Motley Fool Money - Best & Worst of 2022

Episode Date: December 16, 2022

Time to hand out some awards! (0:21) Ron Gross, Emily Flippen, and Jason Moser discuss: - The biggest business/investing stories of the year - Who gets their vote for CEO of 2022 - Some of the dumbest investments of the year - How semiconductors and a stock hitting an all-time high flew under Wall Street's radar (19:11) Ron, Emily, and Jason continue our year-in-review special with: - Surprising years from Salesforce, Axon Enterprise, and Campbell Soup - Things they didn't have on their 2022 Bingo Cards - New investing discoveries - Three stocks on their radar: Booz Allen Hamilton, NextEra Energy, and Topgolf Callaway Stocks discussed: TSLA, TXN, ULTA, BBBY, K, CASY, OM, AXON, CPB, CRM, BRK.A, BRK.B, DIS, DOCU, NFLX, BAH, NEE, MODG Host: Chris Hill Guests: Ron Gross, Emily Flippen, Jason Moser Engineer: Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi everyone, I'm Charlie Cox. Join us on Disney Plus as we talk with the cast and crew of Marvel Television's Daredevil Born Again. What haven't you gotten to do as Daredevil? Being the Avengers. Charlie and Vincent came to play. I get emotional when I think about it. One of the great finale of any episode we've ever done. We are going to play Truth or Daredevil.

What? Oh boy. Fantastic. You guys go hard, man. Daredevil Born Again, official podcast Tuesdays, and stream season two of Marvel Television's Daredevil Born Again on Disney Plus. It's time to hand out some more. Awards. Motley Fool Money starts now.

Need money. That's why they call it money. Cool Global headquarters. This is Motley Fool Money Radio Show. I'm Chris Hell. Joining me in Studio, Senior analyst, Jason Moser, Emily Flippin, and Ron Gross. Good to see you all. How you doing, Chris? It's been a while since we've had four in this year. Nice. Nice. Taking me back away. And just in time for our Year in Review special. In two weeks, we're going to have our investing preview for the new year. But right now, we are going to tie a

on 2022. Ron, let me start with you. What is your business slash investing headline for the year? For me, Chris, it's all about the non, I repeat, non-transitory nature of inflation. And the interest rate increases the Fed is undertaking to combat it. This, of course, has led to higher borrowing for all. You can see it in mortgage rates most prominently. Indication that inflation is moderating, but this week the Fed made sure everyone knew that their foot was still on the gas, but perhaps not peddled to the metal because they only raised interest rates by 50 basis points this time around. So here we are in this cat and mouse game, inflation, interest rates, possible recession. So, you know, 2023 is going to be a good time.

The word transitory really took a beating this year. Emily Flippin, what about you? What's your headline for the year? My headline's all about the non, and I repeat, non-transitory invasion of Ukraine. A little darker, but I will say. I think that February invasion really set the stage for a lot of the dynamics that we saw throughout the course of 2022 with our global markets. You know, Ron mentioned inflation, interest rates. A lot of that was catalyzed by the energy crisis caused by Russia's invasion, a refugee crisis in Europe, the devaluation of the euro, and just the unpredictability that physical violence

has on the global markets and the risk tolerance of investors. This is such a protracted invasion. This conflict has really lingered over the world. world's head for the better part of the last year, and it's impacting the markets and ways that I think investors, when they started off 2022, could have never predicted. Jason, what about you? Well, stop me if you've heard this one before. Stocks extend losses as recession concerns mount, because I feel like I've read that headline probably 200 times this year.

And if not recession concern, recession fears. Looming. And I mean, that really, to me, that has been the theme for the year. It's understandable. I mean, some would argue, and I don't necessarily agree with it, but some would argue at least that we witnessed technically a recession earlier in the year because we did see two consecutive quarters of contraction. But with a stronger employment picture, I think that we've been able to kind of skirt through actually falling into a recession. But the question really is going forward. What does that look like? And it feels like the going money is that we are going to witness a recession in 2020. The consumer, we're seeing a lot of signs of the consumer being stretched.

