is all-in, considering they have all the money in the world. Here's what I think with Alphabet. Ever since Ruth Porat stepped in as CFO back in 2015, the company, in my eyes, has been extremely disciplined about allocating cash. They're

not conservative. They still do a lot of other bets, but they're very smart about it. Porat isn't CFO anymore, but she's still in leadership. I trust the company more than most of the MAG7 that when it comes to capital allocation, if they say they're investing based on what they see as concrete returns they can get from it, I think I believe them. Yeah. I mean, I'm a little more skeptical here. I will say, I think there could be a misperception that money equals success when it comes to artificial intelligence. And if that were the case, then I should be a sommelier with how much money I spend on wine. But the truth is I can't tell a difference between most of what I drink. And so in this case, I really do think that the winners of AI are going to be the people and

the companies that can derive the most value from it, not the ones who can throw the most money or value at it. And right now, large tech companies keep talking about their CapEx as if they're getting this great return on investment from it. And we simply have not seen that ROI come to fruition yet. Now, big emphasis on yet, because their backs in a lot of cases are against the wall. What are they supposed to do? Just pretend like this big sea change isn't happening to them? No, of course not. But I will say when I see big numbers like this, I have to wonder, where is the value accruing to? Is it going to mainly accrue to the companies that are spending tens of billions of dollars on CapEx and AI? Or is it going to be the companies that actually

partner with the companies spending tens of billions of dollars on AI who actually get to use the end results in this product. So I do think there's a dislodge of value between these large companies and the smaller, small caps that are likely to partner with them, put up less capital and still get a lot of value. One person that may disagree that money is all it takes is Mark Zuckerberg. He has been firing eight, nine-figure job offers out of a t-shirt candidate, AI Engineers. Like Alphabet, Meta has more cash than it knows what to do with. So is this a sign that they're worried about something? Is this Mark Zuckerberg saying, you know what, the balance sheet and the cash is all that matters? I'm interested in your take, Emily, but I want to

start with Lou, because Zuckerberg seems to be taking a strategy of, we've got to be in this game, and he might be right. Zuckerberg, I think, is being Zuckerberg, right? His nature is to be overly aggressive. It's worked at times, like buying Instagram instead of competing with it. It has not worked as well in other times when they went all in on the metaverse. Obviously, this time, unlike the metaverse, they're not rushing in alone. I think the market is giving them more of a pass here. It is, as you say, I think it's a cost of business, not a Hail Mary pass. But to Emily's point, and the interesting thing to me with Zuckerberg shifting the focus to hiring, are we getting to a point where we are approaching, we have enough capacity,

enough chips, and the investment starts shifting to how we use that capacity? I mean, I don't think this is all or nothing. I'm not like calling gloom and doom for NVIDIA, but I do wonder if we'll look back at what Zuckerberg's doing here and some of these investments in companies and say, okay, that was the beginning of the shift from exponential growth in chip demand to just a plateau and the money started allocating elsewhere. Yeah, I agree with Lou here. And I will say, you know, expanding larger for meta, which I, by the way, I think is an incredible company, has been an amazing investment. And I'm happy have exposure to it via all the index funds that I own. But I will say this, tell me the one thing

Meta has done since buying Instagram that has actually helped cash flows here. They don't take apart their balance sheet, their income statement on a per segment basis, except for when it applies to Reality Labs. And I will say we see with Reality Labs, despite all the capital thrown in it, has just not generated the returns they expected for the Metaverse Ambitions, which they renamed their company for. Reality Labs actually as a percentage of sale has shrunk over the last couple of years. And it's the same as it was in 2020. So it really hasn't been a massive driver of value for Meta. And I will say, I think this is throwing money at the wall and seeing what sticks in the case for Meta, which is to say that they have a lot of capital. They don't get a lot

of shareholder pressure here because their other businesses are so cash generative. And I think they need to be a little bit more focused on a per project basis of what's driving return on investment. Because right now, it seems like they're just doing the most. And I don't mean that as a compliment. One company that's not driving a lot of return on investment today is Intel. They announced massive layoffs, and this is not the first time that they've announced big layoffs. But this week, they said that 24,000 people are going to potentially lose their jobs, about 15% of the staff. Lou, what is going on here? Is this something that's going to be a bigger problem for the tech industry broadly? This was CEO Lip Bhutan's first quarter as CEO.

