Motley Fool Money - Stocks for the Next 10 Years

Episode Date: February 22, 2019

Kraft Heinz plummets on weak earnings and an SEC subpoena. Stamps.com loses an Uncle Sam-sized partner. Wayfair delivers. And Zillow renovates. Analysts Andy Cross, Ron Gross, and Jason Moser discuss those stories and dig into the latest from Boston Beer, Domino’s Pizza, Texas Roadhouse, and Walmart. Plus, Motley Fool CFP and retirement expert Robert Brokamp talks tax tips and retirement planning. Thanks to LinkedIn for supporting The Motley Fool. Go to linkedin.com/fool and get $50 off your first job post. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Hey, hey. We've got the latest headlines from Wall Street. Our guest, Robert Brokamp, is going to help you rule your retirement. And as always, we'll give you an inside look at the stocks on our radar. But we begin with a big brand getting smaller. Kraft Heinz announced a $15 billion charge, which would be bad enough on its own. But the company also announced it has been subpoenaed by the SEC for its accounting practices and shares of Kraft Heinz falling more than 25 percent on Friday, Andy. Tough day for Kraft shareholders, of which I am one. I have a few, just a couple of shares, but tough one. On top of that, Chris, they also cut the dividend by a third from 62.5 cents

to 40 cents, so a triple whammy at a large consumer products, goods company that has just really been suffering. When they look at the next quarter for this year, they're expecting their operating profits to fall by double digits. High teens percentage levels. So overall, the story of craft has not been good really since the merger that they announced between Kraft and Heinz in 2015. They had a couple years of better times, and now it's just been really a struggle. As the CBG businesses are just really suffering with pricing pressure and with low sales growth. I wonder if you're 3G and or Buffett, do you kind of turn into an activist here and say, we've got to make some very big moves because this is not working in this current environment?

I mean, Berkshire owns 26% of the stock and 3G owns 22% of the stock. Well, and if you're a Berkshire shareholder, I mean, the headlines are, wow, this is a $4 billion drop. That's less than 1%. So, Berkshire Hathaway is going to be fine. I feel like we've been feeling this way for a while, guys. I'm going to get out of it. I feel like we live in this non-gap world now where, I mean, companies can, they can release these impairments and typically get by with it, okay, saying, yeah, we have this gap. number, but adjusted our earnings were such and such. And so, I mean, adjusted earnings a little bit down from a year ago. But I think that to your point, Andy, I mean, it was a triple whammy essentially of not only the impairment. But, I mean, there's an investigation now underway, and they're cutting the dividend. And, I mean, really, let's go for the quadruper whammy here,

because I don't know that really that market. I mean, they're brands. I don't know are as valuable perhaps as they were when we were growing up. I mean, I don't. When is the What was the last time you got Kraft, Macaroni, and cheese or went and bought Oscar Meyer hot dogs? I mean, it is just a different world with a lot more choice out there. Well, it is going to be interesting to see how this plays out, because one of the possibilities here, Andy, is they go the route that Procter and Gamble went 8, 10 years ago, where they said, basically looked at their brand portfolio and said, we got too many brands. Let's start selling some of them off. And I think if you're Unilever or, frankly, any other sort of private equity group, you've got to be looking at the craft times. portfolio and thinking, hey, if we offered a decent price, we could get some of these.

Well, a couple years ago, they tried to arrange the merger with Unilever. Didn't work out. They've already talked about selling some of the assets, some of the brands. They're going to have to do that to try to cut costs and pay down some debt. But really, just the financial engineering to try to aggressively cut costs. And after a merger like this, added a ton of goodwill and intangibles to the balance sheet. I think in the consumer goods market, it's just really difficult to do. because, to Jason's point, the customers are so fickle. Shares of Wayfair up more than 30% on Friday. Fourth quarter results for the online furniture retailer were better than expected.

