Motley Fool Money - Motley Fool Money: 02.15.2013

Episode Date: February 15, 2013

Berkshire Hathaway and 3B Capital buy Heinz.   Comcast buys the remaining stake of NBCUniversal from General Electric.   Our analysts discuss those stories and share three stocks on their radar. ��Plus, corporate governance expert and film critic Nell Minow talks Apple, Academy Awards, and the future of television. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Thanks for being here. I'm your host, Chris Hill, joining me in studio this week. From Motley Full One, Jason Moser, from Motley Full Income Investor, James Early, and for Motley Full Asset Management, Tim Hanson. Good to see you guys. Good to see you, Chris. Always good to see you. We have got some big deals this week in the consumer goods industry, the entertainment industry.

We will break those down. We'll dig into some more earnings news. And as always, you've got a few stocks on our radar. But let's start with maybe the biggest deal of the week. Berkshire Hathaway and 3G Capital are buying Hines for $23 billion in cash. Shares of Hines were at an all-time high, James, and Warren Buffett felt compelled to pay a 19% premium on that. So my first question is, did he pay too much? Well, it depends, Chris. I mean, I'm happy as an income investor advisor because I recommended Heinz and now it's up 20%.

And we finally got a chance to see what Warren Buffett's elephant gun looks like, which is pretty cool too. But this deal to me smacks more of okayness than genius. The fuzz factor, to answer your question, is going to be how much fat these 3G guys can trim who are going to come in and manage this company can trim from this business. Heinz has been cutting costs for many years. so I don't know how effective that's going to be. I don't think it'll be a disaster. I just don't see it being a huge success either. What about you, Tim?

Well, this is another one of those deals that only Buffett could get. I mean, the way it's being financed is he's getting some preferred shares that are going to pay, I think, a 9% dividend, which is, you know, in an era of zero interest rate, right? Yeah, that's not too bad. I mean, that's a way to put a lot of money to work at a market, probably a market-beating rate. So I think it probably works out well for him. He's got some equity to share on the upside if 3G can cut costs like they did it at Anheiser-Bush. But it does look at first blush to be a little bit expensive, especially because I think Heinz is on the wrong side of where the food trends in this country and to some extent globally are going, which is more fresh, you know, tight foods and they're heavy into the canned and prepackaged and pasteurized type of things.

You're saying tater tots are not fresh? I mean, it's debatable. They're delicious. I don't know, are they? Sure. Who doesn't love tater tots? I'm not a big tatertop fan. I mean, it's probably going to be some mail that comes in about this, but, you know, I think tater sat for overrated.

I was in Quebec, and I was, my son had just turned one. I needed baby food. I bought all this Heinz baby food, and he wasn't eating it. I realized, like, tomato paste was like the number one ingredient in every single thing. James, when you look at Berkshire Hathaway stock, it is trading at an all-time high, even after this deal, which tells me that, you know, some people think, well, you know what, it's Buffett and we're going to trust him. What do you think of the shares? Buffett is always going to get the benefit of the doubt. I mean, my concern, I think, is legitimate. He's not going to live forever, and what's going to happen? I mean, it's just I wouldn't be a buyer now, just for that reason.

Comcast, as of the beginning of the week, owned 51% of NBC Universal, and apparently, Jason, they liked it so much. They decided to buy the remaining 49% from GE for the tidy sum of $16.7 billion. And similar to... to what I just said about Berkshire, I think people think this is a great deal because both stocks were at multi-year highs in the wake of this deal. Yeah, I think on the surface of it, it's a good deal for Comcast. I mean, in this age of cheap money, it's not like it was a surprise they were going to do this. They just kind of sped up the timeline.

But it gives them, you know, makes them a little bit more vertical, gives them a little bit more control over content in an age where content costs are going up, but they still also benefit from the cable and the network side with generating higher affiliate fees. I think not to get lost in this is the benefit for GE, because ultimately they're going to get out of a business that I don't think they really had any business being in to begin with. And you look at the stock over the past five years, and GE has woefully underperformed the market. And this is going to give them a chance. I mean, their focus is their intention to return $18 billion this coming year to shareholders in the form of buybacks and dividends. So, you know, if you're a shareholder of GE the last five years, this has got to at least be encouraging news.

