Dirty Words: Election, Tariffs, Spatchcock

Summary

Motley Fool Money: Episode Summary – "Dirty Words: Election, Tariffs, Spatchcock" (Released November 29, 2024)

Hosted by Dylan Lewis, Ricky Mulvey, and Mary Long

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1. Introduction and Thanksgiving Theme (00:00 - 12:00)

As the annual Thanksgiving season approaches, Dylan Lewis sets the tone for the episode by blending gratitude with financial insights. The hosts introduce their special guest, Tom Turkey (Rick Engdahl), who plays a pivotal role behind the scenes, ensuring the show remains honest and insightful during the holiday period.

Dylan highlights the current investment landscape:

• Moderated Inflation: "Inflation has moderated," he notes, signaling a more stable economic environment.
• Federal Reserve Actions: "The Fed has begun cutting rates," indicating potential shifts in monetary policy.
• Political Certainty: "We know who the next president of the United States will be," providing clarity for investors.

2. Market Overview (12:00 - 07:50)

Jason Moser expresses optimism about the market's direction:

"The market does like certainty a lot" ([01:34]).

He discusses the potential impact of the new administration on economic policies and interest rates, emphasizing that while inflation has improved, the battle is not entirely won.

Ron Gross declares a "soft landing" for the economy:

"The S&P500 is up 26%. NASDAQ up 27%. Not too shabby." ([03:32])

He highlights the resurgence of small-cap stocks and a diversification away from large tech companies, citing the Russell 2000's recent performance:

"The Russell 2000 has been very strong even recently, the last several days." ([05:06])

Dylan points out the impressive two-year returns:

"The S&P 500 is up about 60% on a total return basis. NASDAQ up over 80%." ([05:34])

Despite the strong market performance, Jason cautions that not all consumers feel the same economic well-being, highlighting the disparity in stock ownership:

"The wealthiest 1% hold 50% of stocks... The bottom 50% of U.S. adults only hold 1% of stocks." ([05:34] - [07:12])

3. Serving Up Humble Pie: Investment Missteps (07:50 - 12:00)

Dylan invites Ron and Jason to share their investment missteps as a form of "humble pie."

Ron Gross discusses his challenges with Target:

"The shares got whacked down 20% in one day because it's really continuing to struggle to get its inventory problems fixed." ([08:09])

Despite the setbacks, Ron remains optimistic:

"At 14 times forward earnings with a 3.6% dividend yield, it's worth the risk, reward, trade-off there." ([08:09])

Jason Moser shares his disappointment with Outset Medical, highlighting poor management despite promising technology:

"It's been led somewhat poorly. Ultimately that is reflected in just an awful share performance for me." ([09:41])

Dylan humorously adds a personal touch by mentioning his hope for good football over disappointing playoff results.

4. Thankful for These Stocks: Gratitude in Investments (12:00 - 21:07)

The hosts transition to expressing gratitude for their successful investments.

Ron Gross lauds Costco, celebrating its exceptional long-term performance:

"Up 1,300% for me over the years. That's a lot of percent." ([12:00])

He shares a personal anecdote about enjoying a shopping trip, emphasizing Costco's strong business model and potential for international expansion.

Jason Moser highlights Axon Enterprise as a company he's thankful for:

"The stock is up better than 140% just this year alone. About 250% over the last three years." ([13:21])

Dylan echoes this sentiment, mentioning Axon as his largest holding and best performer, underscoring the importance of a long-term investment horizon.

5. Steering Clear: Topics to Avoid at the Thanksgiving Table (21:07 - 32:28)

In the segment “Not at the Table,” the hosts discuss topics they prefer to avoid during holiday gatherings.

Jason Moser wishes to avoid discussions about elections:

"Nothing against elections... but we've been talking about it for a year. Let's move forward." ([15:57])

Ron Gross prefers to skip conversations about tariffs, citing their complexity:

"No one truly understands how they work... So I think we skip it this year." ([16:47])

Dylan interjects to briefly touch upon tariffs' impact on the market, prompting Ron to acknowledge their potential significance:

"Tariffs are obviously creating some concerns for companies and we're seeing some headlines that are affecting the market short term." ([17:22])

6. Listener Questions: Navigating Financial Careers and Portfolio Management (32:28 - 35:10)

The show addresses listener inquiries, starting with Alberto's question about financial certifications.

