Motley Fool Money - Who's Got Pricing Power?

Episode Date: February 11, 2022

Warren Buffett called it the "single-most important decision in evaluating a business". If a business can raise prices without losing customers, it tends to be rewarding for shareholders. It also shows up in some of the companies Ron Gross and Jason Moser analyze as they discuss: - Disney's surprising 1st-quarter results in Parks and Disney+ subscribers - Peloton changing its leadership and tightening its purse strings - Affirm Holdings accidentally tweeting its earnings results too early - Pepsi & Coca-Cola telling similar stories with profits and higher costs - Cloudflare gearing up for 2022 - The latest from CVS, Chipotle, and Zillow - Two stocks on their radar: Brookfield Renewable Corp. and The Trade Desk Plus, Bill Shea from The Athletic offers an advertising preview of Super Bowl 56 and discusses how streaming video platforms are influencing the ad-buying landscape in live sporting events. What are you doing on February 18th? If you want to join our members attending the "Investing Essentials 2022 & Beyond" event just click here: http://2022.fool.com Stocks discussed: DIS, PTON, AMZN, NKE, AFRM, PEP, KO, NET, CVS, CMG, Z, BUD, PLNT, GM, COOK, BEPC, TTD Host: Chris Hill Guests: Jason Moser, Ron Gross, Bill Shea Engineer: Dan Boyd, Rick Engdahl Learn more about your ad choices. Visit megaphone.fm/adchoices

If you're a small business owner, you already know what it takes to keep everything moving. You're juggling customers, invoices, and about 100 decisions every day. Thankfully, taxes don't have to be one more thing on that list. With Intuit TurboTax, you can get your business taxes done for you with a full service expert. TurboTax matches you with your dedicated tax expert. Who knows your industry understands your business write-offs and gives you the personalized advice your business deserves. upload your documents right in the app, hand everything off, and still feel like you're in the loop the whole way through. You can even get real-time updates on your expert's progress right in the app,

which makes it so much easier to stay on track. And you can get unlimited expert help at no extra cost, even on nights and weekends during tax season. Visit turbotax.com to get matched with an expert today, only available with TurboTax full service experts. Which companies have pricing power? Who accidentally tweeted out an earnings report during the trading day? And why should investors circle February 18th on their calendars? The answers to those questions and more straight ahead. Motleyful Money starts now.

That's why they call it money. Full Global Headquarters. This is Motley Fool Money. It's the Motley Full Money Radio show. I'm Chris Hill and I'm joined by Motley Fool Senior Analyst, Jason Moser and Ron Gross. Good to see you both. Hey, hey. I can do it, Chris.

We've got the latest headlines from Wall Street. We've got a closer look at the millions being spent on Super Bowl ads. And as always, we've got a couple of stocks on our radar. But we begin this week in the Magic Kingdom. Disney's first quarter profits came in much higher than Wall Street was expecting. Revenue from the park segment was double what it was a year ago. And Disney Plus added 12 million subscribers. Jason, always a lot to unpack with this company.

What is the biggest headline to you? Oh, feel the magic, Chris. Feel the magic, right? This report, I think, really kicks 2022 off on the right foot for Disney, with top line revenues up 34 percent, earnings per share, $1.6. It roared back from a challenging year last year. And the streaming business gets all of the headlines, it seems these days. But to your question there, I really, I think it was the parks business that really, that was

the attention getter that segment posted its second best quarter of all time. more than doubled from a year ago, and that sent operating income through the roof. And remember that with a business like Disney, there are a lot of fixed costs involved with keeping those parks open and the bills paid. So as traffic grows, they get more profitable. And we saw that on display this quarter. But an interesting data point they noted in the call that I think it's just worth remembering here, per capita spending, right? Spending per person at the domestic parks grew more than 40% versus the same quarter in 2019. And even more interesting, that's off of lower traffic levels than they saw in 2019, which of course makes sense. But it just goes to show that they

really do a wonderful job of monetizing those parks when they can keep them open. And I feel like we're at the point now where they're going to be able to keep them open on a more regular basis. There may be some ebbs and flows there over the coming year. But again, they followed it up, I think with very strong media and entertainment performance there. That revenue grew 15%. And you get into really the streaming numbers, and that's what everybody wants to know, right? So they finish the quarter with 196.4 million total subscribers. That means they added 70.4 million for the quarter.