Woefully is always a good word to work in. It is. It's really bad. Well, and to that point, Jeff M.L., the CEO over at GE, really seems to be executing on this plan of focusing the company a little bit more and really getting away from the days where GE Capital was the main driving force for that company. Yeah, and it makes you kind of think of that Peter Lynchian term diversification, right? I mean, when companies just start going so far out of their circle of competence that it really

just makes the collective business worse. and I think that GE had probably gotten to that point. So hopefully this will get them a little bit more focused. GE Capital is more of an accident, right? I mean, people just couldn't afford refrigerators a long time ago. So it just started financing those appliance purchases, and it just grew and grew and grew and grew. It's kind of interesting.

The proverbial happy accident. Tim, we also saw a bunch of other content deals. I mean, this was the biggest this week, but we saw Stars and Sony Pictures, Amazon working out a deal with DreamWorks Animation, Amazon and CBS, they all sort of came in this flurry. And it just seems like the battle for the living room that we talk about from time to time is just getting more and more amped up as everyone is looking for a dance partner when it comes to content. I think that's true.

And I think it raises two questions to think about going forward. The first is, you know, why aren't these people who are creating the – why are they so eager to license when, in fact, they could probably be thinking about distribution on their own? And that might be more profitable for them. You know, instead of yielding to Apple, for example, your entire song catalog and let them make money on the hardware and the software and the network effects and the ecosystem competitive advantage, you know, why not do something like that on your own? I think that's one good question that these content companies should be asking themselves.

You know, the second is when does Google and Apple and these companies, when do they start coming after sports? You know, right now ESPN is notoriously, you know, a Disney unit, you know, owns the rights to most major sports broadcasts, and they pay a lot for it. But if Apple has a TV in the works and they want to bid for the Super Bowl, and that could get really interesting because they have a lot of money, and that would be a really powerful form of content that has not yet gone into play in this area. Yeah, I think Tim Keyes in on something very important there was sports. And Comcast did just sign a deal with Fox, sort of it's in that TV Everywhere strategy,

and soccer was included there. So I think at least that's a small step toward that direction. So I wouldn't be surprised to see maybe a little bit more of a focus there going forward, Because that really is what, I mean, cutting the court is a great headline and all, but most people aren't cutting the core because sports is such a tether there. But networks are not as necessary as they used to be, which I think is 10th point. Absolutely. Jason, what do you think of Comcast, the stock? Because this is a company that as often as not shows up in the news for being one of those big companies that does not have great reputations with customers.

And yet now, it seems like just from a business standpoint, they're really. really kicking a lot of ass. Yeah, I mean, the business performs very well. I mean, historically, it's done very well. Going forward, it's a little bit more questionable, though, because the landscape is changing so quickly with digital distribution and streaming and your other concepts out there like Netflix and who knows what Apple's going to be doing here at Google to a degree. So I think going forward, it's a little bit less clear, but for sure, the company to this

point, it generates a lot of cash and really has a lot of whole. over their subscribers. I do think you need to be careful as a long-term investor in buying shares of companies whose customers would probably think life is better off without them. And this refers to like the Verizon's of the world, the Comcast. I mean, I'm a Comcast customer out of necessity. If I could do Al-A-Cart cable or if, you know, sports were available via the app store, I would unsubscribe from Comcast very, very quickly. And so I think that's always a specter hanging over the stock. U.S. Airways and AMR, the parent company of American Airlines, have agreed to an $11 billion merger that will result in the largest airline in the world.

And, Tim, contrary to the previous deals, it seems like people weren't psyched about the shares of U.S. air were down. So apparently bigger is not better. Well, these are also, I think, generally regarded as being two of the weaker airlines in the U.S. market. And that's particularly true of American with their labor troubles. I mean, they've had big problems. And being a weaker part of an airline industry in the U.S., I mean, that's saying something, right? That's a low bar. You know, airlines are famously horrible investments, especially in the United States.

You know, the joke is, how do you become an airline millionaire? You start with a billion dollars and buy an airline. You know, but the industry is rationalizing. I think we're now down to three hub-and-spoke carriers after United and Continental merged, and now you've got the American and U.S. Airlines merger. People are still traveling a lot at some point. these companies, they have to start making money, right? Chris, am I wrong about that? I don't know. It does seem like one of the potential ripple effects is maybe a benefit for JetBlue and Southwest on the smaller ones because because of the size of this airline, they're going to have to, the regulators are probably going to force them to give up some short space.