We have 60% of folks now living paycheck to paycheck versus 56% a year ago. Personal savings rate at 2.3%. Now, you've got to go all the way back to July 2005 to find the lower personal saving rate. And now we're seeing the big bank CEOs as well talk about the stretch consumer. Just a month and a half ago, they were talking about the consumer being in a good place. So it's all to say that, yeah, it feels like 2023 might get off to a, a rest of a rough start. My hope is that the Fed's actions will start to take hold. We'll see inflation of date. We'll see the labor market tighten a little bit there. Maybe we see a stronger back half of

2023. CEO, CEO, Nicky Sparshot. Ron, who gets your vote for CEO of the year? I'm going with Rich Templeton, CEO of Texas Instruments. T.I's success over the past two decades, I think is in a big way due to his leadership. He became CEO in 2004, chairman of the board in 2008. He was president of the semiconductor business starting in 1996. Since he became CEO, Texas Instrument shareholders have enjoyed over 800% in total returns, more than double the S&P 500's return, and at the same time, the dividend has increased more than 5,000% to a current yield of 2.8%.

glass door rating of 92% for Mr. Templeton, only one of a handful of stocks that is both up and beating the market in our instant income portfolio that we started in March. That's a lot of calculators. Jason Moser, who gets your vote? Yeah, David Kimball at Alta. One of the reasons why I feel like he's deserving is he had some really big shoes to fill when Mary Dellen stepped down from Alta, right? She did tremendous work with that business for the time that she was there.

Kimball really has stepped in and just kept, he's kept this story going. The stock is up 10% year today. Clearly, I perform the S&P, which is down around 20% right now as we speak, up 35% since he took over back in June of 2021. You look at the way this year is wrapping up. They just raised guidance. They're calling for sales between $9.95 billion and $10 billion. That would represent significant growth.

Are you talking about $8.6 billion in revenue they brought in just a year ago? And add to that, the loyalty program that they continue to build out. They now have 39 million active loyalty members. That's 9% higher than a year ago. So yeah, a strong business. And it was one that was witnessing some turbulent times when Mary Dillon stepped in there. It's good to see that David Kimball's really been able to keep that ball rolling. Emily, who you voting for?

Oh, we have Alta, Unilever, Texas Instruments. I mean, all great businesses. But CEO of the year doesn't necessarily have to be a business that has done particularly well because of a CEO. I don't think it's possible to reflect on CEOs in 2022 without mentioning Elon Musk because it's become notorious a meme at this point. But Tesla and Twitter, numerous businesses impacted by what you can probably call her his antics that he's performed over the past year.

Certainly some of the biggest headlines in the year, all generated from Elon Musk, even as we're today, new headlines out for this business and the way he's managing Twitter. So when I think about the CEO that defined the past year, I mean, there is nobody that takes that title more than Elon Musk does. What was the dumbest investment of 2022? That award is next. So stay right here. You're listening to Motley Full Money.

Welcome back to Motley Full Money. Chris Hill here in studio with Emily Flippin, Jason Moser, and Ron Gross. It is our year-in review special. And let's face it, Ron, not every investment works out. So, whether it's an investment, particularly this year, so whether it's in your own portfolio or maybe the way a public company decided to allocate their own capital in 2022, when you think about this year, what gets your vote as the dumbest investment of the year? The investment that I made that could have been a disaster, but I got bailed out by the Wall

Street Betts Reddit crowd was Bedbeth and Beyond. We talk about it a lot on the show. I bought it around $12 and $14. Here we are at $3. I think the lesson here is that I bought Bedbath as a turnaround play, and that's much different and more risky than buying a great company and holding it for the long term. I think you can have a certain allocation to things like turnarounds, but they should probably be the exception and not the rule.

In this case, I was betting that new CEO, Mark Triton, would come in and work the same magic he worked at Target. He did not. In fact, he actually performed quite poorly, and he is no longer with the company. company, and now they have a real chance of bankruptcy. So I got lucky. The meme crowd bailed me out at artificially high prices. Thank you, folks. But if not for that, I would have been crushed.

I'm right there with you. And so again, shout out to the Wall Street Betts crowd for helping us out there. On the turnaround, I think that one of the things that did it for me was the fact that when Triton was shown the door, there wasn't really any clear path forward for the company. The board wasn't really saying, he's out, and here's what we're going to do instead. It was just sort of like, well, we're going to tread water for a while. And I said, I think it's time to sell. Tritin was focused on private label.