That included 11.8 million new Disney Plus subscribers. And that brings that total to 130 million Disney plus subs now. And that's important because, right, they set this. this goal, this target of 230 million to 260 million Disney Plus subs by the end of 2024, I feel like we were probably all a little bit skeptical that they would be able to pull that off a year ago. I feel like now it's a bit more of a reasonable target, right? That's just 20% annualized growth over the coming three years. So it feels like they've got things going in the right direction here.

Yeah, Ron, when they launched Disney Plus, it was with a lower price point. This is a business that historically has exercised pricing power. If they're not doing it with streaming, to Jason's point, they're certainly exercising it in the parks. Absolutely. And what I love most about Disney is this great diversified revenue stream that does have pricing power, kind of across the board. But you've got Disney Plus for those that stay home. You've got the parks for those who are going out. It's a great reopening play, still trading around in the low 30, 31 times earnings, but earnings are still depressed. You adjust for that. You're back into the 20 times earnings for a really wonderful company.

I'm waiting for them to reinstate the dividend. That'll be an important indicator to me that things are on track. What a week for Peloton. It started on Monday with the Wall Street Journal and Financial Times reporting that Amazon and Nike were interested in buying the company. Then on Tuesday, Peloton announced it is laying off 20% of its staff and replacing CEO John Foley with former Netflix and Spotify executive, Barry McCarthy. Ron, where do you want to start? Boy, a lot to unpack. Quite the week. So the stock up more than 50% from Monday, but still off 75% from its 52-week high. As we know, to give some context, sales during the pandemic skyrocketed. Company acquired pre-core for

$420 million. Thank you. Management figured the gravy train was going to roll on a pretty major miscalculation that the business wouldn't take a major hit in a post-pandemic world. But as we're seeing, that's not the case. Companies seeing a sharp decline in customer demand as evidenced by this quarter's results, which they had outlined in a preliminary report in January. And guidance was well below expectations, which is what some investors are focused on. But as you mentioned, the stock did get a great big boost from rumors that maybe Amazon or Nike would acquire the company. I'm not seeing any real evidence of that quite yet. I'm counting

these as rumors for now. I'm sure there will be people that come in and make an actual offer, but we don't know quite yet. Company announced some major changes that they're going to undertake that were greeted favorably by investors. As you mentioned, CEO John Foley, founder, stepping down, Barry McCarthy, CFO of Netflix and Spotify will take over. Great credentials, But CFOs do not always make for great CEOs. It's somewhat of a different skill set. I'd imagine his job is to right size this ship rather than be the CEO for the next decade plus. We'll see how that plays out.

Finally, undertaking a sweeping corporate restructuring aimed at saving $800 million annually, laying off 2,800 workers, reducing marketing, rethinking their brick and mortar locations, reorienting their supply chain to use third-party providers, There's lots of different initiatives underway to kind of write this ship, make the cost structure appropriate for where it looks like the demand is going to be. Affirm Holdings was scheduled to report second quarter earnings after the closing bell on Thursday. Unfortunately, someone accidentally tweeted out the results during the trading day, and shares of the buy now, pay later company fell more than 20%. Jason, how bad were these results? Itchy trigger finger and get you in trouble, Chris.

I mean, the results were good, okay? So let's get that out of the way first. I think the key to understanding, I think the potential here is in a firm's mission, which is to deliver honest financial products to improve lives. So I think the affirm that we know today as a buy now, pay later company, that shouldn't be the same a firm that we see five years from now, right? I think the promise of this business is beyond just BNPL, and so it's worth keeping that in mind. But it was a good quarter. It can always be tricky to understand why the market may be selling something like this on any given day. It's worth remembering a firm doesn't make any money yet. They don't generate any cash flow yet. It's still valued something like 15 times trailing

sales. So it's going to trade on sentiment oftentimes. I think that really most of the selling is coming from the timing of revenue recognition. In this business, they're seeing a higher mix of interest-bearing transactions. And those interest-bearing transactions, that revenue is recognized over longer periods of time. And so you see the key performance indicators not quite lining up with revenue forecasts. That can create a little uncertainty there, but I don't think that's necessarily a problem. But if we get to the numbers, gross merchandise volume for the quarter was $4.5 billion, that was up $115 percent in well above their forecast from a quarter ago of $3.6 billion. And they noted strength, encouragingly, in travel and ticketing. That was up 314 percent from a year ago.