And if nothing else, I think what we're seeing here is he was brought in to shake things up, make the company more efficient, question everything, and, you know, cost cuts would be expected. To me, and to relate this back to AI, the most interesting thing about Intel was their commentary on Foundry. Foundry was supposed to be their way to compete with Taiwan Semi and get some of this business that, you know, the NVIDIA chips and all that, kind of the third party. Up until March, when time took over, the conventional wisdom inside Intel was Foundry is the future. All emphasis was on Foundry. Now, the commentary is basically, hey, Foundry's got to prove itself. For better or for worse, I think TAN is beginning to question

everything in Intel. Fair to say the company needs a reboot. The hard part isn't the flush, it's figuring out what direction to go from here. We'll see, but I think it's a good first step. Next up, it is almost fantasy football season, and we're going to come back and draft our favorite stocks, you're listening to Motley Fool Money. NFL training camp started this week, and that means it's time to start preparing for fantasy football. So we thought it'd be fun to do a investing draft, something of a fantasy investing team. Here's the rules. We're going to pick four stocks. This is going to be cumulative scores. We're going to try to beat the market by as much as we can and only pick stocks in the S&P 500.

And we're going to have a snake order with Emily starting first and Lou going second. Emily, what are you starting with? Well, I just want to say, I want the record to show that I resent this ask just a little bit because I am limited to the S&P 500 stocks. And some of my favorite companies are small caps or businesses that otherwise don't qualify to be added to the S&P 500. Now, I will say, I understand the ask. But I do think when I look at the performance of an index like the S&P, I have to look at the MAG7. And I have to benchmark against those businesses because they have been the behemoths that have driven overall index returns. So I will say, I will mix it up a little bit here. But my first one, of course, has to be Apple. Out of all the

MAG7 stocks, this is the one that I think has some of the lowest expectations baked into it, that when I expand performance out for a full year, I think it's more likely to surprise investors. So this is fun because I'm going to take the other side of this trade. My gut is over the next year, the MAG-7 isn't going to be what leads the market. The one year is really hard though, because it really is. My brain goes to situations. My first pick is GXO Logistics. I might get to it more in a little bit, but I'm going to favor things like transportation that have really been beaten down by tariffs, by supply chain concerns. I think that there is a near-term catalyst for these sorts of companies to outperform over the next year. I have two picks here. You guys left

the easy one on the table. That is Alphabet. We talked about it already. They are just crushing it in artificial intelligence. Their cloud business grew 32% last quarter. They have enough money to just bludgeon the competition in artificial intelligence. Trading for less than 20 times forward earnings. That's even before analysts start adjusting their estimates for the next year or two. I think that's just the easiest pick and you get a pretty good value. Speaking of value, my second pick and the first of the second round is going to be, look, I think the market overall is pretty overvalued. So given that, I want to look for some value stocks. General Motors continues to, despite everything, despite potentially weakening consumer spending,

despite tariffs, they're still going to make a ton of money this year and they're buying back 15 to 20% of their shares outstanding every year. If the stock doesn't go anywhere over the next year, you could just own 20% more of GM than you did a year ago. I think eventually that will pay off and maybe it'll be this year. Lou, you're up next. I'm staying with my transports. UPS has basically been cut in half in the last few years. It's still a good business. They did have headwinds, but I do think I'm ready to call a bottom. Little nervous if it will recover in 12 months versus 18, but I'm going with UPS on a recovery in transports.

And I'm sticking with my good old consumers, and that is Chipotle. We had earnings out from Chipotle this week that really disappointed the market. In fact, I think the past year has seen a lot of the enthusiasm for Chipotle and its relative perception of value fall. And as a result, I actually think

that this is one of those businesses that can pleasantly surprise investors. it's an affordable luxury in a tighter economic environment. And I think they're likely to see more resiliency as it applies to their core customer than a lot of investors are giving them credit for right now. You get two picks here. So what's the second one, first pick of the third round? Oh, let's go with another consumer company here, Travis, and that's Lululemon. Now, I hear everybody smacking their heads as they listen to me say that, because this has been such a dog over the course of this year.

