Motley Fool Money - Motley Fool Money: 11.12.2010

Episode Date: November 12, 2010

Asian market tumble.  Gold hits a new high.  Cisco and Disney report earnings.  And Walmart makes a big move for the holidays.  On this week's show, we'll discuss those stories, share some stocks on our radar, and talk with television critic Tim Goodman. 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. Daredevil Born Again official podcast Tuesdays and stream Season 2 of Marvel Television's Daredevil Born Again on Disney Plus. Everybody needs money. That's why they call it money. From Fool Global Headquarters, this is Motley Fool Money.

Welcome to Motley Fool Money. Thanks for being here. I'm your host, Chris Hill, and I'm joined by Motley Fool Senior analyst, Seth Jason, James Early, and Ron Gross. Guys, good to see you. Good to see you, Chris. We've got the latest on Disney, Walmart, Cisco, and more. We've got Tim Goodman from the Hollywood Reporter to talk about the business of

television. Plus, we'll give you an inside look at the stocks on our radar. But this week, we begin overseas. On Friday, the Shanghai Composite Index dropped 5.2 percent, a rough end to the week around gross, and U.S. stocks opened lower on Friday. How much of a ripple effect does that kind of thing have? Well, it does seem to be having somewhat of a ripple effect. What we're dealing with here, Chris, is that the Chinese inflation rate came in higher than expected. So that led investors to fear that the Chinese government would tighten monetary policy, come in and raise interest rates. Which they've been doing along the way already. Exactly.

So people rushed into lock-in profits, driving stocks down. That spilled over to the Asian markets, and it appears to spilled over to the U.S. markets as well, because if the Chinese economy slows, that has implications around the world, I kind of think that's somewhat of a natural consolidation. This happens. You know, we have the market's been on a tear in China for the last three months. It's still up 15% over the last three months. So it's not that much of a concern.

Shouldn't get too worried about. I think that's right. James? It just goes to show for all the China fanboys out there. I mean, the growth is not as robust as people might think. I mean, or at least the valuations, they're very easy to knock down, easy come, easy go, basically. And more worrisome, I think, for investors out there than simply where the market is going from one day or one week to the next is the idea that is still continually clung to, I think, among certain.

people that China is the economic engine that somehow is going to save the world and that Chinese consumers are going to be the main engine moving forward. And I don't know that I buy that story. Sticking overseas, the G20 meeting wrapped up in Seoul. James Early, it seems like one of the themes of this G20 meeting was everybody's mad about money and like not in a good way. People are angry. What was the most interesting part of the week for you? It's very interesting. I've seen party at a Mormon bar, I think. I'm somebody who doesn't drink, so I can say that. I mean, everybody comes together to do some kind of deal, but nobody wants to budge an inch.

So it's like nothing happens. It's like crickets chirping. I think to me, the Korean import-export situation is most interesting. I mean, there's this deal that would have entailed the U.S. lowering tariffs on Korean cars and electronics in exchange for Korea, lowering tariffs on U.S. beef and maybe some semiconductors. But, you know, they don't want to do that. so it's just in limbo.

I would say it was nice of these leaders to pause for a moment, to hold an emergency meeting to deal with the sovereign debt crisis that will destroy Europe one day. You're talking about Ireland? You're talking bad things about Ireland? Those are my people over there. Unfortunately, it's not just Ireland, but sovereign risk has risen sharply over the recent past,

and there are some real concerns once again about the debt situation over there. Seth? Well, let's denerdify if we can what Ron just said there. The news this week was that all of a sudden everybody realized, big shocker, that Irish debt might not be great. The banks in Ireland were in terrible shape. There was a bubble, a real estate bubble in Ireland that dwarfed most real estate bubbles in terms of national scale.

And so what has happened again is that the rest of the European countries have had to say, oh, don't worry, we've got Ireland's back. that causes problems for all of the rest of them because while Irish debt may be trading at levels that would have high yields because of the perceived risk, if Germany and some of the others in the European Union say, hey, don't worry, we'll guarantee it. Well, then they essentially kind of shoot themselves in the foot because why would you buy safe German debt with a low yield when you can buy crummy Greek or Irish debt, which has a German guarantee behind it anyway? So this is a real problem. Whenever this keeps coming back at rears its head, the euro kind of takes a beating.