But if you look at total revenue, less transaction costs, that grew 93% right in line with the high end of their forecast. Active merchants increased from 8,000 to 168,000. Yeah, I know that sounds like a lot, Chris. And so there's a good reason. They signed on Shopify. So they get a lot of those Shopify merchants. That's what that is. But that's a good thing, right? So you saw consumers grow 150% from a year ago. We're seeing transactions per active customer grow 15%. I think all in all, the business is headed in the right direction. The selling could be maybe a mix of that itchy trigger finger and perhaps some questions on the revenue recognition. But all in all, I think the business continues to perform well.

I have to say in the increasingly automated world of investing, it's kind of nice to see that there's still a place for human error. There's still a role to play. It's nice to see you, right. Similar stories this week for two beverage giants, Pepsi and Coca-Cola reported strong fourth-quarter profits, but both companies warned about higher costs, which Ron really seems like a refrain. We're going to be hearing from everyone in the consumer goods industry. Absolutely across the board, but those with pricing power aren't hurt as much as those without. As Warren Buffett, one of the main reasons he likes Coke besides the fact that he loves cherry Coke is that the company does have pricing power and so does Pepsi.

So both companies did report higher sales as they were able to actually. increase prices. But the higher cost from commodities, transportation hurt the bottom line still. Coke's revenue increased 9 percent that was driven by a 10 percent increase in prices. And revenue at Pepsi, which does include Frito-Lay snack business, rose almost 12 percent, and that includes a 7 percent increase in prices. Both companies said inflationary pressures hard profits, cost rose for trucking, agricultural commodities, packaging, specifically aluminum, in a pretty big way. And Koch's operating income fell 28% for the quarter.

Pepsi's operating income fell a little bit less, but did fall 9%. Both were actually better than expectations, which as we know is typically what the stocks react to. A couple notes from management, Coke said the fourth quarter of 2021 was the first period since the pandemic started at the volume of its sales in restaurants and other venues was of head of 2019. Both companies are trying to right size their portfolio. portfolios. Coke is acquiring body armor sports drink, Pepsi selling their Tropicana juice

business. I think we're going to continue to see pricing pressures and price increases from both companies for the rest of the year. Have you seen the lineup for Pepsi's halftime show at the Super Bowl? Impressive. I can't wait. Coming up after the break, we've got the latest on cybersecurity, consumer health, and most importantly, burritos. Stay right here. This is my Motley Fool Money. Welcome back to Motley Full Money. Chris Hill here with Jason Moser and Ron Gross.

Nice week for Web Security Company Cloudflare. Fourth quarter profits and revenue came in higher than expected. Jason, the past 12 months have been a bit of a roller coaster for this business and this stock. How is 2022 shaping up for Cloudflare? Well, based on this report, I think it's shaping up quite nicely. This was another very encouraging quarter that shareholders should feel good about. If you're not a shareholder, it's not too late either. feel like you've missed the boat on this one because it's a big market opportunity to

pursuing. But they outperform their internal guidance, fourth quarter revenue totaled $193.6 million. That was up 54% from a year ago. They recorded dollar-based net retention rate of 125% that set a record for them. It was up 600 basis points from a year ago. So not only they're keeping their customers, but they're developing those relationships, they're growing those relationships, to those customers spending more. I think another very encouraging sign. They're free cash flow positive for the quarter, which was a nice little bonus here. They have very much a Bezos, a Jeff Bezos mentality with this business and reinvesting in it, even if management holds what would appear to be a little disdain for AWS and its pricing