They decided to go back to brands, but the shelves were empty because the vendor relationships were shot. And the balance sheets of mess. So this could not end well. It might not end well. Other than that, shares look pretty attractive. Emily, what about you? Dumbest investment of the year? It could be easy for me to say Elon must overpaying by probably about $40 billion.

for Twitter, but let's not kick someone while they're down. So here, I'll kick a different industry while it's down. Cryptocurrencies. I'm sorry to say it, again, kicking someone while they're down, but cryptocurrencies have to mark 2022 as some of the worst investments you could have bought. And this is not just because of recent news, although it has been in the news a lot. This has really been since the beginning of the year. There's a big pullback in tech companies, many of which supported crypto investments as either part of their business strategy or their ideology.

As a result, both retail and institutional investors, the risk tolerances completely changed. And the guise for a lot of these cryptocurrencies of being a hedge against inflation and political turmoil, that started to crumble as their asset prices decreased alongside the broader markets. And on top of that, you had all this regulatory pressure heating up, increasing tax obligations to looking for ways to protect consumers, both in the U.S. and abroad. And then on top of it, big coins, right? Terra, for instance, melting down as a result of numerous. bank runs caused by fear in the market. And then the cherry on top, the fallout of the

crypto exchanges themselves with FTX, just being one example of a high profile crypto exchange falling apart due to fraud and mismanagement. It's a hard time to be a crypto investor. I won't make any expectations headed into 2023, but I can confidently say 2022, not in a great year to be invested in crypto. It's a hard time to be a crypto investor. It's also got to be, particularly in the wake of the fallout with Sam Bankmanfried, it's got to be so hard to be a crypto bull, to be, to have your job tied to really making the case for crypto as a great investment in 2023 and beyond. And let's be clear, there are lots of people for which that is the case.

And as much as we talk about fraud and mismanagement, as with most new technology, there tend to be a lot of it in these new industries. There are also people who are legitimately trying to do the right thing. innovated industry because they believe in either cryptocurrencies or blockchain technology. Those people are trying to build businesses on what is now an asset class in a technology that is deemed by many professionals to be completely defunct. You are essentially trying to convince people that the crimes and the issues that have happened in the past will not repeat again in the future without actually being able to make that promise.

So finding new capital allocators, finding people to invest in these ideas and in businesses, It's hard to imagine that getting any better in 2023. Jason? Yeah, I mean, I don't know if it's the dumbest, but it certainly is questionable, right? I mean, we did some research recently. We discovered that Kellogg has three bowl games on the docket. They're sponsoring three bowl games here. I didn't know that.

Two of them are Cheez-Itzitz, right? You've got the Cheez-It Citrus Bowl, which just doesn't sound right. And then you've got the Cheez-It Bowl, and then you got the Tony the Tiger Bowl. Now listen, extra toasty Cheez-y Cheez-It's, are on my Mount Rush more of snacks. I mean, easily, one of the best things ever produced. And dating all the way back to 1921, did you know Cheez-It's due? They bring in $1.2 billion in revenue for Kellogg, a company that brings in around $15

million a year. Jesus, they're responsible for $1.2 billion of the dollar. Now, here's my concern. That those people are drunk with power? Possibly, possibly. I mean, typically to sponsor a bowl, right? You're talking about millions and millions of dollars. I'm not necessarily knocking them for sponsoring the bowls, right? Having three bowls. Remember, Kellogg

is actually going to split into three different companies by the end of 2023, one snack, one cereal, one plant-based. For my money, I feel like you don't double down on the cheese. It's maybe a shot a spotlight on Pringles, man. I mean, those things are really good, too, right? Pringle some love. Give Pringle some love. Really leverage that portfolio for all its worth, because I, you know, doubling down on the cheese, as much as I love them, it just feels like, It's not the best investment, right? I would love to see an office-style mini-documentary with the different brand managers, because you know there are some brand managers who are very upset about the fact that

Cheez-It gets two bowl games and their brand doesn't get any. At the very least, you've got the Cheez-It Bowl and then you've got the extra-toasty cheese-it bowl. I mean, differentiate a little bit. Now I'm going to have to try these. Oh, my God. They're so good. We led the show with the big stories of the year, and every year there are important things

is that kind of go under the radar, either at a company level, an industry level, a trend level. What's something that you think didn't get enough attention this year, Ron? Something that I discovered last month was, last week actually, was Casey's general stores, a chain of convenience stores that many people probably have not heard of, depending on what part of the country you live in, is trading near its all-time high in this kind of a market environment. And I don't think they've gotten enough credit for that. $9 billion company, 2,400 stores, EPS growth of 42% in the most recent quarter. They raised their guidance.

