Motley Fool Money - Cooking with Stocks

Episode Date: August 22, 2022

Inspiration for great investments can come from anywhere, including your childhood kitchen. As we head into the dog days of August, we're sharing "origin story" conversations with some of the investors you've heard on this show. (0:21) Jason Moser discusses: - The important (and very different) roles his parents played in his investing life - 1st stock he ever bought - How the worst stock he ever bought is now the property of JP Morgan Chase - The proverbial "one that got away" - The dividend aristocrat that takes him back to his childhood Stocks mentioned: CSCO, JPM, MKC, NFLX, APPH, AMZN Host: Chris Hill Guest: Jason Moser Engineer: Dan Boyd 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 2 of Marvel Television's Daredevil Born Again on Disney Plus. days of August, we got something a little different planned. Motley Fool Money starts now.

I'm Chris Hill, and let me start with some context. It's late August and in years past with our daily Market Foolery podcast, we would have what we like to call a short week, which was code for, hey, we're taking a couple of days off and there's a chance you might be too because it's late August. Now, we are not taking any time off this week. we are in the final days of preparation for our investing conference next week in Washington, D.C. It is all hands-on deck time for many of the people that you hear on this show, including and especially yours truly.

So, today and tomorrow, instead of hitting the headlines, we're bringing you conversations with two of our senior analysts. And rather than drilling down on a specific investing topic, we're talking about their origin stories as investors, how they got started. mistakes they made along the way and how they think about investing. We're going to hit the stock market news later in the week. Next Monday and Tuesday, we're going to be recording episodes from our conference in DC. But right now, here's my conversation with Motley Fool senior analyst, Jason Moser, about the influence

of his parents on his investing life, the company that he admires most, and when it all started for him. How did you learn about investing? Were you a kid? Did your dad teach you, or did it come to you later in life? Yeah, my father taught me. I was a kid, probably in like seventh grade when it really started kind of sinking in. I was lucky in that my dad, who's a physician by trade, he would give me around to school

in the mornings during my eighth grade year, I think it was. Around that time, seventh, eighth grade, in the mornings, if we weren't listening to an audio book on NPR, because back in the day, that's how it was done. He would talk to me about investing. He would talk to me about stocks that he bought and just kind of give me the idea of how investing worked and what it was all about. And yeah, that was where the seed was planted. And then for whatever reason, for me, finance, economics, stock market investing, all that stuff, just piqued my interest as I grew up. I was an economics major in college, I think,

because of that really. But yeah, it all really started with just some school, ride school conversations with my father. What was the first stock you bought? So, the first stock I ever bought. Now, I need to be clarified, it's not the first stock I ever owned, because along the way, my dad gave me, he opened up an account for me at Edward Jones years, years ago, obviously. And so first, he would gift me share. for birthday or for Christmas, and he gave me shares of Walgreen. He gave me shares one year of Dell. He even gave me shares of one company. I think it was called Global Crossing. I think

it's long out of business. But most of what I did was just dollar cost averaging into mutual funds. And so I had done that for the longest time. And then at some point, maybe when I was around, well, I'm not sure how old it was at that point. My mind is failing me now, But it was around 2000. The Edward Jones representative said, hey, you know, were you interested in individual stocks? And I thought, well, sure, let's give it a try. And he recommended Cisco. And Chris, let me tell you.

In the year 2000. In the year 2000. Because this market is never going to stop going up. It's just never going down, right? And I mean, you look back in your history, you understand very quickly. This was at the height of this company's powers, right? This was buying at the top, so to speak. Thankfully, it was just a modest purchase, and it was the first stock that I ever purchased,

but it was a great lesson that stocks indeed can and do go down. In some cases, they go down an awful lot. Just to clear the record, I do not own shares of Cisco anymore, Chris. What's the worst stock you ever bought? Washington Mutual. This one came to me very quickly. When you asked this question, I thought, well, that's the one that stands out. And primarily, it's because it went to zero.

Now, I will say, this was one, all the way to zero. All the way to zero. Yeah, this was one that was at the peak of the great financial crisis. You go back to 2008-910. And there was all this talk of what were we going to do with the banks. I mean, these banks were in a lot of trouble with the banking. The banking lands, it was a tremendous amount of turmoil there. Washington Mutual was one of these mortgage lenders that really got in over their eyeballs.