strategies. But generally speaking, I think all things look great. I do have to, I have to tip my cap to him. A little shout out to Bill and Ted and the earnings release is always well. received Chris and Matthew Prince said, we had a most excellent 2021 capping off the year with fourth quarter revenue growth, yada, yada, yada. So that was fun to see. But they added 156 new large customers. Those are the customers that spend more than $100,000 per year. So that brings that total of 1,416. That's up 71% from a year ago. And it saw some nice gross margin performance there at 79%. I think the trepidation the market has today, we're going to see investments in this business on the front half of the year. And that's going to impact that

cash flow, again, on the front half of the year. Look more towards the back half to see that coiled spring a little bit. But all in all, they keep on doing what they say that are going to do. And I personally remain a very happy shareholder. Demand for vaccines and at-home COVID tests help boost fourth quarter profits for CVS. But guidance for 2022 kept shares of CVS from moving higher this week. Ron, is the expectation that moving out of the pandemic phase is bad for their business? Perhaps investors shouldn't have been surprised that management expects a 70 to 80% drop in the number of COVID vaccines it will administer this year. That seems like investors should have expected that and a 40 to 50% fall in COVID testing. Maybe the severity of that drop

is a little bit surprising. So they did have to cut the bottom end of their cash flow. They forecast for the year, which, again, investors don't like when guidance, even partial guidance gets cut. And that's what the stock reacted to this week. But demand was so strong for the quarter, 20 million vaccines, which was up from around 11 million in the preceding quarter, 8 million COVID tests, total revenue up 10%. Across their other business segments, healthcare benefits increased 8%. Pharmacy services revenue also up 8%. Management said 2022 is going to driven by health insurance and pharmacy benefit in the absence of COVID. But that doesn't assume the potential for a fourth booster. So that will be the wild card there. They're continuing

to execute on their Omni Channel health strategy, rejiggering the look of some of the stores, closing some of the other underperforming stores. So we'll look forward to watching that unfold during the year. Like all restaurants, Chipotle is dealing with higher costs in food and labor. Unlike most restaurants, however, Chipotle is raising menu prices without apparently upsetting customers. Jason, if their fourth quarter is any indication of their pricing power, Chipotle might be in a class by itself. Well, I'm glad Ron brought up Warren Buffett, because that really was how I wanted to lead this off with Chipotle, because inflationary times can make investing a bit more challenging. And like Buffett always says, brands and companies

peddling products that will always be in demand are great places to look in times of inflation. I think Chipotle clearly fits this bill. And management certainly believes they do have some pricing power to cope with stretches like this. The numbers seem to bear that out. Total revenue for the quarter up 22% to $2 billion. Comps up 15.2%. I really found it interesting, the digital sales growth of 3.8% that doesn't really sound like a lot, particularly when you compare it to previous quarters.

But I think that just is a good sign, really, that people are getting back out at it. I mean, people are going to restaurants and shopping and doing things. That's a good sign generally from a greater economic perspective. But I mean, we saw a good boost in operating margin there. I think what, 80 basis points. Their restaurant level operating margin up 70 basis points. And yeah, they did take some price increases here through the year. They're going to be, I think, very thoughtful regarding that going forward.

But again, looking at the market opportunity, just under 3,000 restaurants today. They recently up that guidance. They feel there's a market out there for 7,000 total restaurants now in North America. And that includes a lot of these smaller footprint restaurants, Chipotle restaurants and whatnot, looking more towards small town, USA opportunities, which I think is great. So all things considered, it feels like there's still plenty of room to run for. The king, I would consider the king of the burrito, Chris. After a rough fiscal year, Zillow appears to have ended on a high note.

Fourth quarter revenue was higher than expected. The loss was smaller than expected, and shares rose 15% on Friday. Ron, 2021 was just terrible for Zillow from an operational standpoint. Are they turning things around? Maybe, I'm going to say. Stock still off 75% from its 52-week high. Late last year, announced it would exit its home buying business after a faulty algorithm, of all things, had them buying properties at inflated prices. They're going to cut 25%. percent of their workforce. Lots of criticism about poor management communication surrounding that announcement, class action lawsuits also as a result. The shares did get a boost from this latest earnings report.