Ron Gross advises on relevant certifications:

"The Series 65 is what lots of financial planners have... CFP is a great idea. Chartered Financial Analysts are great if you're going into portfolio management." ([21:59])

Jason Moser shares his non-traditional path into finance, emphasizing passion and community:

"I started out as a member... and made some connections within the company along the way." ([23:17])

Spencer from Los Angeles asks about portfolio allocation:

"Are you looking at one brokerage account individually or a collection of brokerage accounts?" ([25:02])

Jason Moser clarifies his approach by differentiating between assets and investments:

"I consider all of my portfolios... I do not consider real estate in that picture because our real estate in this case... it's where we live now." ([26:09])

Ron Gross concurs, emphasizing the importance of consolidating accounts for accurate allocation:

"I consolidate all of my various accounts to one so I can look at my Costco position across accounts and see what allocation it is in total." ([27:45])

7. Holiday Shopping Insights (35:10 - 37:36)

Ed inquires about the significance of holiday earnings for retailers:

"Do you weigh the results that retailers put up in the holidays more when you're looking at a retailer and the management team's track record?" ([28:49])

Ron Gross affirms the importance of the holiday season:

"The holiday season is where many retailers make the most of their money in any given year." ([29:27])

Jason Moser discusses the extended duration of Black Friday sales and its impact on retailers' margins:

"It's hard to know what is noise there and what becomes more meaningful." ([30:10])

Ron adds that holiday earnings will be pivotal in assessing retailers' performance:

"Holiday earnings in the aggregate are not expected to be very strong this season for a lot of reasons." ([31:56])

8. Holiday Culinary Tips: Spatchcocking the Turkey (37:36 - 35:10)

A fun listener question from Neil about spatchcocking the turkey:

"Any recommended videos or info on sites to do this properly? Planning on convection roasting, not grilling." ([32:28])

Jason Moser enthusiastically explains his method:

"You're essentially cutting out the backbone, flattening out the bird... It cooks more evenly and makes for a better dining experience." ([32:59])

Ron Gross shares his own Thanksgiving dish:

"I am in charge of the sweet potato pie. Melted marshmallows on top." ([33:58])

Dylan appreciates the culinary contributions and engages with the hosts' personal holiday plans.

9. Movie Recommendations for the Holidays (35:10 - 37:36)

Dylan shifts the conversation to holiday movie releases:

"Disney's Moana. Two projects to beat that total by itself." ([35:10])

Jason Moser expresses reservations about the upcoming movies, highlighting personal preferences:

"I just don't understand how the movie can top that [Wicked]." ([36:24])

Ron Gross humorously admits his daughter's enthusiasm for "Wicked" songs:

"My daughter... went and saw it two days ago and she will not stop singing the songs." ([37:03])

10. Radar Stocks: Garrett Motion and Samsara (37:36 - End)

The hosts conclude with the Radar Stocks segment, spotlighting potential investment opportunities.

Ron Gross introduces Garrett Motion GTX, detailing its background and current status:

"They supply turbochargers and electric vehicle powertrains for passenger cars, small trucks... trades at only five times free cash flow." ([37:36])

Jason Moser highlights Samsara as his top pick:

"Samsara ticker is IoT... it's rewarded our members up since then, 240%." ([38:35])

Ron emphasizes Samsara's strong performance and future earnings expectations:

"Most recent quarter here, revenue growth of 37% from a year ago... Another earnings release coming out on December 5th." ([38:27] - [39:24])

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Conclusion

Dylan wraps up the episode by thanking the listeners and encouraging them to engage with the show’s content responsibly:

"Don't buy or sell anything based solely on what you hear." ([35:27])

With insightful discussions ranging from market trends and investment strategies to holiday preparations and personal anecdotes, this episode of Motley Fool Money offers a comprehensive blend of financial wisdom and seasonal warmth, making it a valuable listen for both seasoned investors and newcomers alike.