You tell me, Jason, was the quarter that good or were the expectations that low? No, I think it was a pretty good quarter. The first number I look to in their release every quarter is the percentage of orders that were placed by repeat customers. That really is the crux of the thesis, believe it or not. this past quarter repeat customers placed 66.4% of total orders versus 62.4% a year ago. And the reason why that's important is because it basically represents customers that they don't have to acquire in the future. And it costs a lot of money for a business like this to acquire those customers. And so when you combine that metric along with all of these other metrics that tell us that

people are going to Wayfair and they keep buying more stuff. I mean, top line is up, orders per person. It's all headed in the right direction. I think as long as those numbers keep going in that direction, the market's seeing a light at the end of the tunnel that a business like this can reach some sort of level of profitability in the future. Now, I think that's the key here really is that if they don't keep those numbers heading in that direction, if we even see a slight crack in the facade here, there's going to be a big problem. And I think the market will change its mind and maybe not assign that multiple that's giving it today. because it's worth noting. They're still not profitable. It's not like they're looking to become meaningfully profitable anytime soon. But they're pursuing a very big market in home furnishings

and home goods. I mean, they really have built out, I think, a great business around a lot of different brands that people are using. It seems like every day. Are they working on Wayfair Web Services? Because that would also help. That would be a nice little addition, right? A nice hail wind. Sticking with retailers that start with the letter W. Walmart's fourth quarter profits came in higher than expected. And Ron, the online sales sales. numbers continue to climb. Very strong. Up 43%. I like this report. Com sales up 4.2%. 18 quarters of U.S. comparable sales growth. If we look back five or six years ago, we remember U.S. was really

struggling, and we said if they don't turn this around, they're in trouble. So kudos to them for getting that done. The one weak area is international now. Nothing can ever be 100% good at the same time. So international was a bit weak. They're trying to make some moves there. They kind of sold off their retail stores in Brazil. They're merging their UK division with arrival, which may actually have some antitrust issues there, so we're going to have to keep an eye on that. But overall, I love what they're doing. Grocery continues to be a big part of this business, 56% of revenue at this juncture. They expanded their online grocery pickup services to over 2,100 Walmarts. And I like what I see with their average shopper ticket in stores, which grew 3.3%.

Yeah, if you just look at the way. that Walmart is marketing itself these days. They really are pushing the online and the delivery pickup. They had to, right? Out of necessity. Amazon was going to really eat their lunch, speaking of groceries, and they needed to step it up. And they've done so. These things have costs associated with them. So they're not free, and they take a whack out of margins, at least in the near term. Hopefully in the longer term, things catch up from a revenue perspective. But they had to fight the fight, and so far so good. However bad your week was in the market, it probably was not as bad as that of the shareholders

of Stamps.com. The company announced it will no longer be doing business with the U.S. Postal Service and shares of Stamps.com fell more than 55 percent on Friday. Andy, I've seen a lot of things in my investing life. I don't recall ever seeing a $3 billion company become a one and a half billion dollar company overnight. Literally overnight, Chris. As the CEO said, this move will represent some short-term pain over the next few years. You think? Obviously, short-term pain for shareholders today. The U.S. Postal Service was the main carrier of stamps.coms and provided a commission to stamps,

and that revenue is just going to vanish now as they rearrange the deal with the U.S.PS and try to broaden out to use FedEx and UPS here in the U.S. I mean, this is monumentally, this is a game-changing, thesis-changing situation for Stamps.com. And shareholders have to really consider, you know, it's just the kind of business now because the growth rates, certainly the earnings per share this year will be cut in half, even the revenues will be down just slightly. So really, the profitability picture for Stamps is not what it is going forward this year. This seems like such a game changer that I'm wondering if a potential outcome here is this back-futable. fires completely, and in a couple of years, this business is sold off for parts.