The results show that the company is unwinding that buying business faster than expected, and their other segment, their premier agent advertising segment, did increase 13%. As part of the unwinding, Zillow sold more than 8,300 homes in the fourth quarter, so they're trying to get rid of those homes as quickly as they can. Management said the company expects to post $5 billion in revenue and 45 percent EBITDA margins by the end of 2025 as it seeks to build a, quote, Housing Super App. That puts a stock at around six times projected 2025 EBITDA, which isn't bad, but there's just no indication how they're going to get to $5 billion from a base of around $2 billion right now. And the CEO said, if people don't believe it, at least they're going to hear

that I believe it. Well, I'm not a believer quite yet, but I'll be watching. Ron Gross, Jason Mazur, guys. We'll see you later in the show. Up next, if you've got $7 million burning a hole in your pocket, you too can buy a 30-second ad on the Super Bowl. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money. I'm Chris Hill. On Sunday, the L.A. Rams play the Cincinnati Bengals in Super Bowl 56. And for companies looking to promote their products and services, 30 seconds of ad time is going for as much $7 million here to discuss that. And more is Bill Shea, sports business writer from The Athletic. And he joins me now. Bill, thanks for being here. Hey, thanks for having me.

Let me start with what for me is the obvious question. Is it worth it? That's a great question. And on Monday morning, there will be a lot of CEOs and CMOs asking that very question. Yeah, it really depends on what a brand or company or organization is trying. to do. But if you want to get your name in front of as many people as possible, the Super Bowl is still the way to do that because you get about 100 million sets of eyeballs for that three or four hours on Sunday. And you get a lot of casual viewers, people who don't particularly care about the Bengals or the Rams or football in general. The TV commercials during the big game, as they say, become a cultural phenomenon. So, you know, you get all sorts of folks

watching and brands know that. If they want to move widgets or just get their name out there, I mean, this is one way and albeit an expensive way to do it. It seems like it's probably a little bit easier for the people who are just looking to get their brand out there. Speaking of which Budweiser is back this year after taking a year off, and some of the usual suspects, Pepsi, Doritos, people are going to see those. I think people are used to seeing them year after year. Is it easier for brand to advertise? as opposed to a business that is trying to drive some sort of action, like go to our website or something like that?

It kind of comes back to what you're trying to accomplish. And in the age of social media and Google and Yahoo, you know, you can track those metrics far easier than, you know, 40 years ago with the famous Apple 1984 commercial. It turned out, you know, Apple's next quarterly earnings report, like, oh, yeah, they sold a lot more computers or whatever it was back then. But companies like Budweiser and Pepsi, I mean, these are NFL sponsors already. They already have long relationships. If you do a clever ad and you're a young, small company trying to get your name out there,

I mean, this is definitely one way to do it. Those are usually one shot. They don't come back. You know, you see the occasional tourism aders for some oddball place or something. So, yeah, I mean, it's a calculated risk that you take, that you're going to get the brand recognition. And some of it is just for, hey, when it comes time to buy a new car, change insurance, whatever it might be, they just want their name in the mix. I'm like, oh, yeah, I heard of so-and-so in the Super Bowl, you know, just to think about it. That's enough for some of these brands.

For some of them, it's moving widgets. Sometimes it works, and sometimes it doesn't, and there's a new chief marketing officer the next year. About 40% of the advertisers this year are going to be new to the Super Bowl. My first question is, where does that number rank? That seems like a high percentage, or is that sort of the norm that every year, somewhere in the neighborhood of maybe a third to 40% are going to be new? From what I can tell, that's not an unusually high number. I don't think anybody's real shocked by that, because you, you know, especially this year, you've got the crypto space, you've got the sports gambling space. There is room for turnover, you know, for a lot of companies.

It's a one-off, especially smaller, you know, non-mega multinationals. It's a one-shot. You're going to spend that however many millions of dollars. That's it. You've blown your wad, so to speak, on the Super Bowl commercially, hope for the best. So that's not a real, it doesn't strike me as a really unusual number, particularly during the last two years of a pandemic that has been rough on all of American life, including some of corporate America, obviously.