Obviously, they sell very expensive athleisure apparel, and there's a lot of competition in space and a lot of skepticism over their business. But again, this all comes back down to expectations. Lululemon has not been this cheap since the Great Recession, and their brand is just as resilient today as it has been during any decade in the past. So I think this is also one that's likely over the course of the next 12 months to surprise investors to the upside. I'm going to switch gears a little. Accenture, ACN. This is not a climate where anybody wants to commit to big, expensive consulting projects. But we talked about AI. Everyone's scared of AI and what it's going to be. Not everyone can invest what Google and Meta is investing,

so they need outside help. I think as some of the hopefully clouds clear on tariffs and where the economy is going, I think we're going to see an uptick in businesses focusing on how they can use AI. Hiring Accenture, I think the stock can have a good year. Accenture is kind of like the easy button for companies in artificial intelligence, it seems. I like easy buttons. I have two picks here. I'm going to go with the value trend once again, a company that I think the market is just overlooking. Another buyback stock buying about 15% of their shares outstanding each year, MGM Resorts. This is a company that owns about half of the Las Vegas Strip. They have two casinos in Macau, which is actually the biggest market in the world. And oh, by the way,

they're building what could be one of the most profitable buildings in the world in Japan that won't open until 2030. So the market doesn't tend to care about that sort of outlook five years from now quite yet. But if you believe management's estimates, you just pull out some of their China business, their Macau business, and their online gaming partnership with Entain. Their core business trades for about four times the cash that it's generating. So that, I think is a phenomenal value and the Las Vegas strip isn't going anywhere. Uh, they're, they're not building a lot of new casinos. And I think, you know, 10, 20, 30 years from now, the Bellagio is still going to be at that core. So I like the value there, uh, in the S and P 500, the

final pick for me is going to be one that I think has just been overlooked for years. That's Garmin. Uh, if you are a Garmin watch where you know that this is just one of those companies that can command phenomenally high prices. They have all the information. They have a fascinating 10 years coming ahead because as we move to more wearables, companies like Meta get into glasses and things like that. Here's this device that's just sitting here waiting to be utilized more. People are paying $1,000 plus for a lot of these watches. I don't know, am I going to be able to use artificial intelligence? Am I going to be able to plug this into my healthcare app? There's a lot of opportunities for them. Not the cheapest stock

at about 30 times earnings, but I just love where they're going. And the vision for the company, the founder-led company, has been phenomenal over the last few years. Lou, you're up. So one of the areas the market really hasn't liked was mid-sized banks, regional banks. And a bank that the market really hasn't liked is Truist Financial, TFC. Truist is the product of a merger. They didn't do a great job on the merger integration, so some of that lack of love is justified. But I think the integration is behind them. They have about $45 billion worth of loans that roll off in the second half. Most of those are rolling off from zero rate period, so it should be an opportunity to reprice. I like a near-term catalyst. I like

a good bank trading at below book value. I think it can outperform from here. And for my last stock, I had half a mind to go with another MAG-7, but the truth is, I really love some underappreciated constituents of the S&P 500, of which Tyler Technologies is one and we'll make up my last pick. You know, Travis and Lou, have either of you ever heard about or looked at this company before? Yeah. This is the first time I've heard of it, but yeah, this seems like a blue dally. Well, I'm impressed because this is a company that not a lot of people are familiar with, but they provide software services and payment processing to small, local, and regional companies, or excuse me, small, local, and regional public sectors. So

like your local government or your state governments, they made an acquisition of e-gov a number of years back, which got them some federal exposure. And they're operating in an industry that's just really massively underserved. And as a result, it means that they don't have to have this incredible product because the thing they're replacing is really just pens and papers and they're incredibly sticky. So this is my pick to kind of lower the overall volatility of this portfolio. Let's put you both on the spot and try to find a coach for our teams. I think I thought it's always fun to think about a CEO running any company. Lou, who would you have as the CEO running this company of your four stocks?