I mean, it certainly could. I mean, the bet that they're making is that USPS is going to become less relevant in the shipping environment as time goes on. And that may very well be the case. I mean, we may be looking back at this five years from now and saying, you know, they had to rip the band-aid off at some point, and it worked out for them. Now, I think you better pack a lunch because it's going to take a while. But I tell you, what really was digging through this earlier, what really took me back here

is looking at, you know, we talk a lot about companies, management teams getting sherry repurchase is wrong. And these guys are in a league of their own. 2017 and 2018, they repurchased over $270 million worth of stock. If you look at the chart, the stock chart, over those two years, I mean, they were repurching those shares at extremely high prices. And it was very heavily weighted towards the fourth quarter of 2018. So, listen, I don't begrudge management teams for buying back stock, but I want them to be able to do it opportunistically. And when I look at what they did here, I mean, I can't help but think there's some kind of criminal negligence here because they must have known this type of material

change was coming. It had to be even discussed before they announced it. And to be repurchasing stock like that, knowing something like that was coming down the pike, I mean, you're telling you didn't know, you didn't have anything better to do with that money other than repurchase your overly valued shares. It's hard to stomach. I mean, they bought $89 million back just last quarter. Of the 137, they bought back last year, so it was very heavily weighted towards the end of the year. Yeah, it makes no sense to me. Class action suits will definitely be coming. If you have material information like that, you should be kind of blacked out from buying back stocks, so somebody screwed up here, and somebody's getting in trouble.

And I'm not saying they did have that, but if you just look at it on its surface, it doesn't seem like that big of a leap to assume they did have that information. Certainly, It had to be discussed at some point over the fourth quarter, if not way earlier. And they were still repurchasing those shares. It's confounding. You're saying the idea to completely cut ties with the U.S. Postal Service probably didn't come up in the last six weeks. You know, hey, listen. Anything is possible. To that point, Amazon was mentioned 49 times on the conference call.

USPS was mentioned 90 times. So clearly the Amazon effect is having a big deal on Stamps.com. Coming up, we've got restaurants, real estate, and more. Don't touch that dial. You're listening to Motley Full Money. Welcome back to Motley Full Money. Chris Hill here in studio with Jason Moser, Andy Cross, and Ron Gross. Shares of Texas Roadhouse falling a bit this week, despite good results in the fourth quarter. Ron, same store sales for Texas Roadhouse came in north of 5%. That's good for a restaurant these days. It's a very strong report from a top line perspective. As you said, 5.6 comp sales, 4.8% comp sales from their franchise restaurants.

So really strong. 36th straight quarter of positive comp. So this company is clearly executing. Now, the negatives here are largely due to labor costs, which restaurants and lots of folks are seeing across the board. So operating income actually fell 11 percent despite the strong top line. Now, thanks to lower taxes, they did manage to eke up. a profit increase of about 6%. So bottom line did go up, but we have some costs putting pressure

on here. They still raised the dividend 20%, six straight year of increasing the dividend by double digits. The company has plenty of room for expansion. I have never been to a Bubba's. I don't know if you guys have, but Road Trip. I was going to say, there's a Bubba's 33. Their sports bar concept, maybe 40 miles north of here. We could road trip. We could road trip. Zillow has a new CEO, Spencer Raston. off is stepping down effective immediately. Zillow co-founder, Rich Barton, is moving into the corner office. And Jason, I guess investors like the move because shares of Zillow popped 20% on Friday.

Yeah, I mean, I think it's a combination of the fact that they turned in a decent top-line quarter and they offered some pretty good top-line guidance going forward. But really, I mean, I think to your point, the installation of Rich Barton is a new CEO, I think, is the big deal here. And I mean, this is just turning into a much different business than we've known over the past seven or so years. And I just don't think Spencer Raskoff has the skill set really to be able to execute on what they're trying to do. And essentially, what they're trying to do is to become more a part of the housing transaction. They're moving away from this ad model, and they're trying to become more and more partners with their Premier agents. Now, that's going to take a little bit of work.

And they've been dealing with some headwinds in the premier agent model there for the past several quarters. They do feel like those headwinds will abate in this coming year. And ultimately, they use this term on the call, which I've got to say I kind of liked it. They've talked about this new Uberized consumer, this Uberized consumer who expects magic to happen with the push of a button. Now, I'll push back on that a little bit. I mean, it's one thing to push a button and get a ride somewhere. It's another to push a button in by a house. There's a little bit more involved, right?

