Motley Fool Money - Jobs, Rate Hike, Stocks on Sale

Episode Date: May 6, 2022

Busy week for investors as the April jobs report came two days after the Federal Reserve raised interest rates a half-percent. (0:30) Ron Gross and Jason Moser discuss: - Pitfalls and potential for stock investors - Rocky times for e-commerce companies Etsy, Shopify, and Wayfair - Booking Holdings and Marriott leading the travel industry - AMD defying expectations - Under Armour hitting an 11-year low - The latest from Zillow, Block, and Starbucks   (19:00) Malcolm Ethridge, CFP and host of “The Tech Money Podcast”, weighs in on the Nasdaq selloff and the potential for commercial real estate. He also offers a sneak preview of his upcoming book!   (34:15) Jason and Ron discuss a new breakfast innovation and share two stocks on their radar: Outset Medical and Domino’s Pizza.   Stocks discussed: ETSY, SHOP, W, BKNG, MAR, AMD, Z, ZG, SQ, UA, UAA, SBUX, OM, DPZ   Looking for 15 more stocks and 5 ETFs? Get a copy of our free investing starter kit at http://fool.com/starterkit   Host: Chris Hill Guests: Jason Moser, Ron Gross, Malcolm Ethridge Engineer: Dan Boyd Learn more about your ad choices. Visit megaphone.fm/adchoices

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It's the Motley Full Money Radio show. I'm Chris Hill, and I'm joined by Motley Fool Senior Analyst Jason Moser and Ron Gross. Good to see you, as always, gentlemen. Hey, hey. How you doing, Chris? We've got the latest headlines from Wall Street. Malcolm Etheridge from the Tech Money podcast is our guest. And as always, we got a couple of stocks on our radar. But we begin with the big macro. The U.S. economy added 428,000 jobs in April, making it the 12th consecutive month of adding at least 400,000 jobs.

On Wednesday, the Federal Reserve increased interest rates by a half percent. After the rally on Wall Street, late Wednesday afternoon, the market promptly tanked on Thursday with the NASDAQ falling 5 percent. So, Ron, busy week between economic data and the markets. Where do you want to begin? Man, oh, man, Chris. Would it help if I said, Uncle? Yes. Because this is no fun at all. Tough times out there for sure. Man, as you mentioned, we did get another strong jobs report, but that by no means tells us the whole story. Unemployment does remain low at 3.6%, but wages aren't keeping up with that

very high inflation rate. As you mentioned, we did have this week's 50 basis. point. Interest rate hike from the Fed, with definitely more to come in an attempt to fight that inflation. Interestingly, we actually saw GDP decline in the first quarter, with some actually predicting a recession on the horizon. And as all investors are seeing, we have individual companies digesting lots of stuff, all the things that came as a result of COVID, surging demand for certain products that are now coming back down to Earth, supply chain disruptions, China cautiously returning to work after being on lockdown. We obviously have high inflation, removal of stimulus, higher interest rates, devastation in Ukraine.

Thursday, as you said, the market just really tanked. I thought maybe we were on the upswing. But I think despite all of this, you have to stay invested. You have to keep investing. I guess that's my overall message and advice. Stay in the market. Keep putting money into the market. And Jason, we come out of April with,

with the NASDAQ year-to-date being down more than at any point this century to start the year. And so that makes a day-like Thursday a little bit more shocking with investors looking around saying, wait, I thought we were at the bottom. As Ron said, this is one of those times that we all just got to get through if we want the benefits of long-term investing. Yeah. You're absolutely right. I think you put that well. It's a period of time that you need to get through. And I said, I think, earlier in the week, for folks that have made it this far, right, it's been a tough year for investors so far. If you've made it this far and you haven't been scared away yet, congratulations. I mean, pat yourself on the back. Be prepared for

the next shoe to drop, right? It's really, this is all about, it's less about predicting the future and let's focus more in preparing for it, right? Let's admit that there are still some valuations out there that are lofty that are still up there. You still see some of these businesses out there that are trading for 15 to 20 times sales. So you can't dismiss that, particularly when you consider the fact that the economic conditions that borne those valuations, I mean, those economic conditions have now changed significantly, right? We're in a much different time. And so you got to think about that going forward. What's going to be the acceptable valuation that's a bit out of the norm here going forward?