So maybe it's recency bias because I was just looking at Kinsale Capital's results. But Michael Keogh at Kinsale is just, he's a founder with a vision and has executed for a long time now. That's front of mind. I'll take him as the coach. I will say, Travis, you did tell us that the CEO had to be a CEO of an S&P 500 company. I didn't, no. So I went outside the box here and I actually, I'm running with Bom Sook Kim, who is the founder and CEO of a company called Coupang. Coupang is a Korean e-commerce company, sometimes referred to as like the Amazon of South Korea. And the reason why I love him so much as a leader is because he has a very high level of operational expertise. And I love the way he talks about deriving

shareholder value. And most importantly, I think the best thing that a leader needs is the ability to recognize when mistakes have been made and to change course, to be flexible and open-minded. And when Coupang attempted to expand into Japan, that initiative within a first year or two failed pretty spectacularly. And Bombsuit Kim was not afraid to come out and say, okay, that didn't work. We're stopping wasting our money by attempting to make this expansion there and focusing on back on our core competencies as opposed to dumbling down just to save face. So I'm running with Bombsuit Kim here. I've got a lot of value companies. I went with an execution person. I think what Mary

Barra has done at GM has just been phenomenal. Obviously, it's one of the stocks that's in my group here. But she's just been in a very, very difficult market, continues to generate cash, continues to have really good products coming out. The market doesn't really seem to care. But I think if you're looking for a company to run companies where operations are going to be the focus she has done a phenomenal job let's put some time on the calendar next july to check in and see who won uh and we will maybe put this up on the motley fool twitter page as well you can let us know what they're what you have picked but in the meantime dan behind the glass is going to be has been judging our picks dan what do you think of our teams and who has

the best team here okay so i'm not a stock analyst let's just keep that in mind i think all of you did a fantastic job so i'm just gonna split a few hairs here uh emily i liked all your picks except lululemon i i don't know i don't i don't think it has legs heyo uh so i'm gonna give you an a minus uh lou i liked all your picks except for truest because i don't like the name so i'm gonna give you an a minus and travis i liked all your picks uh i don't gamble so except for MGM Resorts. So I'm going to give you, you guessed it, an A-. You're not wrong on the name. You're not. And it's clearly grading on a curve here. Next up, we are going to give you 60-second takes on some earnings this week and stocks on our radar. You're listening to Motley Fool Money.

Time's gone by, it seems to be You could have been a better friend to me Mama, I'm coming home You took me in and you drove me out Yeah, you had me hypnotized, yeah Lost and found and turned around 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 stocks based solely

on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. We're in the heart of earnings season, so I want to put the three of us on the clock with some takeaways from earnings this week. Emily, in 60 seconds, what is one earnings report you think has a big takeaway for investors? I have to think about Boston Beer here, and this was actually a strong quarter for them. Stocks up a bit after they reported sales growth of 1.5%. And a lot of that comes down to how they're managing costs. Their gross margins

actually expanded year over year because of efficiency derived from their product mix. And that production has actually helped absorb the cost of tariffs. So there's a nice combo of low expectations for Boston beer and a mild beat. But they're still facing tariff headwinds. I think there could be headwinds of up to 100 basis points over the course of the next year that they won't be able to probably pass along to consumers because they're already raising prices so much. So this is a business that otherwise seems strong. I mean, they're continuing to buy back shares, generate a lot of cashflow, but fundamentally this is like a fine business operating in a bad industry right now. And you have to think that that just kind of makes a bad

business. It's not just beer consumption that is down. I mean, alcohol consumption across the board is on a decline. And while I'm really impressed with what this company has done, given the premiumization of their alcoholic tea and the Sun Cruiser brand, these like one-offs aren't going to fix their company. I pray that at some point, management just sees the light here. They keep talking about what it means when their industry will improve. That is an exact quote from their earnings call. They expect the industry to improve. Quarter after quarter, alcohol consumption and beer consumption declines. The industry is not improving. But you know what people are going towards? Cannabis and others. They're taking hundreds of millions of dollars and buying back

their own shares instead of actually investing in something that is a growing industry. I really wish that this company would take a broader look and think, how do I make sure that Boston Beer is relevant a decade from now, as opposed to just accepting their business as it exists today? Speaking of companies in bad industries, Enphase makes microinverters that convert energy from solar panels to AC current we use in our house. It has been a tough stock to love, down 70% over the past year. Look, not without reason. Arguably, the current political climate in the U.S. is not favorable towards solar. A lot of the tax incentives that were supposed to fuel residential solar growth, they're disappearing as part of the big, beautiful bill.