But it does sound like they're trying to use all of that data that they have to be. be able to streamline this and make it a better experience for buyers and sellers. It's going to come with a lot of risk. They're extending their balance sheet out considerably. They've got a credit facility now, extend to a billion dollars. The goal, ultimately, the signs of success in five years, they'll be buying 5,000 homes per month. They'll be underwriting or they'll be originating 3,000 mortgages per month. So they really want to become kind of like what Redfin is really, just become that go-to spot to look for and buy a house. I don't know how this all works out for them, but I do have to believe that if we find ourselves in a recession or a very nasty housing market,

this really, really ups the risk scale for them. So, you know, investors ought to be aware of. This is definitely, talk about thesis changing. I mean, this is a different company. Shares of Boston Beer Company up 15% this week. The parent company of Samuel Adams posted good fourth quarter. profits. And Andy, guidance for 2019 was stronger than I think a lot of people were expecting. Well, it was a good quarter, Chris. Shipments were up 6.3 percent. Depletions, which is the wholesaler to the retailers, we're up 11 percent. I mean, those are the kind of numbers we saw from Boston Beer, you know, three, four, five years ago. So that's actually really

positive. The big winners are like the brands like truly hard seltzer, twisted tea, angry orchard. The traditional Sam Adams is not doing quite as well. So some struggles there. And Coke, who owns more than 20% of the stock, had talked about that. Really some fun innovations they're trying to do to kind of tap into new markets. This 26.2 brew, a goja beer made with sea salt to target after the running crew run. Wild leaf hard tea and alcoholic tea that has lower calorie and sugar. So they are trying to innovate to continue to grow. The stock has rebounded nicely because of it. What kind of pricing power do you think Boston Beer Company has? because they touched on that as part of their guidance, not just, hey, we think we're going to ship more beer this year.

We're going to charge more for it. Well, it has been a struggle for them, especially in the beer as the craft beer market tends to soften a little bit. It has had some struggles over the last couple years, and that will continue. So they've had some pricing struggles. I think on the non-beer brands, they actually have a little bit more power than they do on the beer brands these days. Surprising missed this week from Domino's Pizza. Same store sales in the fourth quarter came in lower than expected, and shares of Domino. and I was falling 10% this week. Ron, we were talking before the show. This is not they missed by a penny. This is a solid miss.

Yes, and a rare one, but so everyone just relax, though. Just calm yourself down over there. Everything seems to be pretty good, though. Same store sales up 5.6%. Now, international comps only up 2.4%. So that's a little weak. But we have 100 consecutive quarters of international same store sales growth and 31 consecutive quarters of U.S. same store sales growth. revenue up 21 percent, diluted earnings per share up 25 percent. The company's doing just fine. Now, as we were talking about before the show, there are more places to get your food delivered nowadays than ever before, whether it's Uber Eats or DoorDash or Grubhub. So it's not just, hey, we want food delivered. It's going to always be a pizza. Now you can pretty much get anything you want delivered. And there's some competitive issues there that they'll need to deal with. But they're doing a great job with technology, a great job with mobile and online. and I think they're going to be just fine.

Yeah, but when you're getting food delivered to your house, isn't there really just, doesn't it boil down to it? It's either pizza or it's not pizza. That's how I think it. It's not like, oh, here are all these choices I have. It starts with, do I want pizza? That I think is fair. At my house, it's pizza or burgers, usually.

Yeah, five guys, those kinds of places. And my son is more than happy to pick up the phone or pick up his app and have food just delivered right to him. We're going to bring in our man behind the glass, Steve Broido, in just a second here. But real quick, around the table, what's your go-to topping on pizza? Pepperoni for sure. Oh, one, I've got to go with Italian sausage. Oh, nice.

Pineapple. It's a big fan in the house. Wait, pineapple by itself? Pineapple. Yeah, just pineapple. Yeah, no ham in the family. Just pineapple. Yeah, it's good. I'm stunned that. It's good, man.

I'm blown away by Andy's answer. How about you? Pepperoni. Can't go wrong. Steve Brodo, our man behind the glass. What do you go to when it comes to pizza? Pepperoni. Big time. I think we have a clear one.