And so that is a little bit of a trick trying to come up with that answer. But regardless, being able to stay in, it's a difficult thing to do, but the more you do it, the easier it gets. And Chris, as we always say, if you keep money that you need in the near term out of the market, that allows you to focus on the long term. And history shows us that in the long term, we should all be just fine. It was a rough week for e-commerce stocks. Shares of Etsy, eBay, Poshmark, Shopify, and Wayfair all got hit.

due to a similar theme, namely that consumers are pulling back on their spending. Jason, some of those like Shopify and eBay also lowered their guidance. Do you see any bright spots in the near term for this group or do shareholders of these companies just need to pack a lunch? No, I feel like they're bright spots, much as if when you're hungover, you see the bright spot that eventually you won't be hungover? Well, right now we're in the middle of a hangover, Chris. We're in the middle of this hangover, right?

We're seeing the after effects of all of the success that we pulled forward over the past couple of years. I mean, we've been having that discussion for the past couple of years, right? A lot of valuations got really out of control and seemed a bit pie in the sky because of the situation. And so we're dealing with the after effects of this. And it's being compounded by everything else that's going on in the world right now. With that said, I do think it's a reasonable take that while the pendulum swung too far to the

glass half full side. side over the past couple of years for a lot of these businesses. It is starting to feel like it's swinging too far to the glass half empty side. Now, I'm not calling a bottom, but just when you look at the way these businesses are performing, Wayfair, Etsy, Shopify, sure, numbers are down from the past year, but we also know that these management teams were forecasting that to happen. It's not a secret. But when you look at the fundamentals of the actual businesses, They do continue to perform well. I mean, you see Wayfair, we talk about repeat customers with Wayfair being such an important metric. They place 77.7% of total orders here in this most

recent quarter versus 74.5% in the first quarter a year ago. You look at Etsy and sure, you're seeing modest declines in gross merchandise sales, but ad strength is helping them maintain a take rate. Take rate 17.8% was up 17.5% from a year ago. And then you look at Shopify, I mean, they grew sales 22 percent from the same year ago, and that's a slowdown, right? You're talking about these businesses being a little bit more conservative on their guidance going forward as things start to normalize. That makes a lot of sense. We can't hold that against these businesses.

So I encourage investors to try to separate the macro from the actual fundamentals of some of these businesses. Because when you look at these three businesses together, Wayfair, Etsy and Shopify, for example, good examples of businesses that seem to be doing pretty well. doing what management says they're going to do, right? They're just dealing with a very difficult economic climate right now is a lot of these dollars that people were hoarding and saving and then spending via e-commerce of these past couple of years. Those dollars are now being re-diverted to things like travel and entertainment. That's to be expected. Speaking of travel, booking holdings

and Marriott, both out with first quarter reports this week. They also featured a similar theme, a growing demand for leisure travel. Both stocks were flat for the week, but Ron, Marriott and booking holdings, these are two of the leaders in this industry. Yeah, flat for the week, this week is not too shabby. That's pretty good, actually. People are replacing online shopping with getting out there and traveling again. And I think that's the story. And you can see it in the results. Marriott, for example, solid quarter, beat results, reinstated its dividends, which is a really positive indication for that business and maybe even the whole industry. Revenue up 81%. Boom, big number, obviously. Adjusted profit increased 12 times to 413 million

about. Management didn't offer guidance, but it says it sees a blockbuster summer. So there's some indication for you there. Booking holdings, very similar story. Stock remains down about 12% on the year, but the results are really turning around. Revenue up 136%. Similar comments to Marriott management said it is preparing for a busy summer travel season ahead, adjusted net income of 160 million. Booking holding only trading at 21 times earnings. So that looks interesting to me. If there's a chip shortage in the world, someone forgot to tell AMD.

First quarter revenue rose more than 70 percent, due in part to growth in AMD's high-end server chip business and the stock up 12 percent this week, Jason. Yeah, I mean, I've said it before. I mean, I think on its own, I mean, there are plenty of reasons to like AMD over the coming years. You know, we look at this move towards connectivity and we've got edge, cloud, data center opportunities, entertainment opportunities either. These are all drivers that are helping AMD continue to branch out. And so they continue to benefit from a lot of these long-term tail ones. And you look at the results for the quarter. They speak for themselves, I think.