And yeah, shares were down another 10% on an earnings release where Enphase said the U.S. residential market is going to shrink by 20% in the next year. But looking at these earnings, they actually top quarterly expectations for both earnings and revenue. Some of this could be a pull forward, people trying to get systems installed ahead of those tax credits running out. But I also think it's a sign that there is just kind of expectations aligned with reality and we can stop with the maybe quarter-to-quarter drama. Company's doing what it can. European sales are up. Enphase is pushing new products that don't require big tax subsidies like balcony solar systems to be used in an emergency. As a shareholder, I walk away from this quarter both

with little reason to get excited in the near term and surprisingly not concerned given how much the holding is down over the last year. If solar ends up being a big part of the long-term answer here, and I still think that's likely, there is nothing to suggest Enphase won't have a big part to play in that transition. It's just going to take a lot of time. That Balcony Solar product is going to be really interesting to see. The one that I think that we need to pay a little bit more attention to, if you're interested in autonomous driving. Mobileye beat their estimates for the quarter, increased their guidance. And then they also said that they're going to be launching in 2026 some autonomous vehicles

here in the U.S. They have been testing those for quite a while. So keep an eye on Mobileye if you're interested in autonomous driving. Now, we like to end the show with stocks on our radar. Emily, I'm going to start with you. What are you watching this week? I'm looking at a company called Chaki Holdings. The ticker is CHA. This is relatively new to public markets, so probably a new one for a lot of listeners. But this is a rapidly growing collection of upscale tea houses and bars, largely in China, although they are expanding across Southeast Asia and even the United States as well. This is run by a founder-led management team who's still relatively young, and they have massively expanding business.

Now, there are some red flags here. This is a franchise model, and same-store sales growth is declining as a lot of cannibalization happens across their massive expansion. But it is sitting at that $5 billion-ish sweet spot when it comes to the market cap of some of these fast casual chains. And we've seen the success in the number of stores that can be held up by a large market in China. They have a higher price point, which has improved profitability. And this is an incredibly profitable cash-generative company growing really rapidly. Definitely one to keep on your radar. Dan, what do you think there? Yeah, Emily, another reason for the listeners to dislike me, but I'm a big tea drinker. So this is exciting to me. Do you have a favorite type of

tea you like to drink? I'm actually a loyal coffee enthusiast, but I will say the majority of what Chagi sells are actually tea lattes, like milk-based teas. So really not what you would imagine when you think about a classic tea. Lou, what are you looking at this week? I mentioned it before in the draft, but GXO Logistics, it's a backdoor way to play the continued growth in e-commerce and omnichannel commerce without having to pick winners and losers among retailers. The company runs warehouses, the supply chains, and handles returns for Apple, Nike, Whirlpool. Apple built a million-dollar warehouse and just threw the keys at GXO and say, it's your problem. The stock has underperformed in part because it has a major European exposure

and Europe hasn't done as well as the U.S. for the last few years. It was also waiting antitrust approval for a big deal. Europe is picking up. The deal is finally closed. They report in early August. I'm really curious if these headwinds turn to tailwinds and we start to see some life in the stock. Dan, is logistics an area of the market that you have any interest in playing? I mean, you have to say yes to that, don't you? Because companies like GXO are kind of behind everything that we consume and everything that we do around here. So yeah, I'm interested in logistics. But my question is for Lou. Lou, do you have any warehouse experience in your job history? No, I've visited them. Does that count? I got to see a cool robots demonstration. Which

is that if that counts? I think that does count. Everybody likes cool robots. All right, Dan, which of these stocks are you going to put on your watch list? Well, as much as I like cool robots and logistics, I'm actually going to go with Chaggy because you know what? I'm a little thirsty and i think i'm uh thinking about my next cup of tea here travis for lou whiteman emily flippin dan boyd behind the glass and the entire motley fool team i am travis holland thanks for listening to motley fool money we'll see you here tomorrow