I think meatball certainly merits an honorable mention. I mean, you know. Underrated. You don't find your cereal. Perpetually underrated. And bacon goes with everything. It does. You're right.

Ron Gross. Jason Moser, Andy Cross. Guys, we'll see you later in the show. Time to check in with retirement expert Robert Brokamp. Stay right here. You're listening to Motley Full Money. All right. Before we get to Robert Brokamp, let's talk about you for a second.

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So find the right people for your business this year at LinkedIn.com slash fool. And as a bonus, you get $50 off your first job post. That's LinkedIn.com slash fool. Terms and conditions apply. Welcome back to Motley Fool Money. I'm Chris Hill. Robert Brokamp is a certified financial planner than the Motley Fool's resident expert on retirement. And he joins me in studio now.

Thanks for being here. It is always a pleasure, Chris. So it's tax season. It is. A lot of taxpayers got a tax cut over the past year. What advice do you have for those folks? Well, so a couple of weeks ago, the headlines were all about how people were getting smaller refunds this year compared to last year.

So the amount of people getting a refund was down about 20 percent and the size of the refund was down about 8%. So people were kind of freaking out a little bit about that, especially since we're all supposed to pay less in taxes thanks to the tax cut, the new tax law that was passed. at the end of 2017. Now, as of data, as of this morning, it turns out that that was a little preliminary. It turns out that refunds are about on pace. But what is definitely true is there are going to be some surprises. Because the tax law does not affect everyone the same way. Some people are going to lose some valuable deductions. Plus, the tax law changed the withholding

tables that employers use to calculate how much should be withheld. So a lot of people did not have as much withheld as they should have. An Associated Press story told the story of a couple in Oregon who usually get a small refund, and this year found out that they owe $10,000 in taxes. That's kind of a difference. It is a difference. It's not because their taxes went up. It's just that they didn't have enough withheld because the withholdings tables were changed.

So my advice for people is do your taxes now. If you're getting a refund, file those taxes, you'll get the money back sooner. If you find out that you owe taxes, don't file yet. You can still wait until April 15th to file, and it gives you some time to build up that money. But also, that will let you know whether you got your withholdings right. And now is the time of here to get right for 2019 so you don't have a surprise when you do your taxes in April of 2020. Let's move on to retirement. Fidelity just published a report on the state of retirement savings. I saw the report, but I must confess I didn't actually read it.

How are things going? So some good news, some bad news. Let's start with the headline news, which is sort of neutral, I would say. And that is, as of the end of 2018, the average 401k balance was $95,600. Now, that's down 8% from the end of 2017. On one hand, you would expect a decline because in 2018, the S&P 500 was down about 5%. And that's an index of large stocks. Other types of stocks, like small caps and international stocks, were down even more, 10 to 15%.

So you would expect balances to go down. On the other hand, you would also, I mean, with a 401K, people are putting in thousands of dollars a year. have thought the contributions would have offset the declines a little more than they did. But regardless, that balance of $95,000 is up from the average balance at the end of 2008 of $49,000. So overall, people do have more, and that's good news. A couple other things in the good news category, participation rates have gone up. So about 72% of people at a company participate in the 401k. And the savings rate is up, the contribution rate, and that is at 13.1%. And that is a combination of what the employee is putting in as well as the employer.

So that's good. Also, they found out that only at the end of 2018, we had a bit of a decline in the market, declined just about 20%. I think we talked about that on the show. But fortunately, very few people panicked. Only 0.3% got totally out of stocks. So that's good news. Some of the bad news.

Now, I said a 13.1% savings rate is good, and that is good because it is up, but it's probably still not enough for most people. I recommend that most people starting out in their 20s to 30s should be saving 15%. And if you don't start saving until your 40s, you probably have to save even more than that. A couple of other interesting things. So 20, something like 20.3% of people have a loan out against their 401K. And that's the lowest number since 2009. So one in five people are borrowing money from their 401K. And the number one reason is to pay off credit card debt.