The stock is up 23% this year. Now, it's not cheap. It's 25 times forward earnings, so be careful there. But it's very impressive in this environment to put up those kind of numbers. Yeah, I saw some stories earlier this week about sort of like the top stocks of the year. And, you know, no slight against them. But some of them are just sort of like microcaps that happen to hit a little bit of a hot streak. You talk about a business like Casey's.

It really is a business that goes under the radar. And that's amazing. Yeah, really good. They have the inside and the outside, you know, gas on the outside and all the convenience items on the inside. And they've done a great job. Plus beer, cheese pizza. Of course.

Emily, what about you? Sure. My story is actually U.S.-China relationships. And this is a big story. It's gotten a lot of headlines, but I think investors are reading it wrong, which is why I highlight it as, as an investing story that has gone under the radar. The biggest thing that's being reported on right now are the chip sanctions, right? Not selling high-end chips to China, ensuring that more production comes to the U.S., but

this is a massive change in policy that could have really wide-reaching effects for the global economy for decades into the future. We haven't seen this streak of nationalism in an extremely long time, which is essentially saying we're giving up the benefits of globalization, of a closer relationship between two of the largest superpowers in the world and an effort to protect and ensure domestic national security and production. And it's important, I think, to the rest of the world and myself as just an American, that two superpowers that have so much that influence over each other stay connected in a way that prevents global conflict. But this decoupling is very scary in the sense that I could have

wide-reaching ramifications on the world stage. So I think the chip policies that we saw Institute in 2022 could just be some of the first policies that is at the beginning of a wider decoupling heading into the next few years. Well, and as we speak, one of the stories gaining traction across the river on Capitol Hill is TikTok and banning TikTok from government devices. Well, not just TikTok banning any social media platform that is owned by an adversary. So China, Russia, Cuba, any of these countries, right, their technology, their innovation, their entrepreneurship no longer being accessible to Americans. And it's for national security,

of course, and I think there are legitimate concerns there. But it just goes to highlight that we're going to be protecting our domestic industries, not just in the U.S., but other countries as well. And as we move towards more individualistic policies, the globalization that we spent the better half of the last century moving towards becomes less and less relevant, increasing the potential for further geopolitical conflict. And I don't mean to sound super scary here, but nothing of that sort is happening right now, but it's certainly taking a step in that direction. Jason, what about you? Yeah, a company I've recommended, a company that I own, Outset Medical.

If you remember earlier in the year, around mid-June, they released some news that they've been working with the FDA. So outset, as a reminder, they are in the dialysis market. They have a machine called the Tableau, which is ultimately, is the first two-way wireless connected dialysis machine. And so they are taking it beyond just hospital settings and really focusing on the in-home setting as well. So it's making dialysis more affordable and accessible for everyone who needs it. And it is a need, right? It's not really optional for many people.

But there was an issue with a software update. The FDA wanted more information, more data. And so ultimately what they had to do, they had to put the shipping of these devices on hold. And as you can imagine, the market did not receive that news very well, stock fell 35% just at one day. It seemed a bit odd. I mean, we knew that the acute demand was still strong for the machine. The in-home demand was still strong. And there were no safety issues. It really did look like it was just the FDA wanted more data. They wanted to cross all the T's and dot all the I, so to speak. And ultimately, that's what happened. You fast forward a couple of months. They were able to start shipping those devices. Again, the stock is up 75% since that press announcement came out of the hold on the shipments. And it's just, it's a good reminder sometimes you can dig in there and you can find some opportunities.

when you feel like it's something that perhaps is not necessarily fatal to the business, but just something that the company is working through. It's also surprising to see the FDA react that quickly. Yeah, well, you're right. But I think that speaks to the importance of the machine that they make and the value that it serves. One thing about investing, there are always surprises. So after the break, we're going to share a few things we did not have on our bingo card in 2022. Stay right here. This is Motley Full Money.