Some choose not to come back just because it's a bad look or it's bad for the the bottom line. So I'm not really surprised by that. You mentioned earlier that on Monday, there are going to be some CEOs and chief marketing officers and probably some chief financial officers who are going to all be asking the same question, was this worth it? Is the risk of that higher for these newer advertisers? Because it seems like it would be higher for them as opposed to a business like Pepsi, which is sponsoring the halftime show and has been a steady advertiser for years. Yeah, the bigger advertisers. I mean, sometimes they deliver a clunker of an ad, but you know, these are multi-billion dollar companies and, you know, they have their marketing

budgets to burn through. So it's not a real big risk for them unless the spot is so incredibly insensitive or stupid thing. But, you know, how many corporations get canceled? But for the other companies, yeah, it is definitely a risk and they're going to look at all of the tracking metrics to see was this effective. And in, and in, It's not always just on the Monday following the Super Bowl, you know, barring something terrible, having gone wrong. But what's the next quarterly earnings look like? Did you move the widgets?

Is there an uptick and an EBITR, you know, revenue, things like that? And it's brand by brand what their success metrics look like internally. You mentioned Apple's iconic 1984 commercial. In the last, let's call it, 10 years or so, is there maybe not an equipment? equivalent to that. But in the last decade, has there been an ad that is sort of held up as maybe the gold standard, sort of the aspirational, when companies are thinking about, look, we're going to write this big check, not only to buy the time, but to make the commercial, because some of these ads involve celebrities. In some cases, it costs as much, if not more,

to make the ad as it does to run the ad. Over the past 10 years, has there been something that's sort of been like, yeah, this is what we're shooting for. This is the success that we're trying to achieve. It's hard to be what they call sticky with these sort of things, especially in the Super Bowl. We're looking at potentially 70-plus ads. We tend to sometimes remember the duds. It's just a little outside of a decade now, but 2011, there was the Super Bowl ad for Volkswagen with the little boy pretending to beat Darth Vader and using the force on the car. A lot of people remember that and still talk about that. That's viewed as a successful ad. You know, there was a one, and you have to figure me, I can't remember which company it was, but it basically was a, I think,

an insurance commercial and it involved a dead child. And that did not hit any of the right notes with anybody and was a bit of a dud. But a lot of the bigger brands, the Super Bowl commercials are extensions of ongoing campaigns, your spuds, McKenzie's, and things. And it was a bit of a dud. But a lot of the bigger brands, the Super Bowl commercials are extensions, things back in the day. But that 1984 Apple commercial, the 1980, literally 1984, George Orwell, that is still held up sort of as the gold standard. And that's really what set us on the path to what we see today as the Super Bowl and being sort of an advertising showcase for casual consumers and not just NFL fans. In terms of entertainment over the past 10 years, One of the big storylines has been the rise of streaming services, Netflix most obviously,

but also Amazon Prime, which has pushed its way into the NFL with getting the rights to Thursday Night Football. When you think about the possibility of Amazon investing more in that space, the possibility of Apple with its streaming service, does the presence of streaming services is almost guarantee that ad rates for the Super Bowl are going to continue to rise. Because just in the past year, we've seen the price go from about $5.5 million to, on average, around $6.5 million, to the streaming services make that inevitable. I think they definitely pay a role because we're in the heart of the streaming wars right now. None of those services are profitable to their parent companies.

You know, everybody's looking to scale up, subscriptions and usage. So, you had commercials are part of the way to get it out there. We're going to see some of that on Sunday. But I think it's the wider landscape with the broadcast industry. We've lost more than 30 million U.S. households, cable households. We were over 100 million, seven or eight years ago, and now we're sitting around 70 million or fewer. So everybody's looking for ways to get it. eyeballs to monetize them. But there's also sort of a reckoning in that we have a new normal.