You probably do get some more gates if you're looking for them, if you're Southwest, for example. But like I said, travel has been a constant, you know, even during the recession, people kept. traveling and and obviously they traded down a little bit on cost you know but people like to travel and it's a much more it's going to be a much more rational industry going forward over the next 10 years it looks like than it was over the past time American Express announced a partnership with Twitter that would allow cardholders to buy things simply by typing a hashtag on Twitter and Jason your shareholder you're a cardholder of American Express you've already tried

this I did try yeah well I've tried it in two capacities the first was six months ago or so when they initially were allowing you to just retweet something and actually benefit from a deal. So it was a coupon going to a restaurant. But I didn't actually have to present a coupon. I just used my Amex. And then the next day they deducted the $20 off the card. This is, this is, you can actually purchase things if you just include the hashtag and then the verbiage of the deal there. And I tried it with their initial $25 gift card. And apparently they had just run out. So I kind of missed the boat on that one. But I've seen a lot of tweets go through my Twitter feed today from Amex. They are pushing a lot of these Kindles and Sony

PlayStation devices. So, yeah, I mean, I think that they are recognizing the fact that e-commerce and social networking go very well together, and it's just a matter of how to make it work best. And, you know, honestly, this is something where I like a Twitter more than I like a Facebook, because I think Twitter is really more or less solved that mobile barrier already, because the platform really just works with mobile, whereas Facebook is really trying to overcome that mobile barrier still. And so I think it's potentially Facebook could probably be taking a few notes from this. Let me just make sure I understand.

So you get the deal if you retweet the deal to a bunch of your friends? But no, he didn't get the deal because they'd just run out. That's the card dealer model. The deal is you retweet. But if you want to buy something, this is the new one, is it going to buy something. You actually tweet the hashtag with the deal after the hashtag. But you still have to spam your friends, basically. I guess that's a good thing.

It's kind of like impairing the friendship to a minor degree for money. Potentially. That's assuming that the people following you on our Twitter are. actually your friends. Good point. Tim, you seem skeptical of this whole this whole scenario. You know, it is

what it is. I think companies will be rewarded for experimenting with these media because there are lots of people using them. I don't think anyone has figured out how to effectively market to them. As James said, there's a really fine line between, you know, intrusion into the life of a customer

and their friends. And Facebook, I think, is managing this really poorly because on like Twitter where your followers a are not necessarily all your friends. On Facebook, by definition, right? They are. You're supposed to be. So that's a little bit, I mean, you're turning into kind of a multi-level marketing scheme

by pushing product on your friends, and those generally don't work out too well. But I'm sure it's a very small marketing investment. So, you know, it's hard to criticize a company for experimentation. How would you feel by Jason if he tweeted you a deal? Like, would that impair your friendship? Yeah, yeah. I mean, because you think about it, if you think about sort of the math equation of it, it's like Jason basically assumes that my time is worth nothing. But he's worthy, and he would appreciate taking advantage of my time in order for his own personal benefit.

But if I was tweeting a deal about basketball shoes or perhaps a beer that he likes. But you can't tweet it. Then at least it maybe takes on a personal dynamic. You have to tweet the same deal to everybody. You can't target just a specific person. Well, I imagine. Well, I think you would actually have to direct that tweet to that individual. Yeah, but you can't in theory do that.

But I'm just saying like if it was a basketball shoe or a beer that I know he likes, otherwise I might not directed his way. This is probably a good time to mention you can follow us on Twitter at Motley Full Money. Coming up, if a big asteroid is going to hit our planet, shouldn't we at least figure out how we can profit from it? Stay right here. You're listening to Motley Fool Money. Hey, it's Chris here. Is your business protected from data loss?

If not, join the 80,000 businesses who trust Mosey to protect their important information. Mosey automatically backs up your critical files to world-class data centers with maximum security. It's easy to use and costs up to 80% less than other solutions. Learn more at Mosey.com. That's M-O-Z-Y.com. Mosey, it's always there. Welcome back to Mottleyful Money. We're still here in studio with Jason Moser, James Early, and Tim Hanson.