Welcome back to Motley Full Money, Chris Hill here in studio with Emily Flippin, Jason Moser, and Ron Gross. It's our year-in-review special. Time for a round of fill-in-the-blank, Ron. The stocker business that surprised me the most this year was blank. Much like Casey's General Store, the story for Campbell's Soup really surprised me, because it's kind of sleepy. It's always there, but yet we don't talk about it that much. It's trading at its five-year high. It's up 30% this year. And it turns out, if you make soup, you have pricing. power. If you make tasty water, you could raise prices occasionally. Good for them. Their recent report was quite strong. They raised guidance, a successful turnaround by relatively new CEO, Mark Klaus,

who joined the company in 2019. And he did things like redesign the labels to give a more modern look, removed out-of-favor ingredients like high fructose corn syrup, a new line of spicy soups under the Chunky brand. Great marketing, actually, with athletes, social media, Madden Video Games. So they've done a really nice job, and it has shown up in the stock price. Yeah, you don't think of soup as having pricing power. Well, you guys haven't been to the grocery store recently because I'll tell you what, I went to go buy some Campbell soups, and they're like $5 a can now. It's ridiculous. Shareholders, thank you.

For your purchase. Soup is good food, right? Emily, the stocker business that surprised you the most this year? Yeah, the stock that's surprising those this year is certainly Axon, not nearly under the radar as Campbell's, but it's been a really weird year. And I don't think anybody can fault a company for setting out expectations for 2022 that didn't quite come to fruition. Axon, on the other hand, is absolutely killing it. And it's been very surprising. Not only has their business been virtually unchanged by the world around them, but it's actually gotten better. All metrics that the company put forward at the beginning of the year have been surpassed. Revenue growth is accelerating. Government contracts have have grown at a time when people heading into the year definitely believe that that market was relatively saturated. Their international expansion, even given the geopolitical turmoil, has been incredibly resilient. More importantly, supply chain issues that impact the hardware part

of their business have been more than made up by the software. So gross margins have grown year-over-year. They even became operating profitable much earlier than anybody expected. This stock has dramatically outperformed the market over the past year as a result. But heading into the year, I was very excited about this business, but by no means that I expect for them to have such an incredible past 12 months as they have. Jason, what surprised you this year? Yeah, business that has, you know, it has a rich history here. It's the market leader in its space and then customer relationship management.

Salesforce has had a really difficult year. Stock is down 50%. And they are witnessing a massive leadership exodus here, right? I mean, now sole CEO, founder and CEO Mark Beniof just saw his second co-CEO in three years to depart. Brett Taylor took off. He's lost now Stuart Butterfield, who was the Slack founder. He's lost the Tableau president CEO, Mark Nelson. And according to a Bloomberg report, at least a dozen individuals have announced resignation since October. So it makes you wonder a little bit, what's going on here? What's Benioff going to do? Is there a cultural shift happening? But there is some news out there that he's asked some managers to rank their lowest 10% of

employees. It sounds like Salesforce might be joining that job cuts, bandwagon that we're seeing a lot of these software companies go through now. And, you know, it's a business that brings in a lot of money, but they're being pressed now to focus on profitability, which I ultimately think is a good thing. I feel like this more than likely is an opportunity, but clearly something is going on here that Benny Off is going to have to straighten out. I want to just add in that if you told me a movie sequel to a movie that came out 36 years ago was hitting the theaters, I would be reluctant to predict its success. And yet, Top Gone Maverick is the number one movie at the box office this year.

And related to that, and this blew me away, the average box office receipts from movies released this year were the highest since 2010. Wow. I haven't seen it yet. You haven't seen it? Don't give it away. No spoilers. We better wrap up this show, so you can get to see this.

Fill in the blank, Ron. I can't believe blank is still there. It can be a CEO, it could be a company that maybe you thought was going away. I can't believe the SPAC industry is still here. Despite the almost total implosion of the SPAC frenzy, there are still plenty that are still lingering. There's been an incredible amount of value destruction by these so-called special purpose acquisition companies. At least 80 SPACs, which have raised $24 billion, are facing investor meetings that will give clients the chance to exit ahead of a new U.S. tax law. that could hurt their returns.