Transcript

[Dylan Lewis]

We're giving thanks and maybe airing a grievance or two. This week's Motley Fool Money radio show starts now.

[Jason Moser]

Everybody needs money.

[Ron Gross]

That's why they call it money.

[Dylan Lewis]

The best things in life are free, but you can give them to the birds and be like.

[Jason Moser]

From Poole Global Headquarters, this is Motley Fool Money.

[Dylan Lewis]

It's the Motley Fool Money radio Show. I'm Dylan Lewis. Joining me over the airwaves, Motley fool senior analysts Ron Gross and Jason Moser. Fools, great to have you both here.

[Jason Moser]

Happy holiday.

[Ron Gross]

How you doing, Dylan?

[Dylan Lewis]

I'm doing well. And if I'm not mistaken, I believe we have a special holiday guest with us this week.

[Ron Gross]

Gets me every time Gobbler every year.

[Dylan Lewis]

Longtime fans of the show know him as Tom Turkey, aka Mr. Gobbler. He is truly Rick Engdahl behind the scenes, keeping us honest with the Thanksgiving talk. We have our annual Thanksgiving multi course financial meal for you. We'll be serving up humble pie, talking about the topics we are skipping this year at the dinner table and answering questions that you have sent our way as our way of saying thanks to get us rolling. We are in late November and investors seemingly know more than they've known in a while. Inflation has moderated. The Fed has begun cutting rates. We know who the next president of the United States will be. A lot of the big questions have been answered for investors. Jason, how are you feeling about the market as we head into the holidays?

[Jason Moser]

Well, I'm feeling a lot better, I think, than we were probably feeling maybe a couple of months ago. I think a lot of it just keys into what you were just saying there. You just gave us a lot of certainty there, Dylan. There's a lot of certainty you just gave us. We of course know that the market does like certainty a lot. I do think it's interesting to think about the interest rate policy though, right? Absolutely. We're seeing inflation start to moderate and that's all fine and dandy. There are a lot of questions I think that have yet to be answered in regard to exactly how the new administration is going to pursue economic policy in the coming years once they take office here in January. And I think it's interesting to know in regard to interest rate policy. We've got a Fed meeting here in December and it wasn't all that long ago, just a few weeks ago pretty much it was a guarantee that we were going to see another rate cut. Now it seems like that certainty has pulled back a little bit. Well, actually rather a lot right now. It's Kind of a coin flip. Seems that the market is kind of saying, hey, maybe, maybe they'll cut rates, maybe they won't. Now, I think a lot of that just again goes back to how they're going to pursue economic policy in this new administration. Inflation, while it has moderated, it's improved. Clearly. I wouldn't consider that battle won yet because as we know historically, I mean, it can come in waves and it can resurface. So that's one question I think it's still worth keeping in mind. Is inflation fully beaten and if so, how is that going to impact interest rate policy? Again, going back to your points there earlier, there is a lot of certainty which I think that has investors feeling really good about the near term at least.

[Ron Gross]

Yeah, I agree with that. Soft landing has been achieved. I think it's fair to say it's official. Not an easy thing to have achieved. I will take it. You give me a year where the s and P500 is up 26%. Dylan. I'll take it. Not too shabby. NASDAQ up 27%. Not too shabby. Pretty exciting. A couple things when you look at the market as a whole that I think are interesting. We've been waiting for small cap stocks to come back. They've perpetually been undervalued relative to large caps. Everyone was like, it's got to happen sometime. It's got to happen sometime. Seeing some of that. The Russell 2000, up only 20% for the year, but up 10% for the last month. It's coming up on the outside. The Russell 2000 has been very strong even recently, the last several days. The second thing everyone has been waiting for is a broadening of the stock market away from large tech, away from Mag 7 to the other 493 stocks in the S&P 500. I think we're seeing that as well. The equal weight index of the S and P ticker symbol RSP is up only 18% for the year. Still good. But for the last month it's up 4.6% versus the S&P which was up 3.3%. It's starting to overtake the S and P a little bit as we see a rotation out of big tech companies and into more widely mid cap, small cap and other industries as well.