Let's hit the beverage companies, James. Coca-Cola's fourth quarter profits up 13%. Pepsi's fourth quarter profits up 17% and for a number of reasons, it looks like Pepsi's doing a little bit better lately. Yeah, they are doing better. Pepsi had been focusing on healthy stuff for many years, Chris, until it realized that people actually don't want healthy stuff. Yeah, that's a mistake. So it went back, it reembraced its junk food roots and just sort of went to the bad side. It kind of reminds me when Hulk Hogan became a bad guy wrestler. You know, Pepsi did surprise Wall Street, 5% organic revenue growth, 1% drop because of foreign exchange. But profits were strong across

the board sales gains, organic sales gains, and all its category. So it's doing very well. Coke missed expectations, not quite as good. Weak in China, weak in Europe, still having a decline in North American sodas. I think both companies are solid long-term investments, but they're both priced a little bit richly right now. How big a threat is the whole obesity discussion in the United States? If when you look at these companies, in terms of revenue, most of their revenue is not coming from inside the United States. That's true. North American's soda volumes, even now, are still going down. We're drinking less Coke and less Pepsi, but it's still a material chunk, and it's something that can spread

worldwide. I mean, other countries are trying to now cut back on cigarettes, for example, and they're going to start cutting back on the junk food that we're exporting. I mean, they're seeing cancer. They're seeing the same American diet-type diseases that we've had that they didn't have, the rates they're having now. I mean, but both companies have also sought to mitigate that by buying up substitution products. You know, Coca-Cola has honest teas, for example. And so to the extent that Coke consumption declines, they've got something else in the works that they can start producing and distributing. Moving to the healthier side, Whole Foods, first quarter profit rose 24 percent, same store sales, we're up more than 7 percent. And yet, Tim, good numbers, but not good enough when you consider the stock fell 10 percent on Thursday.

I think Whole Foods investors, and I'm a fan of Whole Foods with the company. I think it's a great grocery store. having said that, Whole Foods investors need to look in the mirror and remind themselves that it's a grocery store. You know, and it put up 7% comps. It has best in industry profit margins. They're opening, you know, 35 new stores next year. By all measures, this company is operating fantastically. And the stock was down 10%. And probably, arguably, has another 25 to 30% to go before it's valued like a great grocery store.

I mean, I don't know what Whole Foods would need to do to justify. its valuation. I mean, it would need to do something wild and crazy, but it's just a grocery store, people. So you're waiting for more of a pullback. Yeah, I mean, it's like, you know, people obviously put a premium on greatness. And so Whole Foods should trade for more than Walmart, Kroger, Harris Teeter, these types of companies. But you're not ever going to get 10 to 12 percent operating margins at a grocery store. It's just the business doesn't work that way. Fourth quarter revenue for Buffalo Wild Wings rose by 38 percent, and same store sales were up nearly 6 percent. Kind of an interesting week for the stock, though, Jason, when you consider that on those numbers, again, good numbers, but not great, stock fell.

But it looks like it's basically flat for the week. Yeah, it was a good quarter and a good year, really. I mean, they passed the $1 billion mark in sales for the first time this year. And, you know, they continue to grow the concept. They're going to be opening up their 900th restaurant. I think next week they were saying it's interesting to see that Sally Smith there sees a market for 1,700 of these stores. I'm not so sure that's a realistic estimate. I feel like it's a little bit robust.

But they are facing some genuine headwinds in chicken wing costs and labor costs and even beer costs. And so really you're seeing the restaurant level cash flow really getting crimped from those costs. And they're trying an interesting new little test out here in a number of restaurants where they're testing wings by the volume as opposed to quantity. Normally we'd go in there and you'd buy six wings or eight wings. wings or whatever, but instead they're saying, well, chicken wings are bigger now. The chickens are bigger for whatever reason. So instead of six wings, you might get five because it weighs about the same. Now, I'm not sure how well that translate to the consumer. It'll be interesting to see sort of the results from this testing. But I think that's what they're facing right now.

That's sort of the trepidation there on the stock. But I feel like at least you're buying into a good leadership story here with Sally Smith. She's been there since 1996, and she's dealt with this kind of thing before. We got about 30 seconds left. We dodged the bullet. And when I I say we, I mean the planet Earth, the asteroid that was hurtling towards us, missed us by about 17,000 miles. But it seems like we've got to come up with something to stop these in the future. If you're betting on a company to come up with, you know, a device to basically knock these things out of the sky. I'm going with Alon Musk and SpaceX. Put some lasers on those things. We solved this problem.