At least 32 SPACs holding roughly $18 billion are looking to close up shop and return capital over the coming two and a half weeks. We really saw a bubble here with people being able to raise money very, very easily, and it has come home to haunt a lot of folks. Do you think they're happy about what's happening in crypto because they look better by example?

Yeah, you hang out with ugly people. You look pretty. We're just going to hang out with their crypto crowd. Emily, you can't believe blank. is still here. On the flip, I can't believe that Warren Buffett is still here. That's not a shot at his age. I know that's what it sounds like. But more that he is just as relevant as ever, there was an extended period. The vast majority of my time as a relatively young investor, I've seen an in growing up in an environment where Warren Buffett was maybe a little bit outdated,

right? A little less trendy than some of the stuff that's been going on in the market, especially around growth stocks. But, you know, 2022 had certainly different things in store. And Warren Buffett and Berkshire Hathaway making so many interesting investments into the energy sector, just being one example of ways that they've driven operating profits for that business in a way that is increasingly relevant. And while some of those equity investments have been into oil and gas, a lot of them still into really forward-looking technology like renewable energy. So still around, still relevant. Who knows what 2023 will have? But 2022 is certainly good. I'm genuinely surprised that he hasn't done what we've seen other CEOs

in his position to, which is to essentially boot themselves upstairs, say, I'm not going to be CEO anymore. I'm going to remain as chairman. I feel like that's the next move, but what do you think? If I had to bet, now, granted I would have said the same thing headed into 2022, but 2023 is the year, y'all. He'll make that decision. He'll step back or he'll, you know, die trying. Jason? Yeah, nothing personal. It's just Bob Iger, man. The guy's still here, right? He's back and apparently better than ever. Who knows? We'll see. If you remember, Bob Chepec was my choice for our mid-year preview show as the CEO who needed a strong finish to the year. I guess he needed a stronger finish than I thought, because he obviously is no longer with the company. But

I understand bringing Iger back in, to the extent that this business is in the middle of a major generational transition, right, and how it produces and distributes media. And Bob Iger has the track record with the company and the acquisitions that he's made along the way. And clearly was the vision behind the Disney Plus idea. But for me, it really does boil down to like, what is he going to do different than Chepeg was doing? Maybe there were some cultural issues. And obviously, Chepeg had some stumbles along the way. But what is Bob Iger going to do different in order to bring this streaming operation of profitability?

Because I think it's pretty well known. I mean, Bob Iger always felt like keeping prices lower was a nice differentiator. Whereas Chepec was starting to bump those prices up in order to get to that profitability target by the end of 2024. So I think a lot of question marks remain as to exactly how this is going to look going forward. And I think that's why the market is keeping Disney's stock and kind of a holding pattern right now. And then, of course, the question is what after Iger again? Like, can they ever really move pat? They're going to have to eventually, of course, what that looks like is still up for debate.

In that same vein, I can't believe Howard Schultz is still at Starbucks. Yeah. And even when he came back earlier this year and it was in the fall going to name a new CEO. Well, he did, but the new CEO doesn't start until April of 2023. If it was easy, everybody would be doing it, right? Ron, fill in the blank. I did not have blank on my 2022 bingo card. The breakthrough announcement that scientists produced a nuclear,

easy for me to say, nuclear fusion reaction resulting in a net energy gain. Now, as one scientist said, this is a science achievement, not a practical one. We got a long way to go to make this actually useful, probably decades. But still, even if it is decades away, it really could be a game changer for the energy industry, for business in general, certainly for the climate, you name it. It literally is one of the biggest advancements we would have seen in a lot of. long time, perhaps forever. So stay tuned. It's going to be an interesting next few decades. You think we're going to be around to see it? Let's hope so. Emily, what did you not have on your

bingo card this year? I want to say Taco Bell bringing back Mexican pizza. It feels kind of like, you know, that boyfriend that you dumped and then, you know, a year later shows up on your doorstep and is like, oh, you know, things have changed. Taco Bell, nothing's changed. You can't buy us back with their Mexican pizza. No, but realistically, the thing that's on my list here is Dan Springer stepping down from the CEO of DocuSign. That is a business that he led through its IPO. He was not the founder of the company, but was often perceived alongside those who do found companies. That's how involved he was in the day-to-day strategy and operations of that company. So after a couple of quarters of really lackluster growth coming out of the pandemic, the board