Revenue, you look at first quarter revenue grew 71%. right to a record $5.9 billion. But if you back out the Xylinks acquisition, organic revenue was still up 55%. They grew gross margin, seven percentage points to 53%. And that is in part thanks to the higher margin Zylinks business. And that all brought down to the bottom line there, earnings per share of $1.13 versus 52 cents from a year ago. And so the two main segments of the business, computing and graphics, saw tremendous performance there. Revenue grew 33% from a year ago. The enterprise embedded in semi-custom segment revenue grew 88% from a year ago. And some of that was driven by very strong performance in things like Xbox and PlayStation,

as that console refresh really took hold. And AMD plays a big role there. And so you see the Xylinks acquisition is integrating nicely. They announced they are also going to be acquiring another company for about $2 billion called Pensando or Pensando, whichever way you put it, but that's going to give them more exposure to the data center opportunity, which then again speaks to the multiple tail ones that I think will help drive and be higher in the coming quarters. After the break, we got the latest on real estate, FinTech and more. So stay right here. You're listening to Motley Full Money.

Welcome back to Motley Full Money. Chris Hill here with Jason Moser and Ron Gross. Zillow's first quarter revenue came in higher than expected, but costs are rising. for the online real estate marketplace. Shares of Zillow down more than 10% on Friday and hitting a new 52-week low run. Yeah, weakness in the business and the stock continues as management attempts to put the house buying and flipping debacle behind them. They are attempting to paint a rosy picture with comments like, well-positioned and prepared to forge ahead. Okie-doke. You know, these financials admittedly are a little bit hard to decipher because that eye-buying

business is still flowing through the income statement, but it won't continue going forward. So I think it's best to ignore it from an analytical perspective and just focus on that advertising and marketing business, which is their legacy business. It's their IMT division. That was up about 10%. So that's not too bad, but it's not that big a business. It's a $490 million revenue business, but it was up 10%. The IMT segment had a $108 million profit that was actually down 24% from last year. So to get a picture of Zillow, that's the segment you need to focus on. They do have a billion-dollar share or purchase program in place.

This is important. Management has 2025 targets of $5 billion in consolidated revenue and 45% EBITDA margins. That would give them $2.25 million of EBITDA in 2025, which would have them trading today at a pretty cheap four times 2025 EBITDA estimates. Do not believe it, folks. No way is that going to happen. Block, the FinTech company, formerly known as Square, out with first quarter results that were lower than Wall Street was expecting. But the company said its cash app business is going well.

So, Jason, what stands out to you when you look at Block? Well, how do I follow up doubting Ron there? I mean, that was terrific. I mean, Block, it was a good quarter. I mean, you know, it wasn't great, wasn't bad. It was a good quarter. Total net revenue of $3.96 billion dollars. That was down 22 percent from a year ago.

But most of that was driven really by the decrease in Bitcoin revenue. If you exclude Bitcoin, total net revenue was actually up 44% from a year ago. So not bad. Gross profit, $1.3 billion. That was up 34% from a year ago. And if you look at the drivers there, cash app generating $624 million, that was up 26% square, generating $661 million. That was up 41% a year ago. exclude the afterpay acquisition. Those numbers come down a little bit, but regardless,

the core business performing very well. Transaction-based revenue, $1.23 billion for the quarter. That was up 28%. And then gross profit, there was $514 million. That was up 19% from a year ago. And they processed $43.5 billion in gross payment volume. That was up 31% from a year ago. So I think this is a business that continues to perform very well. I do think it's worth noting. And, I mean, this is not to say it's a good thing or a bad thing, but it is a bit of a Bitcoin-centric story developing here for sure. And so investors just want to be aware of that. Some people feel very strongly about crypto and Bitcoin one way or the other. It's just to quantify that. I mean, Bitcoin, the word Bitcoin was mentioned 81 times in the shareholder letter this

quarter. You go back three years, it was just 17. So, again, not saying that's good or bad, just try to understand the direction this business is headed, because it is becoming a much more diversified business than what we saw come public several years ago. Under Armour started its fiscal year, not with a bang, but a whimper. Week first quarter results came with the company warning of more supply chain problems in China. And on Friday, shares of Under Armour hit their lowest point run in over a decade. Oof, not good.

Had some decent momentum during the COVID years, but they've basically given all that back, at least in terms of the stock price. quarter weak guidance, slamming the stock. This quarter largely impacted by reduced demand, supply change disruptions, as COVID caused China and some other areas to basically shut down. 14% decline in revenue from their Asia-Pacific region that generate about 15% of revenue from that region. Also, shipping delays and labor shortages hurt their ability to get products to search stores, forcing them to cancel orders. Overall revenue only up 3%. Adjusted operating income was only 11 million. They reported a net loss of 3 million. Profit guidance was way below expectations.