And a lot of talk, would they or would they not nationalize the banking sector? How are they going to deal with all this? And so, to me, and this was early on in my tenure, I think this was maybe right before I actually started here at The Fool when I did this. But I essentially went in with a gambler's mentality. It said, hey, man, everything's going to be all right. We're going to buy the dip. Everything's going to be fine. They're not going to nationalize the banking sector. That's madness. Now, of course, they didn't nationalize the banking

sector, but that didn't stop watching a mutual from falling flat on its face. Again, thankfully, a very small amount of money, but a very valuable lesson learned. If you go in there with a gambler's mentality, you're going to get what you asked for. How is a gambler's mentality different from the mentality of, well, I'm not. just putting a tiny amount of money, and I don't care. Or is it the same? It's like, I'm just putting a tiny amount of money, and if it goes to zero, it goes to zero. I feel like that's the same. Maybe the difference is if you put that tiny amount of money

and you can actually identify what the business does and the potential tailwind, or the potential catalyst that changes the conversation or changes the direction for the business. I think at the time, really, I looked at what Washington Mutual did, but clearly, I had not dug into the actual business and understood the nature of its exposure to the mortgage market. It just struck me as, this was a company that was so big once ago and so crucial to this mortgage market, it's got to come back, right? Things got to get. So, hey, let's just, you go in there and you flip a coin, and you're going to get heads sometimes and tails the other, but that was another very good lesson. And that's why I just, I don't bother

with trading, and I don't bother with going in with that game. gamblers mentality. I'd rather just bet on NFL games. That's more enjoyable to me, Chris. Put five bucks on the Cowboys, right? Give me $10 in the Eagles, whatever that may be. But at least you know what you're getting when you go into it, right? If you're going to take a gambler's mentality, then make it about gambling. Exactly. One of the investing lessons from the classic movie Wall Street is don't get emotional about stock. But that's hard to do because we're human beings. And I'm

I feel it in my own life, that there are stocks that I feel a greater attachment to, not necessarily because it's the biggest holding, but because maybe there's a memory attached to it, something like that. What is the stock that means the most to you? Yeah, I like that because I agree, don't get emotional, but by the same token, that's so hard to not. So I think, really, it's just don't let your emotions drive your decisions. It's kind of the way I like to look at that, because it's just, it's emotions or something is really difficult to control. But I'm going to go with it. two companies here, because the first one is actually no longer a publicly traded company.

But Jimbery, which may sound a little funny. I remember Jimbury. Yeah, yeah. Well, if you're a parent, I'm sure you've had experience with it. And that was what really took me by surprise with this company so early on. Now, I have two kids, two daughters. And back in that 2010-2011 time frame, they were very young. They were five years old. And so, Chris, I'm just a dumb guy. I don't know how to dress little girls.

I mean, that was what I realized very quickly. I've just embraced being a father from every angle. It's the best thing in the world. But I also looked at it. I thought, man, I have no idea how to dress these little girls. I'm going to put something on them. My wife is just going to freak. She's not going to like this.

So I don't want to waste money. I'm trying to figure out how to deal with this. And I don't want to just say, well, my wife can handle it because that's not very, we were taking the team approach. And so I was floored when I discovered Jim Burree because they made it so easy for a dummy like me to dress his little daughters. And they actually looked nice. They looked good.

And so it was not only the in-store experience, but it was the online experience. Then they had the Jim Bucks program where it's a kind of a loyalty thing where you buy so many clothes, and then you get free money to buy more clothes. I was just astounded at how easy it made it. Is the free money they gave away part of why they're no longer a publicly traded company? No. I was actually, I had pushed this. I had pitched Jim Boree early on in my development here at The Fool.