opted to boot him, right? He resigned from his role. They brought in a new CEO who just had their first quarter with DocuSign. So very surprising boot, in my opinion, maybe a little bit premature. We'll see how the new CEO operates, but certainly was not expecting that headed into the year. Jason? Yeah, I have to say the Netflix rolling out an ad-supported model did surprise me. And I'm not necessarily disagreeing with it. I mean, I feel like that is the direction much of this is headed. I mean, we know that the ad-supported video on-demand market is robust and growing, and it's global. But to see Reed Hastings pivot. So, quick, It was a bit surprising from a man that we've often considered the smartest in the room when it comes to this market.

So it definitely feels more reactive as opposed to proactive, right? It's more reactive as to kind of what the market is dictating. So you wonder, will they be able to do this as well? And I just don't know yet. I mean, we've seen early signs. They're falling short of the viewership guarantees that they were making with their advertising partners and actually allowing advertising partners to take that money back. With that said, I mean, I wouldn't just say that that's the end of it, right?

I mean, this is something they rolled out very quickly. And I think you got to give them a little bit of time to figure out how to make it work best for their particular platform. But again, for someone who is so vehemently against introducing advertising into their business model, they changed their mind pretty quickly there. And it was pretty recently that he was vehemently opposed to it as well. Oh, yeah. Well, I mean, they made the announcement. The war started coming out, but just back in May, right?

I mean, so that shows you just how quickly this was rolled out. This is not a comment on Elon Musk. But I didn't think anyone was going to buy Twitter, not an individual or a company. And, you know, there are these companies that we talk about from time to time that are struggling and struggle for years. and we think, well, maybe someone would buy them. And I've posed that question to you about a number of companies, Ron. And your response has been like, well, why would they buy them? You know, just because a huge tech company like Alphabet has the money,

it doesn't mean that they necessarily need to buy a business like that. And the fact that it was Musk himself just saying, yeah, I'm going to write a check. Hey, if you've got a mediocre company and somebody offers you double for it, take it. Coming up after the break, we will share our investing discoveries of 2020. We'll also share a few stocks on our radar. So stay right here. You're listening to Motley Fool Money. Crazy.

Crazy for feeling so long as always, people in the program may have interest in the stocks they talk about and the Motley Fool may have formal recommendations for or against. Don't buy ourselves stocks based solely on what you hear. Welcome back to Motley Full Money, Chris Hill, here in studio with Jason Moser, Emily Flippen, and Ron Gross. We are wrapping up our year-in-review special. Jason, what is your investing discovery of the year? It can be a stock you bought for the first time.

It could be a book you read. Maybe someone you started following on Twitter. Go crazy. Well, yeah, we talk a lot about the war on cash, right? On these shows, and for the most part, I mean, I think that is generally the trend that the world is following. I mean, that is sort of the direction we're going. But back in August with Motleyful Money, I had the opportunity to interview Brett Scott on his new book, Cloud Money, Cash, Cross.

cards, crypto, and the war for our wallets. So I will say that was a very enjoyable read for me because it gives you that alternative perspective. We talked about his financial background, his view on how cashless marginalizes parts of society, monitoring and privacy debates that stem from going cashless, and also his views on crypto. It was a very enjoyable. I've learned a lot. The book was really enjoyable, and I think that folks would enjoy the interview.

So if you missed it, go check that interview back. It's from August. In whatever podcast feed you prefer. Emily, what about you? Yeah, my investing discovery of the year is something called quarter. It's without the E. So it's like court. It's a pirate. I'm surprised that your reactions, that you all seem like you haven't heard of this before. Okay, because I feel like I'm late to the game here, but it's essentially an app.

And now, unfortunately, it's only on your phone. So if you're an old person like me and I like to do things on my computer, it can be a little, You can put you out a little bit, but it allows you to effectively listen to earnings calls and then read through the investor decks. And if anybody who tries to listen to earnings calls knows, this is something that it's kind of onerous to go through to the web page, find where the page is being hosted, put in all your personal information most of the time, listen to it, go through all the 15 minutes of silence at the beginning, the technical difficulties.