It's just so ironic because just a few years ago, Ireland was like the big hero of Europe, this fast-growing economy and everybody wanted to be a part. Yeah, exactly. Allied Irish banks was such a popular investment, and now it's just the opposite. I was like the red-headed stepchild. Yeah, Pimco came out today

and said the real fundamental problem that can't be helped by a bailout is their real lack of competitiveness. Ireland also leads Europe and per capita drinking, I will say. I don't think it's related, but just FYI. All right, let's bring it back to American shores. Guys, let's get into some of the earnings news this week. And we'll start with Cisco systems.

Solid earnings for the quarter, but a disappointing forecast for the next quarter, and the stock fell 15% in a single day. James Shirley, was that an overreaction? You know, Chris, I don't know. I think it's as much a statement about the general economy as about Cisco. itself. I mean, yeah, I think analysts wanted 13% revenue growth and Cisco said it's going to be more like 3 to 5%. And it's still not bad. Apparently the slow set top box sales, you know, for TV boxes, we're partly to blame. I don't know. I think it was probably an overreaction, but in a sense,

reactions these days create economy. It's not just psychology, so we can't ignore it. Well, and on the other hand, Intel came out this week and announced that they raised their dividend 15%. You're our dividend guy you had to be doing handsprings over that. I like it. Intel said they had their best year ever, but in fairness, that was kind of a rearward-looking statement, whereas Cisco is looking forward. I think Cisco is still more gloomy than Intel. I think the issue is companies have a lot of cash, so certainly the potential to grow is there. Will they spend it? We don't know. Ron, we were talking before the show. You used the word bellwether in reference to Cisco,

and that certainly makes sense. So as an investor looking at the tech sector, should I be more discouraged by Cisco's news, or should I be more encouraged by Intel science? I think James hit it right when he spoke about forward-looking. Some of these stocks have really increased in value quite significantly over the last 12 months, and some of them have some really nice growth priced in to those valuations. So when we get a comment that leads us to believe that the growth might have been exaggerated, then the stocks just naturally pull back, and that tends to happen. Disney reported their latest earnings for the quarter, but Ron Gross, the earnings seem to be taking a backseat for some in the media to the news. The earnings leaked out early.

Right. What happened? So it seems to be very innocent. An employee literally made a mistake and released earnings before the market closed, which is something that is not typical. And the stock just happened to drop suddenly. So the stock drops suddenly because... It wasn't even very much. It was 4% or something, wasn't it?

Correct. So the headline at first blush was that they missed earnings expectations. Actually, the quarter was kind of messy, and if you take the time to strip out all the one-time occurrences, the company actually beat expectations, and the stock has now rebounded and is trading significantly higher as a result. Companies kind of firing on all cylinders at the moment. ABC is strong. Toy Story was huge for them.

Marvel is developing, the recently acquired Marvel is developing. Two movies for next summer. About superheroes? What else would Marvel do? Sweet. That's what Marvel does. World needs more dudes than leotards. Company generated $4.5 billion in free cash flow last year.

So things are on track. Now, you said they're firing on all cylinders. Not all. Maybe I exaggerated. The theme parks, really? The theme parks are at least for the last quarter, even last year, not great. However, they have said for the current quarter that bookings are up 5%. Just to put you on the spot around.

Do you have a favorite Marvel superhero? So I'm a DC guy, as you may not know. I am a Superman collector. Really? But Spider-Man's the movie franchise at least is pretty good. You're a Superman collector? I am. I never would have guessed that.

You don't have a lot of Superman stuff. I do, actually. Do you really? Come stop by. How come you never invite me to come by your desk? You're always welcome. Coming up, for the past year, Facebook has been working on something they call Project Titan. They are reportedly unveiling it on Monday, but we'll talk about it next.

Stick around. This is Motley Fuller. Money. Welcome back to Motley Fool Money. Chris Hill here in the studio with Seth Jason, James Early, and Ron Gross, as we dig into some more earnings news from the week. J.C. Penny reported strong sales and the company's third straight quarter of same store sales growth. Seth Jason, you're our retail guru. How are they doing it?