Jason? Certainly there's got to be something out there that 3D printing can do. Chris, I've been doing some research and apparently shooting a nuclear missile will not work, scientists say, But they do recommend trying to paint the asteroid as quickly as possible because the absorption of refraction of the light might change the asteroid's trajectory by a few degrees. So I'll go with Berkshire Hathaway, which has been able to paint. Well, maybe they can partner with SpaceX and put paint brushes instead of lasers on those spaceships. Brilliant ideas, one and all. Guys, we'll see you later in the show.

Coming up, the Business of Entertainment and Academy Award predictions with Nell Minow. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money. I'm Chris Hill. We've got company executives and boards of directors in the news. but we've also got the Academy Awards just days away. So, of course, there is only one person we can turn to.

Nell Minow is a corporate governance expert with Governance Metrics International. She's also the film critic known as the movie mom. Always good to talk to you, Nell. I'm glad to be back. We'll get to the Academy Awards shortly, but there are just a lot of soap operas going on in the business world, and I want to start with Apple, because recently we've seen David Einhorn,

this hedge fund manager, come out and saying, they need to do something with their cash, and they have accusing the company of having this depression-era mindset, and Apple says, you know, Tim Cook says, hey, we're evaluating our options. Do you think there is something to Einhorn's point in terms of Apple having a cash problem? You know, I find myself agreeing with Einhorn. Really? I do. I think that it's an excellent discipline when a company has got a lot of cash.

And, wow, this company has got a lot of cash. to say to them, all right, considering the possibilities is not good enough, unless you've got a very strong idea in mind, we want you to pay that out to the shareholders and then let them put their investment money back into the market in a way that they think is appropriate. The problem is that we've seen this happen far, far too many times, whether you're talking about an individual, whether you're talking about a company, when they've got a lot of cash and they're under pressure to spend it, they make foolish choices.

Can you remember Time Warner AOL? I think I remember that. Yeah, okay. And, you know, this is where I say I always think that there should be a crime of corporate homicide, and they should be guilty of it. And, you know, the problem, as you remember, AOL, they had so much cash, or their stock price was so high and so inflated. They had to put some assets under it, and it just didn't work out.

Now, a lot of people are calling for it. Let's see what the bright people who are giving Apple some alternatives are coming up with. A lot of people are coming up with ideas like they should go into. the content, you know, that has not paid off very well for people who have not been in the content business. Everybody wants to go in the content business. Making it work is a different thing. And there are, you know, people have said, well, they should put it into supply chain. Well, sure. You know, I'd love to see them spend a good bit of that money making better working environments for their workers in China and in the United States. I think I would love to see them put that

back into their own people. That would be great. to me that if there is some opportunity, some strategic opportunity out there for them, I would love to see them have the discipline of having to raise money for it rather than just writing a check. Apple obviously has a lot of options in terms of their cash. They can do, as does any company, I suppose, with cash. You can buy back shares. You can increase your dividend, do a special one-time dividend, that sort of thing.

From your standpoint, when it comes to shareholder-friendliness, what are, as a general rule of thumb, the ways that you prefer to see companies deploy their cash? I don't think it makes a big difference from the shareholder standpoint, whether they do a buyback or a special dividend. So I think either one is fine. Are there any that in your book raise red flags automatically? No. Listen, as I said, I think it's a good discipline to just keep shoveling that money back out to the shareholders. After all, they're the ones. Capitalism is named after the shareholders, not the executives.

Another story that continues to play out is what's going on with Boeing and the Dreamliner 787 battery problems. The CEO and chairman is James McNerney, and he hasn't really suffered any sort of financial penalty or, you know, his compensation hasn't taken a hit as a result of this. Now, obviously, it's under investigation. The planes are grounded. But when you look at Boeing, what do you think is going? on and how do they fix it? Well, this is another I told you so. For us, as you know, my company, we rate boards of directors like bonds in terms of the

investment and liability risk that they pose to investors, and we have had them on our bad list for a long, long time in large part or in significant part, I guess I should say, because the pay structure is just so perverse in terms of its incentives. And let me just tell you that if you're going to pay somebody a boatload of money, or I should say a dream winner load of money, whether they perform or not, then guess what? They're not going to perform because it's harder to perform. So they'll take the easy way. Unless you make it meaningful, and I'm not just talking about the CEO, of course,