Trading it only 15 times guidance. So that's interesting if they can get some traction. And you want to take a nibble, okay. I honestly have no clarity to see how that would turn out, though. So buyer beware. It's trading it 15 times guidance. It's at an 11-year low. Shouldn't it be trading at like, I don't know, one-time's guidance? Underarmor. More like underperformer, am I right? Starbucks is suspending guidance for the rest of the fiscal year due to uncertainty

in China, but same store sales in the U.S. rose 12% in the first quarter. Shares of Starbucks up a bit this week, Jason, and this new CEO, Howard Schultz, really seems to be off to a good start. I tell you, he's an up-and-comer, you know. It's funny you say that. One thing that really stood out to me in a call is that, you know, you know, it's a call is that Schultz seems like he's kind of pumped to be back. I mean, you'll love to see the enthusiasm like that from a guy who really has kind of been around the block now a couple of times

already. But I mean, I think this is another, this is a watershed moment for Starbucks here, is it works to really fully adapt to this new hybrid economy. Things become more digital, more convenient. You hear a lot of talk in the call about Starbucks becoming this new digital third place. So talk of Web3O and NFT. you even saw on the call there, which is just interesting for a coffee company. But the business itself, I think, really performed very well, given the situation, revenue of up 15%, to $7.6 billion in earnings per share of 59 cents down just slightly. Domestically, they saw good performance internationally. They saw a little bit weaker performance. But you look at 5%

growth in transactions, 7% ticket growth in North America. And they're seeing a lot of, a lot lot of strong receptions to things like mobile order, pay in advance drive-through, right? I mean, that's driving a tremendous amount of volume. They are seeing, they're feeling a pinch from the global supply chain issues, no doubt there. And I think that going forward, Howard Schultz has a few things on his plate that he needs to knock out, right? One being leadership, right? He's not going to be there forever. The idea is to be able to hand this off in 2023, but really making the investments in the workplace and the workforce. We're seeing a lot of headlines regarding unionization, and that's something they're trying to stanch

in understandably. So they feel like they can make better, more bold investments in their workforce and workplace without the unions. And then China. China is a total black box at this point. Revenue there declined 14 percent. Sales comps declined 20 percent from the same quarter a year ago. And that forced them to just pull back on guidance because they just don't have the clarity there. But it really does feel like there's a lot of enthusiasm behind what Schultz hasn't played here. I'm excited to see how Starbucks works out here. I felt like Schultz was throwing Kevin Johnson under the bus a little bit. I'm on record as being a big fan of Kevin Johnson. If I was wrong, so be it. But I still, to this day, remain

a fan. All right, Ron Gross, Jason Moser. Guys, we will see you later in the show. Up next, our guest, Malcolm Etheridge weighs in on the Fed, commercial, real estate, and more. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money. I'm Chris Hill. Malcolm Atheridge is a certified financial planner. An executive with CIC Wealth is also the host of the Tech Money podcast, and he joins me now. Malcolm, thanks for being here. Yeah, thanks for having me. I'm glad to be back.

It was a brutal April. It was the worst April for the NASDAQ this century. Thursday of this week, more red, especially in the NASDAQ. We'll get into the specifics in a minute, but when you look at the stock market writ large, what stands out to you? Yeah. So, as you talk about the brutality of the sell-off, the carnage in the NASDAQ, the thing that's most surprising to me is how we're getting this wholesale sell-off of quality tech names, right? So we're not talking about going dumpster diving into the QQQ and even the ARC innovation ETF and getting scraps here. We're talking about companies like Microsoft and AMD and Nvidia, Apple. They have no business getting sold off into the double digits the way that they

have, but they're sort of just a victim of being connected to the rest of the NASDAQ in the greater tech world, as it were. What do you attribute that to? I mean, part of it obviously is the last dozen or so years have been, for the most part, a bull market. Is that what's driving quality companies getting sold off? People just saying, look, I've had a good run for 10 years or so, and I'm going to take some money off the table, so to speak. Yeah, a lot of it is indexing, man. So, you know, most of us own some kind of fund, whether it's an ETF or mutual fund, that has a mandate to it that says if this, then that. So if the market falls 2%, then sell this much of that. And as the market continues to fall another 2%, sell this much more of that. Right. And so we keep seeing