Well, they're doing it the way a lot of retailers are doing it, cutting prices. and that is worrisome to analysts, which is why the stock responded a little bit negatively after the news. But I took a look at J.C. Penny's margins, and over the years they've actually crept up if you kind of get rid of the terrible financial panic year. They're a lot higher than they were a few years ago. So something's going right at JCPenney,

although the trailing 12 months I noticed their free cash flow, it kind of fallen apart. But maybe they're revamping the stores as well. But I wouldn't count on it. It seems like the kind of thing, who actually shops there? It's an intriguing story. It's very strange, but they seem to be doing a good job of somehow bringing people in, whether or not that makes it a decent investment for the longer term.

It must shop when we're not looking, because around here you could operate a driving school and a JC-Baney parking lot. I mean, there's nobody there. Activision smashed the one-day sales record for video games this week. Call of Duty Black Ops was released and sold more than 5.6 million copies in a single day. Ron Gross, Activision is a company you follow closely. How happy are you this week? Good news. Good news.

So we own Activision in the service that I'm part of here, a million dollar portfolio. And that name again is? Million dollar portfolio. It's a 3% position for us. We're very happy. So that's $360 million in one day. It's actually the biggest entertainment launch in history. Very exciting. That's way bigger than movies, really.

member of everybody. Way bigger than movies. On track to break last year's record, five-day record, where they took in $550 million. Breaking their own record. Breaking their own record. I read an analyst report today that thinks they'll do a billion dollars over the holidays in just this one game. So this rivals, you know, we're talking Titanic, Michael Jackson's thriller. This beats them all. It's pretty exciting. Is this avatar big? Have you played this game yourself? I have not played it. I've seen

other people play it, but I haven't played it myself. If you like shooting people in a desert, I think this is the game for you. And I think, Ron, one of the people you need to thank is our own Steve Broido, because Steve, you bought one this week, didn't you? Yeah, last night at Best Buy. Pets it up. I'm also a shareholder, by the way. Thanks, Ron.

How many people have you killed? You know, I played a little bit last night. It's kind of late, and I don't know. This may be my last shooter game. You kind of get it. It's good, and the graphics are pretty sweet, but it's just a lot of murder. You getting too old for this? I might be.

I don't know. In non-Shutem-Up game news, Viacom announced that they're selling its Harmonix Division, actually, which is the rock band franchise. As you probably know, Activision is the guitar hero franchise. So it'll be interesting to see if Activision has an interest in making a bid for rock band. Time will tell. Yeah, but so far, I think it's pretty clear that shooting people is a whole lot more lucrative. Notting than playing a guitar.

Yes. This week, Walmart announced it will offer free shipping to online shoppers on nearly 60,000 and items. Seth, how scared should Amazon and Target be? That'll be interesting to find out the answer. I don't think they should be very scared because really who goes to Walmart to shop online? I mean, Amazon is far and away the leader. People might be now, though.

Yeah. And one of the advantages Amazon has is that if you know if you go to Amazon, there are going to be a lot, sometimes far too many, of reviews on the items you're interested in buying. And you're going to get less of that if you shop at Home Depot. or already or Walmart. So I really don't know, but if they can get word out in the press, they could actually pull some sales away.

Of course, the other thing is Amazon can just turn around and duplicate this and mitigate the effect entirely. According to numerous reports, Facebook is having a public event on Monday at which the company will unveil a new email. Some are calling this a Gmail killer. So, Seth, do you think Google is quaking in its boots? I don't think anyone is quaking in its boots.

Because I'm doing the McCauley Calkin hands on the side of my face shock thing. Oh my God, an internet company is going to offer free email. Who cares? This is 20-year-old technology. Facebook has an advantage if they want to sign a lot of people up and that they already have 500,000 or 500 million people signed up. The question is for Facebook investors, which is none of us because it's still closely held. Does this matter for the bottom line?

and does it pull people away from Gmail or other systems that somehow provide any kind of revenue for Google or Yahoo or the others? I'm not sure how email fits into their operations in terms of profit going down the bottom line. Google just does everything in order to get information. So you could assume that it helps them get smarter, but I don't know that they make any money or all. It just drives more people to Facebook.