This play is just like Spotify. You open it up. They have the vast majority of the companies that retail investors be interested in. You just hit play, and it plays for you. The investor deck is right there. So it's incredibly simple and easy. It allows me to actually listen to earnings calls while I'm doing something like making dinner. So it has certainly improved my investing, although I will say, I wish I could have it on my computer. You want to take it the next level nerd. You just Bluetooth that thing in your car and you stream some earnings calls while you're driving your air.

New podcasts. And Emily, also a nice reminder that while we often encourage people to check out the investor relations section of a company's website, not all of them are as good as the rest. Some are better than others. Exactly. Ron, your discovery of the year? I would recommend the memos of famed investor Howard Marks, co-founder, co-chairman of Oak Tree Capital. They're all worth reading all of the memos, but his latest one has been getting a lot of attention because he says in his 53 years in the investment world, he remembers only two real sea changes, and he thinks we may be in the midst of a third one today.

So definitely worth reading that one. But I would read all of them the way we recommend going back and reading Buffett's shareholder letters, There's a lot of good information there. All right. Let's get to the stocks on our radar. Our man behind the glass, Rick Angdall's going to hit you with the question. Jason, Mosier, you're up first. What are you looking at this week? Yeah, Booz Allen Hamilton, ticker is B-A-H. In simplest terms, this is a consulting firm. They focus primarily on analytics, digital solutions, engineering, cybersecurity, and general consulting, probably an under-the-radar sleepy company. Most people probably fall asleep before I even

finish the word Hamilton, right? This is a pretty compelling business. So, in a 97% of their revenue is tied to the U.S. government. Ain't many more big spenders in the world than the U.S. government, so that's pretty good. And they've got a long, long, rich history. Companies well over 100 years old. Very tech focused. The workforce has moved from about 30% of tech backgrounds in 2013, about 70% of their client staff has full technology backgrounds.

And that continues to grow. Total returns to the stock over the last five years, just under 200%. The 10-year chart looks amazing. Just over 900% total returns, 1.6% dividend yield to pay you while you wait, a very interesting business. Rick, question about Booz Allen Hamilton? It's a big ask here. Booz Allen Hamilton. I do feel like I've known this company for a long time.

Mostly because I have friends from college who put on a suit and went to work for them, and I never heard from them again. What really goes on there? I have no idea. They do have some very close ties with some intelligence agencies. So who knows? Maybe they went missing on purpose. Emily, what are you looking at this week? I'm looking at Top Golf Callaway. The ticker is M-O-D-G. A lot of investors may be familiar with this company, especially if you are a golfer.

They have a decent portion of their business coming from Callaway branded products. That's golf equipment for the avid golfers out there. But they actually just completed a really sizable acquisition of Top Golf, which is, as many investors know, a location where you can go casually shoot some putts to have a drink, have something to eat. Have a little event. Did you say shoot some puts? Is that not the right lingo? That's awesome.

Well, they're in the process of building out. They're trying to effectively increase their store account of Top Golf by around 50% over the next few years. The problem is they have a lot of debt from the acquisition. It's pretty capital intensive, but a very interesting company. Rick, question about Top Golf Callaway? Yeah, when I hear Top Golf, I think team building events. That seems to be what that company's for. But hasn't it kind of been usurped by the axe throwers now?

Is there a battle between the, I put my money on the axe throwers, I think. I think PUT-PUT-PUTT can have a comeback, too. Ron, what are you looking at? Talking about nuclear fusion, got me in the mindset of alternative energy. So I'm going back to Nextera Energy, N-E, largest electric utility in Florida, largest winded solar operator in the world. So you get both. They're a dividend aristocrat with 26 consecutive years of annual increases.

Rick? Question about Next-era energy? Yeah, it seems like Next-era, is going to be outdated at some point. Like with the fusion, is it going to become like Next Next-Nex era? Exactly. It's going to take a while, but I think there's room for many alternatives. What do you want to add to your watch list, Rick? I think Next Next-Nex energy is going to go in my final, final folder.

All right, Emily Flippin, Jason Mozer, Ron Gross. Thanks so much for being here. Thanks, Chris. That's going to do it for this week's Motley Full Money Radio show. The show is Mixed by Rick Engdahl. I'm Chris Hill. Thanks for listening. We'll see you next time.