these electronic or technological AI-driven triggers down, down, down into the market because so much is computer driven now and not so much, you know, driven by fundamentals or even really technicals more than just I'm now looking for asset preservation. And so if Google, for example, is a major holding in my portfolio and it falls more than 2% on any given day, sell half of it or sell 25% of it or sell 10% of it or whatever it is. I think that kind of algorithmic trading is what's driving things to fall so quickly and so sharply across the board rather than be. very particular about what companies get thrown out. Almost like clockwork, you can count on this narrative when, particularly not the stocks that

we were just talking about, Microsoft, Apple, etc., but younger tech companies, unprofitable software companies, that sort of thing. You can count on people on financial television talking about the quote unquote, flight to quality. Now, it's a lot of, you know, you can count on people on financial television, Now is the time to move to the blue chips, the Johnson & Johnson, that sort of thing. You were on CNBC earlier this week. You recently said that we're now in a stock pickers market. So where should people be looking? I am with you in the sense that there are a lot of companies in there in the market right now

that have no business being in the market. There are a lot of companies that came public in 2020 and 2021 because the SPAC money was there and help them do it. And it made sense for them at the time. And now we're seeing that they're starting to reverse course. And a lot of them, I am certain because we've seen this movie play out before circa 1999, 2000, sorry, we're starting to see conversation where more than just Twitter is a big public tech company that's going to go back private by some PE money, right? And so I think that that's part of it. But then also as you talk about the flight to quality and folks wanting to be in the blue chip names, that means then that that probably is where they

should have been in the first place, right? If I am a person who gets spooked by the NASDAQ being down 25 or so percent year to date, and I consider myself to be a long-term investor, and I am still looking for the trade button, you know, on the day that I notice, you know, my portfolio has dropped significantly. That means I probably had no business in some of those names I was in anyway, and I let somebody They talked me into them or I talked myself into following a crowd I wasn't really a part of. And you should have been in those quality names all along. But then you also have the folks who are in, even the blue chip dividend payers, the stall warts, as they were, right, the Warren Buffett stocks, that the market is down for those too, right?

I mentioned it's a wholesale sell off. Everything is getting whacked right now. And so the folks who are in those bigger blue chip names are even feeling some heartburn and trying to decide, should I stay or should. I go. And so I think what's probably, you didn't ask me this, but I think what's probably holding the market up even where it is right now is just the fact that there's no better place to be, right? So we talk about the fact that the stock market is working against us, but the bond market isn't really all that great right now either. And so there is no flight to safety, flight to quality,

sure, right? I can go find better tech names than, you know, some of the things at the bottom of the NASDAQ, but there's no flight to safety necessarily other than cash. And with inflation roaring above 8%, even cash is trash. And so it's like, still, the stock market is showing itself as like the least dirty sock in the hamper. And if I got to be somewhere, I might as well at least be in the place that is going to pay some dividends. And at some point, we imagine we'll reverse course. Thank you for the image of the hamper. Let me go back to the SPAC companies that you referenced from the last couple of years, because a lot of people are looking at how far the NASDAQ in particular has fallen this year. A lot of people looking around saying, okay, are we at the bottom yet?

Are we at the bottom? Do you think, and I'm not asking you to call the bottom, but do you think we get closer to the bottom when those companies, some of whom, as you said, had no business being public in the first place, start to just cash in their chips and say, we're not doing this anymore. And we'd like to find a way to exit the public markets. Yeah, I think two things will happen. One, this is a great time to be in the private equity space, especially if you're a firm who focuses on tech companies, because there will be quite a few who are having backroom, back channel conversations about what will it take to take us private. Especially those that are founder-led companies where the CEO was the one who convinced

everybody in the first place via S-1 and everything else, this is the company to park your chips. For those founder-CEOs who their board is now starting to turn their gaze to them and say, now what? Their saving grace is going to be finding a PE shop that's willing to take them back private and allow them to catch their breath for a couple of years and then probably come back and do it again. But separately from that, I think what we'll also see is a few companies doing the opposite, which is coming public now still into a terrible market at a down round. So companies that are VC backed right now where their early investors and their VCs are saying,

I don't even care if I don't see that 10x, 20x return I was promised once upon a time out of this company anymore. I just need to get something because the day of reckoning is here. they're going to force those companies to come public, even at a down round, like I said, and that's going to be another thing to look at to say, all right, if this kind of activity is happening, we can be almost as certain as certain can be in the stock market that this is where scraping the bottom looks like. And I don't think we're quite there yet, but I have started to read through certain outlets that those conversations have been had in the background. We've talked about the market. You mentioned inflation.