And it's already the number one site. Exactly. And there's already some skepticism- related to Facebook with regards to privacy issues, it's going to be interesting to see if users really are interested in using Facebook as another way to communicate with others when they're already somewhat skeptical. We've all got our hot mail address, our Gmail address, and our Yahoo mail address. Do we all need a Facebook.com email address, too?

Well, and you were talking about privacy, Ron. The one significant snafu that Google has had related to privacy was around Gmail. So, I mean, Facebook's already had several snafus with respect to privacy. Is this another potential landmine for them? You would think it could be. Hopefully, they've learned from previous mistakes, and they can get it right. But I tend to think, perhaps not. I doubt they have, and the stakes are much bigger because the stuff that people share on Facebook

is generally not all that important. It might be horribly embarrassing to some people, but it's not that important. But if people start emailing documents, and other things that are important to their work, if they're silly enough to do it in Facebook. At that point, privacy issues or screw-ups become huge. Gold hit yet another all-time high this week. Silver hit a 30-year high. James Early, tell me why investors should keep ignoring these precious metals that just seem to keep going up.

Well, there's actually a subplot here, Chris, which is we're in Buffett and MC Hammer at odds again. Again? Ben. MC Amher, as we know, is a partner in cash for gold. And Warren Buffett is now saying that he thinks gold is overpriced. You know, there's obviously no real official way to value gold in the first place. And he actually thinks people should get into dividend stocks instead, which, hey, I mean, that touches my heart as a dividend investor. The case for gold is not outrageous, though.

We've got this massive bond purchasing that Ben Bernanke's been doing, hoping it's going to, I guess, trickle down to the rest of the economy. But so far, Ben Bernanke is the only one doing any trickling. So it's not helping yet, but I don't know how much higher gold is going to go. I would be a little scared. I've given up. I'm on the side of the gold bugs now for no good reason other than I'm just exhausted with rationality. I say buy all the gold you can get. Spend all the mortgage your house again.

The rates are low. I'm sticking on my goals. Can't value it. I have no use for it. James? You know, I was just researching this story and I was reading a Ben Stein article who he interviewed Warren Buffett and sort of broke some of this gold news. I detected a little bit of gold, a little bit of bromance, excuse me.

He starts his article saying, the first thing I noticed in my recent visit, Warren Buffett, who recently turned 80, is how incredible he looks. He would look terrific for 50. For 80, he looks like Charles Atlas on a waterbed. I made up the last part. I will say one, even though I am not a fan of gold purchasing, I will say that on an inflation-justed basis,

it is nowhere near its all-time high. So folks that say, you know, it's time for a pullback because of how high it is. Not sure that's a great argument, but since it's impossible to value, I stay away. And finally, Sarah Lee became a bimbo this week, and all it took was about a billion dollars. Sarah Lee sold its North American bread baking unit to Mexican baking giant Grupo Bimbo for just under $1 billion.

Guys, Sarah Lee has a lot of brands under the Sarah Lee umbrella. I'm going to spot you up with four brands. You tell me which one is not a Sarah Lee brand. Here we go. Brill cream, hair products for men. Tidy bowl. toilet cleaner. Kiwi shoe polish

or Chemotex, a Hungarian insect spray. Ron Gross, which one of those is not a Serrely brand? What was the third one? Kiwi shoe polish. Yeah, I'm going with Kiwi. James? I'm going to say trick question. They're all surly brands. Seth? Wow. James is that... James's going

off the board. That's pretty good. I was going to also go with the third, the Shinaola. All right. Steve Broido? I'm going none of them are brands, or serly brands. Oh, wow. The winner is James Early. All four. Sarah Lee Brands.

And yes, let's just repeat that last one one more time. Chemotex, a Hungarian insect spray. You know, you can sell any kind of insect spray you want in Hungary. The rules are very lax. You can name anything you want, too. Drop us an email, Radio at Fool.com. Tell us what you think about Sarah Lee. Tell us what you think about anything.

Just, we're lonely, frankly. So just drop us an email, for the love of God. The guys will be back later in the show to talk about the stocks that are on their radar. But up next, Tim Goodman, the chief TV critic from The Hollywood Reporter, will weigh in on the business of television and the future of online video. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money.