So that's pretty surprising to me. A 401k loan can be a smart thing to do, especially if it's just a short-term loan. But to take out money to borrow from your 401k to pay off credit card debt, man, that's pretty scary. And the other scary stat was more than 30% of people, when they leave their job, they cash out their 401K. So they don't leave it in the plan or transfer it to another retirement account. They just cash it out, which A, will cost you in taxes and penalties, but also short changes your retirement. So it's generally not a good thing to do.

If you could wave a magic wand, would you make it mandatory for people when they start a job that they have to start contributing to a 401k? Or I guess probably the better way to put it is you start a job and the employer says, look, we're already going to allocate it. you have to actively opt out of the 401k plan. We want you saving right off the bat. Right. So that's very interesting because I'm on the 401k committee here at the Motley Fool. And we have, what you're referring to is something known as auto enrollment. So as soon as you start at the Motley Fool, we have you automatically contributing to the 401k and you have to opt out of it.

It was a pretty significant debate, actually, in the 401K committee about whether we should do this. And I started out saying like, well, you know what? We're all adults here. People can do what they want with their money. But I ended up being like, you know what, people need to be nudged towards this behavior. And the stats are clear that people who are auto-enrolled in a 401K as well as auto-escalated, which means they contribute a little bit more year after year, have much higher balances. We were talking about headlines before we started taping.

And maybe it's just me, but I'm starting to see more headlines about consumer spending. consumer debt that have me a little bit nervous. There was a stat about 7 million Americans are now 90 days behind on their car payments. It seems every other week there's another story about the mountain of student loan debt out there. I guess I have two questions. One is, how worried are you about these types of stories just in terms of what they could mean to the macroeconomic environment in America and a potential recession. And two, which is more concerning to you, of those two? Because the student loan debt seems like it's been going on for a while.

For some reason, the car payment, people being behind on their car payments to that degree, that actually hits me more on a gut level. Well, so on a macroeconomic level, debt is always a concern. When you look back at historical recesses, sessions, many of them were caused by too much debt somewhere in the system. The fact of the matter is when you have debt, you're bringing consumption forward. That means you cannot consume in the future. When you have an economy that is 70% driven by consumption, anytime you move tomorrow's

consumption to today, I think that's a problem. I would say for sure that I am concerned on an individual level about debt, really concerned. Wall Street Journal did a report last year about basically the readiness of Americans near retirement age. It turns out like this generation of folks who are near retirement are less prepared for retirement than any generation since the Truman administration. And a lot of it is because of wages being stagnant, higher health care costs, student loan debt, which we'll get into. But a lot of it is just general debt overall. And it's kind of surprising because the economy has been. going very well. This is a time when you're supposed to be paying off your debt. But that's not

what people are doing. Some of the stats that the Wall Street Journal had was that in 1992, about 50% of the 50 and older crowd had debt. Now it's almost 70%. And what's really surprising about the student loan debt, if people think of student loan is a problem for people in their 20s, but that is becoming a bigger and bigger problem for the 60 and older crowd. In fact, that is the age group that has the biggest, the most amount of increasing debt. So, for example, the 16-year-older crowd has $86 billion in student loans. Either loans they took out themselves to go back to school and improve their education, or they're taking out loans for their kids or their grandkids.

But they're struggling. Something like in 2015, 40,000 Social Security recipients had their Social Security garnished to pay off student loans. And that's up over 300 percent from a... decade ago. That's crazy. It's crazy. So total debt owned by the 60 and older crowd, including credit cards, auto loans, and other types is up 84% since 2010. So I'm not sure exactly why that's happening, but I do know this. It's very difficult to retire when you owe other people so much money. So you, among other things, because you wear many hats here at the Motley Fool, you run our

rule your retirement service. And in doing so, you look at all manner of retirement investment vehicles, one of which is target retirement funds. For people who are looking to manage their debt, take care of themselves in retirement, when you look at target retirement funds, do you think these are generally a good vehicle for people? I think actually they're one of the best inventions to come out of Wall Street in recent history. So for those who don't know, a target retirement fund is basically a mutual fund that owns other mutual funds. But it has basically a prudent allocation based on your target retirement date. So let's say you plan to retire in 2050. That's a far off retirement date. It's going to allocate your assets mostly in stocks,