When you have conversations with your clients, what are the types of things that you're hearing from them? Are there any common themes from what you're hearing? Yeah. I mean, for the most part, clients just want to know, okay, you've told me how bad it is. Okay, you've told me where the bad is. Now, where do we look? Where do you see positives in the market? And so as financial planners or asset managers, one of the things that clients are always looking to us for is the better idea. Like, where do we go now? And so one of the places that we are, are pretty overweight and pretty bullish about is commercial real estate and specifically in the industrial space and even more specifically distribution centers. So distribution centers are

popping up everywhere. I don't even live in the suburbs. I live in the city. And distribution centers are being built, you know, less than 20 miles from my house. And that's a place where landlords have pricing power. You know, they have the ability to raise rents at a moment. notice almost to keep up with their inflation and also the supply chain is still broken. So all of the disruptions to air, ground, and sea freight have basically been a tailwind for any company that has distribution centers and industrial reits in its portfolio. And so that's a place that we've kind of turned our gaze on behalf of those clients that are like, you know, tell me where we go from here. If you just told me I can't buy Apple and expect that to

be the lottery ticket that's going to do it this year. You mentioned the supply chain issues. You add that to inflation. We haven't even touched on the rolling lockdowns in China and how that's affecting global companies as well. When you think about the next few months, even to the end of this year, what are you going to be watching to give you a sense of both the economy and the stock market? Yeah, the main thing for me is going to be what the Fed actually manages to do with this interest rate hike equation that it's trying to solve, right?

They, they, if you think about a car going down the highway, 20 miles over the speed limit, and all of a sudden in a distance, you see a police car sticking out and you've got to make this calculus of like, do I slam on the brakes completely? No, because the car behind me is going to run into the back of me. do I keep going as fast as I am? No, because then I'm going to get that ticket. How do I hit the gas just subtly enough that it brings me in under the speed limit before I get to the cop and the radar gun? Not that you know anything about this, Chris, but I happen to have a heavy foot. So I think that's the calculus that the Fed is having to make. How do I land this thing smoothly without causing that bad chain reaction by me slamming on the brakes? And unfortunately, I'm not convinced that they can.

I think we let the party go on so long, and the market was appeasing for so long that we're probably beyond the point where they could kind of just climb back down the other side of the mountain carefully. Now we're really just, in my opinion, at a point where we've got to say, look, let's just rip the Band-Aid off,

have the pain in the short term that we know we're going to have, and then get beyond it as quickly as possible, right? You're a runner, so I know you'll know this. this analogy I'll throw at you because, you know, I love analogies. It's kind of like where I hear sports doctors talk about the planar fascia injury, where you can keep on running on it and letting it tear slowly and slowly and slowly until one day it finally pops. Or you can just come in here, let us snip that bad boy. It'll heal itself back up pretty smoothly. It happens all the time. And you'll get right back to running, you know, like you were in a few weeks time. And so that's kind of

where we are. It's like we're trying to continue to limp along on a bad foot instead of having the surgery, going through the pain, and getting back on the right side or right sooner than later. And so we'll see if they do successfully land this thing through these incremental cuts that they're trying to do. I'm just not as convinced as Jerome Powell and his crew that they will be able to successfully do this, especially not after they gave us transitory for a year and then took it back. Last thing before I let you go, earlier in the year on your podcast, you had an episode called 10 Financial Commandments. You teased a book that you're working on.

I'm just wondering if you can share a little bit more about that and possibly provide an update. Yeah, so it's basically a book that I'm finishing up right now. I'm probably guilty of over-editing at this point. It could and should have been out already, but it will be out before they're going to be out before this year is over. But what it is essentially 10 of the things I find myself saying to people most commonly. By people, I mean high-earning young professionals who are trying to get started and figure out where

do I go. Basically, you know, my peers who call me and ask for advice on, you know, what do I do here? One of the core tenants in the book, for example, is don't invest in things you don't actually understand. I think that's pretty apropos for where we are today. And it's something I've been saying to them even through 2020 and 2020. where GameStop was the thing, and all of a sudden now it's not, right? So my focus was only invest in things you can actually understand,

and if you could explain it to a 10-year-old, they would understand it. So the book is basically that. It's me expounding on some of the core things that I find myself talking about all of the time to people to the point where I said, I should probably share this a little more broadly and not just in my I-Message group chats and in Slack. and those kind of things. You can find the Tech Money podcast wherever you get your podcast.