I'm Chris Hill. Our guest this week is an award-winning TV critic and columnist. After spending much of his career writing for the San Francisco Chronicle, he recently joined the Hollywood Reporter as chief TV critic. Tim Goodman. Welcome to Motley Full Money. Thanks, Chris. How are you? I'm well, thanks.

So there's a lot going on in the TV. business. Let's start with Conan O'Brien. His new show debuted this week on TBS. He's going head-to-head with John Stewart on the Daily Show, but he's also competing with the likes of Jay Leno and David Letterman. First, what's your take on his new show? Well, I think it's pretty much everything in what fans of his thought it would be. He's much looser. He kind of has that wacky, weird sense of humor, and I think that's really coming through. He had a great opening night. Conan O'Brien, I think, over 4.1 million viewers. He beat Leno and Letterman. Second night, his audience dropped to 2.8 million. So my question is, in terms of audience size, what does success need to look like

for TBS and Conan O'Brien? Well, I think if he keeps those numbers up, he'll do the second night numbers, he'll do just fine. I think that his strength is in the key demographic 18 to 49. He is just, you know, he's indexing right now at about 30 years old for the core audience, which is far younger than his competitors. And so he's doing a much better number in that key demo. So that's what they sell the advertisers. So money matters, as you well know. So I think he's going to be just fine. And I think that TVS is pretty pleased by the performance so far. You're listening to Motley Full Money. We're talking with Tim Goodman, the chief TV critic from the Hollywood reporter.

Tim, as investors at the Motley Fool, were constantly focused on the future of various industries. So in thinking about the future of television, is it more appropriate to label it the future of video? Because with companies like Hulu and YouTube out there, is there going to be a mass convergence? You know, I know I may be in the minority here, but I don't believe it. I honestly don't. I think that, and I was just discussing this just the other day, the difference is that, well, YouTube is user generated, but they've never been able to, nothing on the Internet has been able to generate

a hit of any kind of quality hit that you could sort of say, all right, this will be self-sustaining and ad supported and it will make money. You have very popular videos, most of them running in a short period of time. You've had professionals like Eddwick and veterans and television try to do their own shows for the Internet, haven't worked. And Hulu is just a conduit for somebody else's content. My belief is that, you know, will we be watching content on these other screens? Sure we will. I mean, that's a given, but the networks are never going to give up the content. They're the ones

who are creating the content, and they make the best content, whether we think so or not. So long as they control that, television is never going to die. I think screens are, the television is still going to remain dominant. You might watch it on different screens, but they're never going to, in Hollywood, they're never going to let go of the content that keeps them around. And no other places that sprouted up. People say, oh, I can make a better show, and I'll do it. And then they get panned, you know, online.

And then they realize the audience is a very tough judge and leave it to the professionals. So when you think about the various pieces of the television industry, you've got cable providers, you've got broadcast networks, the online video piece, Who do you think stands to lose the most in the future? Which industry do you not want to be in? Well, you know, that's a good question.

I think when you look at who's going to be – I mean, it's almost in some ways the whole print thing, right? It's print dead and will newspapers be around. I really think television is still going to be around. I still think it's by far the most popular medium. And, you know, if you look at the numbers about how much people are spending online, time is failing. It just pales in comparison to television. So, you know, we may get to that point where this convergence and everything's blurred and people are spending equal amount of times watching on their phone or their TV or their computer. But right now, I think television's dominant.

And as long as they control the content, they don't have to worry about. You're listening to Motley Fool Money. We're talking with Tim Goodman, TV critic from the Hollywood reporter. What's the best show that's on TV right now that not enough people are watching? Well, although it's not currently on right now, I'd say the two best shows are Mad Men and Breaking Bad. To me, those are the two best shows that are on television right now. If you're talking about one that's probably airing right now, I would say Sons of Anarchy and probably Boardwalk Empire. What's the most overrated show on TV right now?

Well, I would certainly say it's American Idol, which I actually think is going to head to head into a demise territory at some point and probably quicker than anybody thinks. But yeah, that's just, I think that's run its course and it's still the most popular show on television, but I believe a turn is coming. What has surprised you the most, you've been writing about television for the last couple of decades, what surprised you the most about the television industry? Well, honestly, I think, seriously, and I'm not kidding about this, I think it's how much better it's gotten. You know, one of the things that I always point out to people, you say, okay, if 80% of television is terrible, which I've been doing this for like 13 years or so, yeah, it is, that is true. But the 20% that is really great has expanded so much over that time that you couldn't, you couldn't, a normal person couldn't even watch that great 20%.