but I'm talking about up and down the organization and say, if the plane doesn't work, you don't get the bonus, then we're going to continue to see this kind of behavior. So I completely blame the board. I don't think that they have stepped up to the plate in the way that shareholders expect them to. and I think this is a very serious problem, but it was a predictable problem if you looked at the way the incentive compensation was structured. You're listening to Motley Full Money talking with Nell Minow, corporate governance expert and film critic. A person you and I have spoken about before, Aubrey McClendon, the CEO and co-founder of Chesapeake Energy, I'll be completely honest, now, when I heard the news that he was stepping down on April 1st, my gut reaction was one of sadness.

I felt like, no, no, we're not going to have Aubrey to kick around anymore. We're not going to have me to kick around. You know, the secret hedge fund, the antique map collection that he sold back to the company. And now on the flip side, and some of my colleagues at the Motley Fool have said, you know what, if you step back and look at his full legacy, this is a company that he started on his own. It's now worth more than $13 billion. He deserves some credit for that. When you look at the legacy of Aubrey McClendon, what do you think it is?

is. Yeah, he really is one of the CEOs I love to hate because he's just, he's just been so catastrophic in the last few years. I think one of the big challenges for boards of directors in dealing with founders is understanding when it's time for them to go. And if he had left 10 years ago, he would have one of the great legacies in the last couple of decades. But he didn't, and he got up to all kinds of mischief. And the board of directors, adding insult to injury and adding a little more injury to the shareholders, decided, I knew this was going to happen because they're a terrible board directors. They decided to characterize his departure as a non-for-cause termination rather than a retirement,

meaning that he didn't have to kick back his retention bonus. You've got to be kidding me. He wasn't actually retained. And what value are the shareholders getting from that other $11 million? and he gets all kinds of other money too. So, you know, if there was ever a termination for cause, it seems to me there is plenty of cause here, including the secret hedge fund, and yet they just cannot keep, cannot stop shoveling money into that man's pocket.

In my next life, I really do want to be a former CEO. I think that's got to be a sweet gig. Yeah. Before we move on to the Academy Awards, a couple of questions about the business of movies, and specifically, we've seen some deals this week, starting with no. Netflix, which is partnering with DreamWorks animation to produce an original animated series for kids. And they've gotten really good reviews. Netflix has on House of Cards, their most recent series.

When you look at Netflix, do you think that they're going to be able to continue this transition to original content? Or is that going to be for them sort of just a small slice of the pie? I think that it's a very smart move on their part. I'm extremely impressed with what they did with House of Cards. I've watched three of the episodes myself, and I expect to watch the whole thing. And not only was it, you know, they outbid HBO for House of Cards. And so that shows that they are really willing to sit down at the table with the big boys. They've got Kevin Spacey and David Fincher and is a first-class production,

and then they made the brilliant move of putting all the episodes up at the same time. and understanding, because nobody understands this better than Netflix, that the real revolution in terms of the way people appreciate content through Netflix is that they will sit down and watch an entire season of 24 over the weekend. Binge watching. That is what people like. And when you give them a gripping story like this one, and you say, well, we don't have the water cooler moments.

Believe me, you have water cooler moments for people who say, my God, I spent 13 hours watching House of Cards. And I can't believe what happened. I'm dying to talk to somebody about it. You have to watch it so we can talk about it. I think it was an outstanding move on their part. They've been very, very, very smart about the way that they've gone about it. And that's good because they've been dumb for a little while. It's nice to see them getting smart again. Well, and along those same lines, Amazon just acquired the exclusive streaming rights for downtown Abbey. So I'm assuming they have similar metrics, maybe not exactly the same metrics in terms of people's viewer habits, but they probably have something similar.

Who are you betting on in the battle of Amazon and Netflix in terms of video streaming? That is a real tough call right now, and I would put Hulu in the mix, too. Hulu has produced some small, not nearly as ambitious, small, but really, really interesting content. And so I think right now that's anybody's guess. And finally, one of the huge stories of the week is Comcast acquiring the remaining 49% of NBC Universal, and now you've got this cable provider that now has control of all of this content. The battle for the living room, which you and I have talked about before, it just seems like it's getting more and more complicated.