[Dylan Lewis]

You mentioned the year to date returns 20 plus percent for the NASDAQ and the S&P 500. That is on the back of a very good 2023 for the market as well. You go to the two year and S&P 500 is up about 60% on a total return basis. NASDAQ up over 80%. Jason, all while we've had one of the most anticipated recessions of all time. Maybe the market needs to eat a little bit of humble pie here. Maybe the investing community needs to eat a little bit of humble pie here.

[Jason Moser]

I think we're going to eat some humble pie here shortly. We'll get into that in a. I think it's very to me it's interesting to talk about this juxtaposition between the market's performance versus how consumers are feeling because I think there is a big difference there. It certainly feels like we are in a more risk on environment here recently. That's understandable. But the market's performance, this tremendous performance we've seen, we're feeling it, we love it. That's what we do. But I think it's worth remembering not all people feel it, not all consumers feel it. I was looking at some data, data here from a recent Gallup poll. They asked a question. Do you personally or jointly with a spouse have any money invested in the stock market right now, either in individual stocks, a mutual fund or some sort of self directed 401k or whatnot? If you look today, the numbers are very encouraging. It's about 62% today are invested. But when you dig into those numbers a little bit, it's not all equal. You've got the wealthiest 1% that hold 50% of stocks. That's worth around $21 trillion in equity. Now if you expand that out to the top 10%, that group holds 87% of stocks. That's a value of around $32 trillion. The bottom 50% of U.S. adults only hold 1% of stocks worth around 430 billion. So again, I think it's worth noting when we talk about the economy versus the market, they are two very different things. While we love to see the market performing well, it's not necessarily indicative of where the consumer feels like they are today.

[Ron Gross]

Yeah, I think that's fair. One quick comment about the market as a whole and the great returns we've had over the last two years. Dylan, 23 times forward earnings right now, the S&P 500, that's not cheap. The equal weight is a little better than that. Maybe 20, 21 times. Still not cheap. We will, mark my words, get a correction if you expect it. It shouldn't come as a we just don't know when. Don't time the market, stay in the market, ride out the corrections. The stock market Always comes back and always goes higher. It has 100% of the time. Don't worry about the coming correction. We don't know when it's happening. It will, but we're going to be okay.

[Dylan Lewis]

I appreciate you both serving up a little bit of sobriety there as we talk about those market returns. I'm also going to ask you to serve up a little bit of humble pie. We are net buyers of stocks and so we have enjoyed those great runs, but we haven't gotten everything right as we've looked out over the last year. Ron, checking in, what is your piece of humble pie?

[Ron Gross]

I think I've got to go with Target. I'm a fan as a consumer and also as an investor kind of. That's where the humble comes in a little bit. I first bought it back and bought it in 2020. It was one of the big boxes stores that were open during the pandemic. Those shares, those cost bases is fine. Everything is going well. Very recently the shares got whacked down 20% in one day because it's really continuing to struggle to get its inventory problems fixed. They've been mis inventoried, if that's a word, for quite some time. Target is much more reliant on discretionary purchases, whereas Walmart is more essentials that part of the market. The consumer is not really focused on discretionary items at this juncture. Still concerned about higher prices and other things that are going on in the economy. The Stock Got whacked 20% in one day. I did buy more full disclosure there and I still think we're going to be okay. But they do not have their act together. It's a competitive world out there between Walmart, Target, Costco and the like. I think at 14 times forward earnings with a 3.6% dividend yield, it's worth the risk, reward, trade off there. But it's not working out for me so well so far.

[Dylan Lewis]

Ron, you managed to do kind of a radar stock, kind of a piece of humble pie with that pitch right there for Target. It was very well done.

[Ron Gross]

Thank you.

[Dylan Lewis]

Jason, what's on your plate for dessert?