Not as many people, even though there are more people in America in the world, not as many people are watching in prime time. We're not going to see TV shows getting 40 million viewers, 30 million viewers regularly like we may have when we had three networks back in the day when I was a little boy in the 70s. So there's sort of been a repositioning of expectations. The Super Bowl is holding steady. It did drop an audience a little bit last year. I think that was part of the wider 2020 into 2021 decline in people watching TV related to the pandemic. Over the past year, we've seen a rebound across almost all live sports. People have returned to watching, return to going to games, which I think helped. And I think the Super Bowl will recover an audience and that alone,

because it's the biggest thing. I mean, the last, the top 30 programs, all for all time audience, in American history, all but two were the Super Bowl. So these networks are going to be able to name their price for some time to come. I was surprised they hit $7 million this year. That surprised me a little bit, and that maybe become the average in the next couple of years. And some of these companies are certainly going to be willing to write that check. Last thing, and then I'll let you go. Are there one or two ads on your radar that should be on people's radar, either for the fact that someone's

taking a risk reportedly with what they're trying to do, or just there's a lot of buzz that it could be the next, maybe not Apple in 1984, but maybe it's the next Volkswagen with the little kid being Darth Vader. I've seen a lot of chatter about Planet Fitness and Lindsay Lohan, sort of a rebound for her after all of the tribulations. She's been through, you know, some of these ads are already out there. It's been a trend for a while that they're released on YouTube and social. or weeks or even months before the Super Bowl. So, you know, there's been some brands holdback.

There will be some surprises on Sunday. I'm kind of interested in seeing there's been a rebound in auto companies coming back this year. They tend to do really interesting work. I just saw GM using Dr. Evil and the cast of the Austin Powers movies. That'll be a fun one because I'm in Detroit, so that's near and dear to me. But, you know, I'm just interested to see the surprise commercials, the shockers that I didn't know about. The other stuff I've seen, I'm like, eh, okay, that's interesting. But I want to be wowed unexpectedly on Sunday.

For my money, The Athletic is a must for sports fans. And reading Bill Shea is just one more reason to subscribe. Bill, thanks for being here. Hey, thanks for having me. Coming up after the break, we've got details on a virtual investing conference. We're hosting next week that you will not want to miss. Plus, Jason Moser and Ron Gross return with a couple of stocks on their radar.

So stay right here. You're listening to Motley Fool Money. As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy ourselves stocks based solely on what you hear. Welcome back to Motley Fool Money, Chris Hill here with Ron Gross and Jason Moser. Once again, a couple of things before we get to raid our stocks. On February 18th, we are having a members-only event online called the Investing Essentials Summit.

This is an all-day event focused on helping investors like you master your investing mindset. make sense of the current market and pave the path to a $1 million portfolio. We also have an exclusive interview with the CEO of one of our most celebrated companies. So if you are interested, head on over to 22.fool.com to get 60% off a subscription to our Stock Advisor service just in time to access this event. Again, it's for our members, but you can join us. You can become one of our members by going to 22.fool.com. I will put that URL in the show notes.

I would also like to welcome the newest affiliate to the Motley Fool Money family of radio stations, WPMO in Pascagoula, Mississippi. It's our first station in Mississippi, Ron. Welcome. Good to have you. And a quick update for the dozens of listeners who were tuning in last week wondering about Emily Flippin. She did finally get her spicy chicken sandwich as part of that DoorDash promotion with ShakeShack, the whole EatCute.com. com thing. So I checked in with Emily. She got her sandwich. Speaking of food, Jason, real quick before we get to rate our stocks, food is such a big part of Super Bowl Sunday. Do you have a tip,

a recommendation for the dozens of listeners who are maybe thinking about their menu, their spread for Super Bowl Sunday? Well, I'm going to kick it up a notch this year, Chris, because you know I got that Trager for Christmas. I've just really been enjoying figuring out how to use it and all the different things I can do with it. I'm going to smoke some wings. this Super Bowl Sunday. I'm going to smoke them slowly over some hickory there. But then what I'm going to do, Chris, after they're done smoking, I told these listeners here already, they know about Big Daddy's boy howdy, right? They know about Big Daddy's boy howdy mustard sauce. I'm going to toss them in that mustard sauce. We're going to have Big Daddy's boy howdy smoked mustard sauce wings.