And yet, with this deal, it seems like if Comcast doesn't have the poll position, they certainly are better suited than most. Would you agree with that? Yeah, I do agree with that. I think it was certainly not a surprise to hear that from Comcast. That was certainly the direction that I think that the original deal. deal was headed in. And so, and plus those guys always like to do their own thing. You know what I mean? They, they have consistently liked to run things without anybody else telling them what to do.

So it's not at all surprised to me, but in the content world, I think we are really in a brave new situation where people are watching series on YouTube for free, and movie studios, movie theaters are beefing up. had a little bit of an uptick by putting in Barkle-Longers and 3D IMAX and all of that. So right now, everybody, it's a great time to be a consumer of content because everybody's fighting for you. You're listening to Motley Full Money talking with Nell Minow, corporate governance expert for GMI, but also the film critic known as the movie mom. Let's move on to the Academy Awards, and we do this every year.

So you know the drill. Let's pick some of the main categories. You tell me who should win and who you think will win. and let's start with Best Actor. Best actor, I think it's a lock for Daniel Day Lewis. If it were me and I were granting the Oscars, I would go with Denzel Washington. I thought that his performance in flight was the best single performance of the year. He's been my favorite actor for many years, but in this role as a pilot with some substance abuse issues,

he exposed a vulnerability and a subtlety that took him further than he's ever done before. So that was just an amazing performance. Am I correct that if Daniel Day Lewis wins Best Actor, that will be his third? Yes. That's going to put him in some pretty rare company, isn't it? Yeah, that's true. But he's up there. He's up there with the Merrill Streep's and Robert De Niro's.

He's great, and he did a remarkable job in that film. All right. Best actress, who do you think should win and who do you think will win? I think that's the least interesting category this year. I mean, it's fun that they've got the youngest nominee ever with Kavanaugh-Wallis for Beas of the Southern Wild and the oldest ever with Emmanuel Riva. She's a little bit of an insider favorite because she's just been around for such a long time doing such classy work. I think it just might go to 22-year-old Jennifer Lawrence, and that would be okay with me.

She's very young, and I don't think that it's of the category of, say, the Daniel Day Lewis or Denzel Washington, but she did a beautiful job in Silver Linings Playbook, and she showed a lot of range last year with that and with Hunger Games. What about Best Picture? Best picture is really up for grabs. If you'd ask me last December, I would have said that I thought it was going to be zero dark 30, but there seems to be a political backlash there. It's interesting to me that of the nine candidates this year, we have so many that deal with Washington, American history, politics. It seems to be a really forefront of people thinking right now.

It could very well go to Lincoln and it could very well go to Argo. Argo has done extremely well in all the predecessors. award. So that's a tough one to call, and they're all good candidates. I guess if we're me, I'd go with Argo as a sentimental favorite. I thought that was the most entertaining and sort of spiritually fulfilling movie of the year, but I would love to see it go to zero dark 30, which I thought was outstanding. Is there, when you look back at 2012, and I know you see tons of movies, but is there sort of a hidden gem in your book, sort of an undervalued movie from 2012 that you think more people should see that maybe didn't go to the theater? Well, if you haven't seen Beas of the

Southern Wild, I would totally recommend that. And Ben Zitland, you know, who's still in his 20s, just might get the best director, Oscar, which would be bizarre, but interesting. I think that also one of the nominees for Best Foreign Language film is called No, as in Yes and No,

and that is an absolutely terrific film based on a real-life political battle in Chile. And Gail Garcia-Bernel stars in it, and it is one of the smartest, most interesting, thoughtful films. I thought that was outstanding. And then of the documentaries, there are two about Israel that I thought were really good, particularly gatekeepers.

We will wrap up with a round of buy-seller hold. Her stock is probably trading at an all-time high right now. Buy-seller hold, Jennifer Lawrence. Jennifer Lawrence is a long-term buy. She is going to be the Merrill Street of her generation. She's absolutely terrific. Wow, that is some high praise. She is the new chairman of the SEC.

buy-seller hold, Mary Jo White? I'm just going to do a hold on her. I'm hoping, I'm cautiously optimistic. I'm really hoping that she'll be, like her predecessor, Joseph Kennedy, the first chairman of the SEC, who, of whom it was famously said by FDR, it takes a thief to catch a thief. You don't hear much about him these days,

but America always loves a comeback story. Buy-seller Hold, the future of Mel Gibson. Oh, he says sell. I think it's going to be a long, long, long, long time before he has a comeback. And finally, this might be not just the most anticipated movie of this year, but really of the next three years because it doesn't come out until 2015. Buy Cell or Hold, J.J. Abrams directing the next Star Wars for Disney. If you can buy, if there are any shares out there left, I would say buy them all.