There's so much of it. They couldn't, you'd run out of time. So it's all about ticking. It's all about being savvy and your choices. And, you know, it's okay also to have a few things on the menu that are, you know, you're just coming home, you're kind of brain dead, and you want to watch. There's a lot of that on there. And there's a lot of really educational stuff that's not just on PBS. There's great stuff.

But I'm just impressed by the amount of quality there is as we approach this sort of hypothetical 500-channel universe. The content is amazing. Worst show ever? Wow. You know what? I always say, Chris, that if you're going to be a critic, you have to be like a cornerback in football. have a short-term memory. And I've seen such bad stuff through my ears that I love the fact that I can't actually recall it. I don't really stay up late worrying about it. But I think every season I come

up with something, whether it's bleep my dad says on CBS or, you know, God knows what they're putting on at CW. You're going after Shatner? I mean, he's, at the Motley Fool, Shatner is somewhat worship for all that he's done for price line. Yeah, but we haven't done much for that TV show, I'll thing of that. You're listening to Motley Full Money. We're talking with Tim Goodman from the Hollywood reporter. Before we move on to buy-seller hold, again, going back to the future of television, there's a very traditional business model when it comes to cable television. And every couple of years, it seems like some noise is made in Washington, D.C., Congress starts rattling some sabres about an a-a-carat pricing menu. Are we ever going to see a major change in how cable

television is delivered. Well, I know the, I know the viewers would love that. I mean, that's, that's one of their biggest complaints about trying to buy, you know, your package programming and buying it together. If that ever came apart, you know, it came about, I think that, obviously there can get big fight on the cable side of it. That would definitely damage cable. They're getting all their money for carriage fees. And I just, yeah, that would hurt, but it would be very good for the consumer, because I think people would like to sort of pick and choose stuff. because Chris, one of the, I think, funniest and possibly saddest things is when I talk to people, they don't know what they're paying for.

They don't know what channels they have because they're not really watching them. So I will write a review and they'll say, what channel's that on? And I'll tell them, you know, they've never been to AMC or something. I'm like, yes, you actually have it or you do have BBC America. They just don't know what they're paying for, which I think it's sad. So you're saying I'm stuck with the Lifetime Network? Yes. You're listening to Motley Full Money.

We're talking with Tim Goodman, Chief TV critic from The Hollywood Reporter. All right, Tim, before we let you get away, we need to wrap up with a round of buy-seller hold. Let's start with someone who just came back from suspension, buy-seller hold, the future of Keith Oberman. Bye. Why is that? Well, I think, you know, that his fan base is rabid. I think that he appeals to people, and they're not hearing that voice, obviously, somewhere else. You know, it's very obvious where he stands, just like the Fox people stand.

But I think he is a magnet for people who are like-minded and thinking that way, and there's just not that many people out there for him. And he's really smart. Don't underestimate that. He's gotten a lot of attention for his recent rally in D.C., but now he's going head-to-head with Conan O'Brien. Buy-Suller-Hold, John Stewart. Oh, always buy on John Stewart.

He's the funniest guy on the planet. Really? He's the one, you're putting him number one on the TV list? I think he's the funniest guy that I've ever met, consistently funny and smart. although I do love Chris Rock, too, but still, there you go. Someone who's been off TV for a while, Biceller Hold, a return to TV for Jerry Seinfeld? I think so.

We're never seeing him on TV again? Well, he could be, but he's always going to be Jerry, you know, and I think that, I think he damaged some stuff by isolating himself with Conan, I mean, sorry, with Leno. And what could he put him in? He's always going to be Jerry Seinfeld. He can't really act that well. his stand-up stuff is great, but he'd be a very limited person for what he could do.

And I don't think he'd ever repeat Seinfeld. And in anticipation of the new network, buy-seller hold, Oprah Winfrey. Wow, that's actually very good. I'm going to say holds because I don't know yet on her. She's going to, it just goes back to the people who don't know what they're getting. When they find Own on their channel and they turn out and droves, then I'll believe it, And she is quite the magnet. She is a deity in her own right and very powerful.