Malcolm Etheridge, thanks so much for being here. Thanks for having me. Coming up after the break, Jason Moser and Ron Gross return. They got a couple of stocks on their radar, so stay right here. You're listening to Motley Fool Money. As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy yourself stocks based solely on what you hear.

Welcome back to Motley Full Money. Chris Hill here once again with Jason Moser and Ron. Ron Gross. Guys, who among us has not once in his or her life accidentally poured orange juice on our breakfast cereal? The innovators at Tropicana are trying to help with Tropicana Crunch, a honey almond cereal designed specifically to pair with orange juice, not milk. The company gave away boxes as a promotion on social media. Ron, I don't know. Do we give them points for trying here? They did it for National Orange Juice Day, which who knew was the thing? So it's clever-ish, but I just want to say the idea of maybe getting the extra pulp orange juice and pouring that on could literally make me gag.

So stick with the no pulp orange juice if you're going to go anywhere near this cereal. Jason, can I interest you in this cereal or no? No, no, I'm good. Not the biggest orange juice guy. I mean, I give them points for trying, but I do want to at least harken back. And of course, I'm dating myself here. But some will remember back in the days of your, the Wheaties commercials. And I think at the time, it was Bruce Jenner, pouring orange juice over his Wheaties in the commercial.

That led me to try that once, Chris. And I emphasize once. Let's go to our man behind the glass, Dan Boy. Dan, before we get to radar stocks, any thoughts here? I've read the article that you sent about this. And I do want to say that they're hedging their bets big time with this orange juice cereal. Multiple times in the article, they talk about how it's an unforgettable breakfast experience and things of that nature without saying, hey, this will taste good because even Tropicana knows that, no, it will not.

It will be unforgettable. Let's get to the stocks on our radar. Jason Musher, you're up first. What are you looking at this week? I know you think I made this company up, but I swear to you, I didn't. Outset Medical, the ticker is OM. Everybody I think here has heard, at least of dialysis, outset medical. is in the market of dialysis and specifically their tablo-hemodialysis system, which ultimately is to simplify the process and help make it more accessible, right? I mean, they've got dialysis systems for the home, as well as acute care in hospital settings.

But the company just recently announced earnings, and they continue to perform very well, grew revenue 33%. They now project revenue for the full year between $144 and $150 million. That would represent a 43% growth at the midpoint there. They are growing that in-home presence, which I think is really important as we move more towards healthcare and the home and virtual health care, remote health care. And they also just announced recently a new source for cartridge production, right? They had that razor and blade model. That will help bring the costs down while helping to inflate those margins.

Dan, question about outset medical? I'm looking at the stock price here, Jason. the recent good news for outset medical does not seem to be reflected in how the stock is performing. Well, Dan, you know, it seems like recent good news for any company isn't being reflected in their stock price these days. But you raise a good point. This is a very young company that is still working its way towards gaining market share and profitability. So I suspect we'll see a good bit of volatility along the way. Ron Gross, we got one minute left. What's on your radar? Domino's DPZ, a long time favorite of mine, but I only recently bought it back in January because

It was down 22% from its high. Guess what? It's down another 22% from that price. But I'm still a believer. I think it's a very well-run company. They're just going through some changes here as a result of COVID waning. They're going to lean on carry out more. They're expanding driver hours using call centers, possibly partnering with third-party delivery apps.

I hope that doesn't happen. Now trading it 25 times, much more reasonable than the 40 times it was trading at for quite some time. Dan, question about Dominoes? Remember when Dominoes did this national ad campaign talking about how their pizza isn't terrible anymore? Guess what, America? It's still terrible. They tricked you. It's salty cardboard and waxy cheese.

It's bad. Go get local pizza. Tell us how you really feel, Dan. Safe to assume you're adding outset medical to your watch list? You got it in one, Chris. Jason Moseer, Ron Gross. Guys, thanks for being here. Thank you, Chris.

That's going to do it for this week. show. Show is mixed by Dan Boyd. I'm Chris Hill. We'll see you next time.