Going through our analyst development program in 2010 and 2011, one of the features of the program was constant pitching of ideas to the teams. So Jim Boree just struck me as one. I was interested in the business. own shares of it myself, I thought, well, I'm going to pitch this thing and explain my case. Unfortunately, it never made it through to a service. I understand why. Retail is a difficult space. But it was an investment that did very well for me. It was ultimately acquired and taken private, but it was done so at a premium. That was really great to see. Now, the history since

then, I mean, private equity really kind of put them in a tough spot. But as a publicly traded company, Jim Burry did really well. And I just have fond memory. of why. It was really all tied to my kids. And so that's one that really stands out. Now, in regard to companies that are still publicly traded, I think everybody probably knows I'm going to say McCormick. And the main reason is because it takes me back to my childhood. My mom, my dad taught me about investing. My mom and my father, to a lesser extent, but really, I observed my mom in the kitchen a lot growing up and cooking, and she taught me how to do a lot stuff in the kitchen and around the house. And I just remember vividly that McCormick label

in every nook and cranny of our kitchen. To this day, I see that brand, and it takes me back to being a kid. And I obviously still cook a lot today. And my kitchen at home is just chock full with that McCormick brand everywhere. And consequently, I own shares of that business in my retirement portfolio as one that I intend to hold. for as long as I possibly can. But yeah, I look at those two businesses as investments that have worked out well, and ones where the emotions tied behind them are really positive. Is there one that got away? Is there a stock that you either sold too quickly or you just, for whatever combination of reasons, just never pulled the trigger on buying?

Yeah, Netflix stands out as the one there, which is funny because I remember long ago, Before I started here at The Fool, even, we lived in Kazakhstan for a couple of years, Astona Kazakhstan for a couple of years. We were there for work at the U.S. Embassy. I remember over the course of that two-year stretch there, we had gotten, they had a mail program there where you could get stuff from the U.S., and so we had a Netflix subscription at the time as just DVDs. But every once in a while, we would get some American DVDs from Netflix in the mail, which

It was awesome, man. I thought this is just the coolest thing ever. And so then you fast forward to, and I remember telling my wife, if this is a company that you could invest in, I'd be interested to know more. And fast forward to getting to The Fool. And obviously, Netflix is an idea that's made it into many services here and brought tremendous success to our services and our members. For whatever reason, I was just never able to fully buy into it. I mean, and I think part of that was because when I first got here, I was really kind of discovering what kind of investor I am. I didn't really know. Am I value investor? My growth investor. What really matters to me? Netflix being a very polarizing stock. A lot

of people have very strong opinions about it. And I was, I was, you know, head just going back and forth. It was like I was at a tennis match, right? I understood the point on both sides. And I almost just became paralyzed. And I just said, you know what? I just don't know what to do here. So I'm going to take a pass. I understand the bull case there, but I see valid points on the bare side as well. Maybe it's best to sit this one out. Obviously, a bad decision, but you live with those and you learn from them. Is there a company that you own shares of that you admire more than others?

Because there are businesses that can be very rewarding for shareholders. And that's great. Obviously, that's why we own stocks. Sometimes it's like, ah, this is, I don't love this business. I don't love what this company does. But hey, they're doing well. Is there a business that you actually do admire what they're doing? Yeah, yeah, there is.

I mean, App Harvest is really the one that stands out to me when I first thought about this. And it's clearly, it's an investment that's not done so well so far. That's for a number of reasons. I mean, this is a very, very early stage business, right? And I think we set that expectation from the very get-go. So I'm not terribly frustrated or disappointed by it. I fully expected that. So I just take it with a very heavy grain of salt and understanding that this is a very long-term

play here. But to me, when I look at what App Harvest is doing, and you look at the state of the world today, a growing population, a limited amount of resources, right? I mean, food is essential. You look at some of the data out there, the United Nations says the world's going to need at least 50% more food by 2050, and yet 70% of all fresh water is already dedicated to agriculture. According to the U.S. Department of Agriculture, 69% of all fresh vine crops sold in the U.S. in 2018 were imported. And we saw the past couple of years as food supply chains became

crunched, we saw that play out when you don't have the same level of control. control over the food that's being produced in your country and delivered to your citizens. So you look at controlled environment agriculture as a potential solution to this. It's not to replace farming, but it is to complement and make it ultimately better. And what they're doing, mean, they produce 30 times more per acre in CEA than traditional farming. It uses 90% less water. It's all rainwater, right?

They incorporate solar. It's pesticide-free. It's operational all year. Incorporates technology, AI, robotics, better quality, food, better yields. And so you look at the founder and CEO, Jonathan Webb, he's very passionate about this. The company is a certified B-Corp. It's a public benefit corporation. And so what that means is they're legally obligated in how they run this business, right?