U.S. stocks, international stocks, small caps, large caps. Some cash. and bonds, but it will do all that for you. It will rebalance for you. And as you get closer and closer to that retirement date, it's going to get gradually more conservative. So I think it's a great solution for the typical person who does not want to be a hands-on investor, may not know anything about asset allocation. They just want a one-stop shop for the retirement savings. I think it's a great idea. Now, from people who want to be a little bit more hands-on, they do have some drawbacks in that they tend to be probably a little bit more conservative than certainly the typical Motley Fool listener and reader. So even if you're 30 years from retirement, it is

going to have some money in cash and bonds. Whereas I think those with a more aggressive risk tolerance know that over historical 20-year periods, stocks have made money. So if you have a time period of 30 years, you're probably okay being 100 percent stocks. So I wanted to have you on show this week, in part because I always enjoy talking to you. Well, thank you, Chris. And I always end up being smarter as a result of talking to you, but also because this is the 10th anniversary of the start of Motley Full Money. And you were on the first episode.

I was. And I totally forgotten about that. I went back and listened to the very first episode, February 22nd, 2009. You were here in the studio. And it was a very different picture. The Dow was at a six-year low. It was certainly a different environment. It was a scary, scary time, right? I mean, at that point, we were still three or four weeks away from the market hitting bottom. And of course, when the market hits the bottom, you don't know it until many months later. I mean, just for context, on the day we've taped that episode, the S&P 500 was at 770. Now it's, as of this discussion, almost 2,800. Over the last 10 years, you factor in dividends and dividend

reinvestment. The S&P 500 has returned 16% a year. If you would have told us on that day whether we could expect 16% a year from the S&P 500, I'm not sure we would have said that we would have believed that. And I'm not saying that the start of Motley Fool money kicked off that run. I'm going to leave that to other smarter people to decide whether or not that's true, that one started the other. For those unfamiliar, we have other podcasts here at the Motley Fool, including the weekly show that you do with Allison Southwick Motley Full answers,

which people can check out wherever they get their podcast. Give me a sneak preview of next week's episode. Well, so the next episode will be the last episode of the month, and that is always our listener mailbag. In fact, that's sort of like the foundation of answers. That's part of why we stopped it or started it just to give people answers to questions. So we usually choose about 10 to 12 questions from listeners, answers almost always have a guest on helping us out with that.

And then we started a series where the second episode of every month is going to feature one of our financial planners from Motley Fool Wealth management, a sister company, The Motley Fool, where they talk about various life events. So we did one on marriage. We're going to have one on having a kid, divorce, death in the family. So their personal experience, but also their financial planning experience, about the best ways to handle those life events. Robert Brokamp, always a pleasure. My pleasure. Coming up, we'll give you an inside look at the stocks on our radar. Stay right here. This is Motley Fool Money.

As always, people on the program may have interested. and the stocks they talk about, and the Motley Fool may have formal recommendations for or against. So don't buy or sell stocks based solely on what you're here. Welcome back to Motley Fool, money, Chris Hill, here in studio once again with Jason Moser, Andy Cross, and Ron Gross. Next week, we're going to be in Austin, Texas. And when I say we, I mean everyone, but you, Ron. Sorry about that. I wasn't invited. Somebody's got to be here to hold down the fort. Exactly. And goodness it's you.

Exactly. You're the designated survivor. And if anything happens to us on the trip back, it's mine, the whole company? You're going to be hosting this show for the next 10 years. We're doing a listener meetup in Austin, Texas. And if you're in the area and want to join us, drop us an email. Radio at Fool.com. We will send you all of the details. As I touched on in my conversation with BroCamp, this is it, guys.

This is 10 years ago this week. We started Motley Fool Money. I just want to say a quick thanks, starting with you guys and all of the analysts who come in here. And as I say every year, to our listeners, they're not paid to be here. They're just doing it because I have incriminating evidence on them. We like to hang out with you. They like to hang out with me. I want to thank all of the program directors of our radio station affiliates.