But you know what? It's very hard to make your own network work, even if you're on it and you're a diva. So I see a hold for a little bit. He is the chief TV critic for the Hollywood reporter Tim Goodman. Thanks so much for being here. You bet. Coming up, fast cars and stocks on our radar. This is Motley Fool Money.

Welcome back to Motley Fool Money. I'm Chris Hill. Joining me to talk about one of the week's big movers is Motley Fool Man managing editor Brian Richards. Brian, good to see you. Chris, thanks for having me. All right, so one of the stocks that was up big this week, Tesla Motors, up almost 20%. Tesla Motors just reported a $35 million loss, didn't they? Yeah, so Tesla Motors is an automaker, which has generally not been a good business to be in America in the last... Generally. Two decades or so. It's an automaker reporting a $35 million

loss in its recent quarter, but Tesla is a little bit different than your Fords and your GMs. is an electric vehicle manufacturer. Right now they have the Roadster, which is a $100,000 sports car, popular among some of the Hollywood crew. And they're really ramping up for this Model S, which is a sedan car, more of a mass consumption kind of car. It can be offered around the $50, $55,000. Oh, so much cheaper. Much cheaper. So what is driving the stock if they're reporting losses and selling really expensive cars? Well, as sort of a green technology. based company, it's electronic vehicles. Their financials matter less than for an established company like Cisco. I know we talked about earlier in the show. Tesla's results this week,

the 20% gain was really driven by its ability to ramp up mass production, which it showed some positive signs in the recent quarter. It has a new partnership with Toyota, which should help. So those are the sorts of good news that investors were looking for and that have helped the stock rise. All right, Brian Richards, thanks for joining us. To read more on the stock market's other big movers and for investing commentary analysis each day throughout the week, check out fool.com. As always, people on the program may have interest in the stocks they talk about. Don't buy ourselves stocks based solely on what you hear. I'm Chris Hill and back in the studio with me, our trio of senior analysts, Seth Jason, James Early, and Ron Gross. Guys, it's that time again,

time to talk about the stocks that are on our radar and we're going to, we've got a little extra time here. So we're going to bring our man Steve Brodo into the picture here with a question for you. So, you know, I hope you're more prepared than usual, Ron. We'll start with you. Ron goes. So coming off the heels of our Sarah Lee conversation, I think I'm going to talk about Procter & Gamble, ticker symbol PG. I think we all know about their unbelievable brands. Gillette, Crest, Duriselle, Tide, Bounty, I mean, on and on and on. Do they have any Hungarian insects sprays? They do. They do. No, they don't. In fact, 23 of their brands, each bring in $1 billion of revenue. It's really...

Oh, my God. It's amazing. Company has a nice dividend yield of 3%. James, I'm sure you're well aware. They generate a ton of free cash flow. They repurchase $6 billion worth of the stock in the last 12 months alone. Not the cheapest stock in the world right now. On a pullback, I get really interested. Right here, I'm sort of interested, but it's something I'm going to be watching closely. How's the international growth for them? That's the direction for these companies, I think. How are they doing? I think it looks pretty good. It's been the main drive.

For them, for Kimberly Clark, for a lot of, Unilever, a lot of these guys are really hitting out of the park in the third world. So it turns out these brands or brands they acquire out there do resonate in places that we wouldn't imagine. There's status symbols, actually. Yes, they are. Steve, Runa, what's your question for Ron? Well, first off, Ron, I'm also PG shareholders. Nice.

Hooray. My question for you is, we're in sync today, Steve. Are there really, is there a lot of room for developments in these kind of basic home material products like laundry detergent? I mean, how does a company like P&G really grow? when you're basically releasing products that have been around for 100, 200 years. Just kind of just as we said, you grow internationally, you grow overseas, and then you can continue to bring new brands into the fold, whether it's through acquisition or development.