One thing that J.J. Abrams has shown us is that he knows how to run. revitalize a beloved franchise being true to its past, but taking it into exciting places in the future. So yes, this is somebody who's going to boldly go where no one has ever gone before. Is there more pressure on J.J. Abrams for the next Star Wars movie than maybe any other movie ever? Yeah, I think so. But as my husband says, he can't do a worse job than George Lucas did. And I know a lot of people are very upset, you know, that he's bringing the Star Trek into the Star Wars. But the fact is, you know, he's also done Mission Impossible. He really knows his stuff.

I think he is a fascinating guy. If you have not watched his TED Talk on the mystery box, I strongly recommend it. And I think that he will bring to Star Wars what George Lucas forgot, which is humor and great dialogue. She's a corporate governance expert. She's a film critic. She's our favorite guest on Motley Full Money. Mel Minow, thanks so much for being here. My pleasure.

Coming up, we'll give you an inside look at the stocks on our radar. You're listening to Motley Full Money. 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 it against. So don't buy ourselves stocks based solely on what you hear. I'm Chris Hill. Joining me in studio once again, James Early, Jason Moser, and Tim Hanson. Before we get to the stocks on our radar, I should mention, you can always drop us an email. Radio at Fool.com is the way to get a hold of us. Radio at Fool.com. Drop us a note. Ask us a question. Way in, particularly if you have thoughts on how we can stop asteroids

from destroying our planet. Let's face it, Tim. We need all the help. That sounds like a White House petition. I'm not looking to involve the government. I'm just looking for, you know, just citizen action. You're up first, Tim. Stock on your radar this week? I'm looking at a TD Ameritrade, which is a discount broker. They released their January sort of account activity metrics. And, you know, assets there continue to rise, as you'd expect in a rising stock market. Investors are getting a little more active again. they're doing some investor education, and they're sitting on a lot of cash balances in their accounts.

It's like a bank in some ways. So if interest rates do start to go up, they'll earn a lot more in interest income. So I think there's basically two kickers there. One is more activity in the stock market, more bullishness, people trade more. That's good for them. And then interest rates maybe start to go up as the economy improves, and that's good for them too. And so they could be making a lot more money three years from now than they're making today. And the ticker?

AMTD. Jason Moser, what do you got? I'm going to go with National Oil. Well, Varco, they just repeated, reported their quarter here. And while it was a good quarter, the stock pulled back a little bit. It looked like there were some margin concerns there in their rigged technology segment of the business, which is their biggest moneymaker. But with that, they reported a lot of new business, some growth in the backlog, growth in new orders,

which I think portend an act of 2013. And to top it off, James's asteroid killer, Berkshire Hathaway, keeps adding to their position. So I think, you know, when you see Buffett buying a stock like that, you might want to take his key. You know it's Buffett? I mean, there are a lot of guys now pulling the strings there. That's a good point. That's a good point. James, what do you got this week? Chris, waste management is a trash company. It's an income investor recommendation. It has been... Also a Berkshire pathway... Delivering a mildly disappointing results over the past several years, let's say.

And it just relates to another batch of mildly disappointing results. But at some point, the mildly disappointing results have to stop. Construction volumes are down, and that affects trash volumes more than people might think. But this stock pays a 4% yield while you wait. It's so mildly disappointing. It's not wulfle, though. It is not wulfle. That is a very well-put phrase, Chris. Wow.

Is TD Ameritrade also in the Berkshire Hathaway holdings as well? Because they're out in Omaha. They are out in Omaha. I do not believe they are a Berkshire holding. You're the outlawry this week. I'm sorry. I can go back and look for a Berkshire idea. I didn't know we were going to have a thief.

All right, James Early, Jason Mozer, Tim Hanson. Guys, thanks for being here. Thanks, Chris. To read more from Tim, you can go to Fool Funds, That's going to do it for this edition of Motley Full Money. Our engineer is Steve Broido, our producer's Matt Greer. I'm Chris Hill. Thanks for listening.

We'll see you next week.