Sometimes businesses, they can just say one thing and they'll do another. But really, at Parvus is going to be legally obligated here to really, really, not just talk to talk, but to walk the walk. So for me, it feels like the direction the world is headed. Controlled environment and agriculture is going to be a part of our global food supply chain. I like what this company stands for, and I still am very confident in where it will be 10 years from now. How did a company like this get your attention?

That's a good question. Well, I mean, so it was one that went public recently via SPAC, right? And we were talking a lot about SPACs and the pros and the cons and good examples and bad examples. And so I saw App Harvest as one of those companies that had just gone public, and I looked a little bit more into it. And once I learned a little bit about what the business actually did, it grabbed my attention in it. And it just started digging in more and more and more. It's just, again, I cook a lot at home so I could relate to it. a little bit. And frankly, it just stands out to me as one that makes a lot of sense. Again,

we live in a world with an ever-growing population and a limited amount of resources. So we're going to have to figure out ways, as many of these companies out here today are saying, they're going to do more with less. We're kind of in that same situation regarding our food supply. What's the stock that's your biggest holding? That would be Amazon, Chris.com. Do we need to explain why? Is it your biggest, just because you've held it for a long time? It's grown over there?

It is, yeah, for the most part. Amazon is my largest. I've owned it ever since I started here. I bought my first shares of Amazon in 2010, shortly after I started here at The Fool. And a lot of that really had to do with just a few Stock Advisor, Team David, stock talks. You go into a room and you talk with David Gardner about stocks for an hour, and you come away a lot smarter and very inspired. And we had talked a lot about Amazon in the early days, even as back in 2010, the argument

was, oh, it's just too expensive. It doesn't make any sense. And I guess it's a little bit different than the way Netflix was. With Amazon, I just saw it. It just made a little bit more sense to me than something like a Netflix. And I think that probably just goes to the market that it serves. E-commerce to me just seem like a bigger, more reliable, understandable market opportunity. So, I bought my first image on shares in 2010. Clearly, it's done very well since then, up something like 2,100 percent. But it's the biggest position today for three reasons. Number one, it's just an awesome business. I think we can all agree there.

Number two, I've held onto it for over a decade. I've held onto it now for around 12 years. We talk a lot about holding businesses for long periods of time. It's totally doable. If I can do it, anybody can do it, and there's a good example of the benefits. And then number Three, I added to it on the way up. I didn't leave it alone there. As the business continued to succeed, I bought a few more shares along the way. It's one that has just stood out as a business that continues to innovate, plays a very important role, obviously, all around the world. And so that's where we are today. I think it's easy to forget or overlook how pervasive, and where I'm going with this, is I'm thinking

about you holding a stock for more than a decade. I think it's really easy to overlook how pervasive in the financial media, in financial conversations in general, whether it's, you know, you're watching CNBC or Bloomberg, or you're reading an article or talking to a financial advisor, the idea of take some profits. It is ongoing, unceasing, unrelenting, So, not that anyone who holds a stock for more than 10 years deserves a medal, because ideally the reward is that, wow, you've held it all that time. And compounding interest is the reward. But it's one of those things that is actually harder than it sounds.

Yeah. Yeah, it definitely can be. To that point, to be very clear, I have sold some Amazon along the way. It was a position that it points it got to be a little bit bigger. than I really wanted it to be. And because I was still fairly early in the development of my portfolio, to me, it was an opportunity to take some of those gains and reallocate to new ideas. Now, it wasn't very much, right?

But it was enough to get that position back down to a situation where I felt, okay, I'm more comfortable with it here than I was there. And darn it, Chris, the thing just keeps on performing and getting bigger. And that's okay, right? I think that's a good point that you make there, is that there are companies that you can own for a long period of time, and they can keep on running, and they can do really well. But you do want to keep in mind. You want to make sure you're comfortable with the size of that position.

Everything in hindsight is very clear, right? But we know the market is forward-looking, telling the future is a far different exercise. So it's always something to keep in mind. Those big winners can serve not only as great performers in your portfolio, but opportunities to get some of those funds working in other ideas as well. And it makes up for the Washington Mutuals of the world. It does. Now, the only time I ever think about it is when you ask me questions, what's the worst stock you've ever bought?

Thanks for being here. Thank you. 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 yourself stocks based solely on what you hear. I'm Chris Hill. Thanks for listening. We'll see you tomorrow.