And that's why it's really not the cheapest stock, because it's not a high-growth tech stock, for example, but it's a really solid blue-chip, 3% dividend yielder. But I got a question for you, Steve. You look like an old spice kind of guy, which is another brand of Proctor and Gamble. in the day would you consider yourself a heavy user of old spice or kind of just a light user I would say a no user I'm not an old spice guy all right but thank you for

playing all right no problem was originally a women's cent actually that they remarketed all right James early your stock this work Chris I like academics I like academic research and three guys named Lecana shock Schliefer and Vishni maybe 10 15 years ago found out that stocks with slow sales growth and low PEs actually beat the regular market actually excuse me beat beat the reverse beat growth stocks basically about 11 percentage points annually which is huge. So in the spirit of LSV, I'll call them.

I've got a company from this screen. It's not a formal recommendation, but it does have low P.E. And low sales growth. The name is Safe Bulkers. SB is the ticker. It sounds like the kind of business. Seth and I would start if we had a business together. I don't know why.

I don't know what that means. Well, just wait around. It's a bulk shipper headquartered in Greece, which a lot of them are, paying 7.2% in dividend and a little over $500 million in market cap. All these shippers that basically plays on the global economy, but they have a big headwind, which is there are a lot of Chinese vessels coming online now. So that's kind of the bad news. That's why arguably LSV as a group would say the stock is down.

I don't know if it's a great buy, but it's definitely a potentially undervalued play at this point. Steve Brunow? My question is how would anyone know to even buy this company? I mean, how would I be aware, besides obviously you've just told us, but barring that, how would I ever know about safe, what is it, safe buyer? Safe bulkers. Steve. Bulkers.

How would I even know to buy this thing? I actually had to screen for it myself. You come to Fool.com. I was going to say, and that's what makes it cheap. Full.com, where there are hundreds of articles

every week being published. So, Steve, I guess, in Ron's spirit, I'll lob a question back to you on a scale of 1 through 2 and how convincing is my pitch for safe bulkers? I would say it's a 7 right now.

Wow. Wow. That's pretty good. He's operating on a number scale. or three. Seth, Jason. James is, you know, whizzing all over my growth stocks, but I'm going to go with it anyway.

Fossil. They make the watches. You know what you know about them. You've heard of them. You probably thought they were a joke, maybe over in the 80s, turned in another incredible quarter. I own this stock personally. This has been a radar stock for you several times.

Yeah, and it has to be a fossil watch that your wife gave you, right? Yeah, we own it a hidden gems. I have a Superman fossil watch. I actually have several. Of course you do. Quit interrupting me with color here. Come on. Net sales up 37% earnings up 93% last quarter.

I checked. They're not stuffing the channel. The accounts receivable growth scales about the same as this. They're just selling a ton of stuff. They don't sell just watches, although the watches have done very, very well, and they get high margins on those. So that's part of what powered that. They also sell leather handbags. I'm looking at the website right here, $170.

bucks and they're selling a lot of this stuff. I have to step back and re-figure out what fossil is worth, but I've kept it on by for a long time now because they just keep doing this. Who else is out there growing at 40% a quarter right now? If you can find them, email

them to us because we'd like to know about them. Yeah, definitely drop us an email radio at full.com. What's the ticker? Tigger is F-O-S-L. And Steve? Steve, what's your question? My only exposure to fossil is in the kind of the outlet mall thing. you know, where they're discount mall, that doesn't seem like a very encouraging sign.

That's my only exposure to fossil is, you know, you're at the beach and you drive by one of those outlets. And anyway, that doesn't seem encouraging to me. Well, retailers, fossil sells a lot to other retailers and to get rid of stuff that they have extra, you know, they often farm it out to places like this. That's a problem for these companies. They have to manage how much they sell and they have to manage expectations of the retailers. But fossil in general has done a very good job of that on their own. Do I get to ask Steve a question?

Sure. Is it my birthday? What's going on? It is. Yeah. What's your favorite leather product, Steve? Wow, that's awesome. I guess my wallet, of course.

This is national radio. Nice. Thank you for playing. All right. Seth, Jason, James Early. Ron Gross. Guys, thanks for being here. Thanks for Chris.

Thanks to our special guest this week. Tim Goodman, Chief TV critic for the Hollywood Reporter, and Brian Richards, managing editor of Fool.com. For the latest analysis and investing commentary each day throughout the week, go to fool.com. Our engineer and leather lover is Steve Broido. Our producer is Matt Greer. I'm Chris Hill. Thanks for listening. We'll see you next week.