If you listen to talk radio on the weekend, you run into a lot of infomercials. And so I don't take it for granted that there are program directors who say, no, I actually want to put a legitimate program on my station. So thank you to them. Thank you to Mac Rear, our producer and Steve Roed-O, our man behind the glass. It was a little over 10 years ago that the three of us got together and said, let's just try this for a month. Let's just see if this works for a month. We'll try it for a month, and it did. And then we said, let's do it for a second month. And we went from there. And last but not least, thank you to the dozens of listeners throughout the years. And here's to another 10 years,

guys. And thank you for a great, great time every week. Thank you. Let's get to the stocks on our radar. And in keeping with the 10-year theme, A special stocks on our radar. Stocks for 2029. Think in terms of a stock that you could feel comfortable buying a couple shares and not looking at it until we have our 20-year anniversary show. Ron Gross, you're up first. So I went the other way. So rather than a safe stock that you don't have to look at, I went with a stock that I think you need to hold for 10 years. CRISPR therapeutics. Biotech. Okay. Stick with me, Steve. Switzerland-based gene therapy company focused on CRISPR, Kass9 gene editing plastic.

You may also want to buy competitors, Editas, and Intellia to diversify. They're focused on cystic fibrosis, sickle cell anemia, blood disorders. Early stage, so it's going to be volatile. Put in your portfolio, look at it in 10 years. And the ticker for CRISPR? C-R-SP. Steve? Question about CRISPR? Sure. My question is with a company like this. Is it like 50-50 that this is going to work out great and perfect? You're going to do terrific and 50% chance this is going to go away? I don't have specific data for you, but I think it's potentially less than 50%, which is why I advocate

for a basket of these types of stocks. Jason Moser, what are you holding until 2029? Well, so we did a YouTube live video earlier this week, and we were asked this question on a 20-year timeline. So, Chris, I like logic. I tend to try to follow it. And so I'm going to use logic here. If I'm going to hold it for 20 years, well, I got to hold it for 10 years. I'm going to go with PayPal. Generally, I think that money is going to be very difficult to disrupt. But we are finding ourselves spending our money in a bit of a different way now, obviously, less cash, more sort of electronic transfers, mobile wallets and contactless payments and whatnot. PayPal, I think, plays into that space nicely.

A few different properties there in PayPal and Venmo and Zoom and whatever else they might bring into their universe there. And in 2018, they recorded close to $600 billion in total payment volume. is a network that is used by a lot of people that is funneling a lot of money from point A to point B, and I think that will still be the case in 20209. Steve, question about PayPal? Does PayPal have a shot in the, I have my phone, I go up and just basically put it down on the little reader, and it just zings my PayPal account. Right now, it seems to do that with my credit card. Am I missing something?

No, I think, I mean, I think that definitely they do. I think that what we're going to see as time goes on is more partnerships between PayPal, banks, and card issuers. That appears to be a really big opportunity for all those that are playing in the space today. Andy Cross? Timings everything. And my stock today is up 30%. The Trade Desk, Stevo, is the leader in what's called programmatic advertising. So as you're surfing around the internet and you see ads popping up, except on Facebook

and Google, which are kind of walled gardens. Trade desks is helping clients, advertising clients, place ads into those feeds. $2.3 billion worth of spend when across their technology, they really specialize and matching up using user demographics, websites, advertising clients to make sure advertising clients are getting the most from their spend. It's only an $8 billion company growing at north of 50% per year. That's going to slow down a little bit this year. But I look at that market over time.

It's a $700 billion market, and trade desk is getting more of it. And the ticker? T, T, T.D. Steve? So, Andy, who's the biggest competitor in this space? Google and Facebook are the biggest advertisers online. But Amazon is really coming up. They're a strong number three, so we've got to watch out for them.

Three stocks, Steve. You've got one you want to add to your watch list? I think I'm going to go with PayPal. All right. Jason Moser, Ron Gross, Andy Cross. Guys, thanks for being here. That's going to do it for this week's edition of Motley Full Money. Our engineer is Skebroido. Our producer is Matt Greer. I'm Chris Hill. Thanks for listening. We'll see you next week.