I can't give away the recipes, Chris. I can't give away the sauce recipe, but just trust me, trust me. I can already tell you it's going to be next level. But it sounds. like Hickory is a nice tip for people who are looking to do some smoking some meat. Hickory is a very good tip. And I tell you, that's the other great thing about Trigger, is they have so many different types of wood pellets. You can really experiment with all of those different flavors. That's one of the things that makes it so much fun. Ron, what about you? I've got two things I'm going to do. I'm going to do a mini hamburger slider with the kicker being a spicy, colabrian pepper relish.

Hey, no. Give it a little kick there. I think it'll be nice. And for the main course, I'm going with the Spatchcock chicken with garlic and herbs. Spatchcock is butterfying a chicken, removing the backbone so it lies flat on the cooking service and the chicken cooks evenly. I feel so proud of you right now, Ron. I feel like my mentioning of spatch cocking a chicken before has led you to this superior decision making. It's going to be great. It sounds like one of those moves that really plays well with the judges, like when you're plating on Iron Chef or something like that. As long as you're you're

execute that, then it's just, you know, how good is the flavor? Oh, sure. It's going to be amazing. Don't you worry. Let's get to the stocks on our radar. Our man behind the glass, Dan Boyd, is going to hit you with a question. Jason, Moser, you're up first. What are you looking at this week?

Sure. Well, going to be watching the trade desk, ticker TTD. They've got earnings coming out on Wednesday, February 16th before the open. Really just looking forward to status update with the company. The Connected TV continues to gain share. It becomes a more important part of their business. International continues to grow at a breakneck pace, growing faster than domestic, and that's expected to continue, which I think is really important considering what they do. You hear a lot of talk of

this unified ID or UID2 as they referred to it. This continues to gain traction as more and more parties move away from dependence on those third party cookies, looking for revenue of at least $388 million and adjusted ebata of at least $175 million. What do I like most about the trade desk in this market, though, Chris. We don't have to talk about the path to profitability because they're already profitable, Chris. And on top of that, their cash flow positive. Dan, question about the trade desk? Yeah, Jason, the trade desk is, of course, an ad buying platform. Are they going to be running a Super Bowl ad this year? I would have to believe that they have their fingers in that in some way, shape, or form. I'll be interested to hear.

Ron Gross, what are you looking at this week? I've got Brookfield Renewable Corporation, BEPC, global leader in renewable energy, one of the world's largest producers of hydroelectric power, which makes up more than 62% of its portfolio. They also have growing wind, solar, and distributed generation such as rooftop solar, their expertise in energy storage. They see continued growth ahead up to 20% annually through 2025. Should enable them to continue to generate strong cash flow, hike their dividend by 5 to 9% per year. Current yield is a solid 3.8% for those dividend investors looking out there. For a quality company that is really chasing a trend of the decarbonization of the world and the economy,

take a look at Brookfield Renewable. Dan, question about Brookfield Renewable Corp. I'm a little surprised at Ron's choice here, Chris. I'm not going to lie. This doesn't seem like a very old economy company, if I'm going to be honest. Were you maybe hoping for like a, I don't know, a tire company? Yeah, or Vulcan materials or some sort of railroad, you know, general Ron Gross stocks. Well, Dan, at our upcoming member event that Chris just talked about, we're talking about trends.

and I had the opportunity to talk about renewable energy and the decarbonization of the world as being a major trend that probably will have about $150 trillion thrown at it over time. And so this is one way you can play that trend. Dan, this is reminding me of the time, I think it was a couple of years ago when we were doing radar stocks and Ron came out, I think it was with CRISPR, and we all, I think, fell off our chairs because we couldn't believe Ron was. talking about cutting edge technology in the medical space like that. Do you have a stock you want to add to your watch list? Before I add the stock to the watch list, Chris, I just want to say

Ron has held with CRISPR and gene modification technologies since then. It's one of his favorite baskets of stocks. I'm actually going to go with him this week. Going to go with Brookfield because, I mean, trends. Let's get on them early if we can. Nice. Ron Gross, Jason Moser, guys. Thanks for being here. Thanks, Chris. That's going to do it for this week's Motley Full Money radio show. The show is Mixed by Dan Boyd. I'm Chris Hill. Thanks for listening. We'll see you next time.