[Jason Moser]

Well, I think Outset Medical stands out as one this year. That has been terribly disappointing and fits this segment here. I mean, go back to October of 2023. I actually put Outset Medical on hold here in our service. The concerns there in regard to GLP drugs raising questions in regard to the company's market Opportunity Management had failed to file a letter for FDA clearance for their tableau cart. Remember, Outset is this home dialysis system. This is tremendous technology, but I think it's just been led somewhat poorly. Ultimately, the stock has just gotten pummeled here. You're essentially looking like a penny stock at this point. Right now. You fast forward to this year. It seemed like management had addressed a lot of these questions. The tableau card had received that FDA clearance. Management had struck a partnership with the largest privately held dialysis provider in the US Restructuring efforts paving the way towards profitability and everything looked good. Then the next quarter they just completely flip flopped again. To me, this was one where management just continued to let us down. I think it's a case where you've got an interesting business with tremendous and proven technology, but it's been led very poorly. Ultimately that is reflected in just an awful share performance for me.

[Dylan Lewis]

I'm going to go outside of the world investing on this one. I'm going to say I thought an Aaron Rodgers led Jets team would make the playoffs. Clearly that did not materialize. I remain hopeful.

[Jason Moser]

And you're a Jets fan too. I got a field, you got Bills are tough. We all thought really a lot of potential there.

[Dylan Lewis]

I'll be rooting for good football on the couch this holiday weekend. All right, after the break, we've got stocks we're thankful for and the topics we're steering clear of this year at the dinner table. Stay right here. This is Motley Fool Money. Welcome back to Motley Fool Money. I'm Dylan Lewis here on air with Ron Gross and Jason Moser. It's our annual Thanksgiving show and we're saying thanks all around. What better way to do it than to look inward at our portfolios and the stocks that we are thankful for? Ron, when you check your holdings, what makes your heart go gobble gobble with gratitude?

[Jason Moser]

That was actually Ron, by the way.

[Ron Gross]

I have probably used Costco in previous Thanksgiving shows, but it is one of my all time best investments, up 1,300% for me over the years. That's a lot of percent, Dylan. For a value investor, I don't often get those 13, 14 baggers. I'm going to give it some love this time around too. Quick anecdote. I've been a CostCo member for 15 years, but I've only shopped there three or four times, which is power of the business model because I keep paying my annual fee. Two weekends ago I said to my wife, we're going to Costco. We're going to make a day of it. We're going to take our time. 64 rolls of toilet paper later, we succeeded and we actually had a fun time doing it. I do love Costco. Great business model they keep us renewing year after year because of the great value proposition, great retention rates, great corporate culture, still has room to expand, especially internationally. 1,300% later. It's not a cheap stock by any means. It's probably more expensive than it's ever been. But it's one that I continue to be thankful for and will continue to own.

[Dylan Lewis]

I'm guessing, Ron, by hour two in that shopping trip, you were also very thankful for the samples that they give out in the store.

[Ron Gross]

They had these little mini pancakes. Excellent.

[Dylan Lewis]

Keeping you fueled up as you're shopping. Jason, what about you? What's a company you're thankful for?

[Jason Moser]

Ron, this is in no way a slight on Costco, but you know Amazon delivers toilet paper, if you didn't know. Just saying.

[Ron Gross]

So does Costco, by the way.

[Jason Moser]

Dylan, I'm going to go with one that I personally own. But really for me, I'm thankful more because I feel like our members have benefited so much from this one. Axon Enterprise. We talked about this company a lot over the last couple of years and for good reason. The stock is up better than 140% just this year alone. About 250% over the last three years. Again, I liken this company. I think it's the Apple of public safety. They just make tremendous hardware. They've developed the software and services side of the business to support all of that hardware. They continue to iterate, they serve a market that is in desperate need of what they're offering. And you look at the most recent quarter here, revenue was up 32% from a year ago. We saw annual recurring revenue, which I think is really encouraging here, up 36%. Closing in on $1 billion here in future, contracted revenue of $7.7 billion, up from $5.8 billion a year ago. And I think this is a company, it's an AI play. It's an under the radar AI play with all of the stuff they're doing in regard to this new AI era plan that they have, offering customers the ability to subscribe to just their expanding set of AI capabilities and features. It just leverages the relationship, right? And it gives their customers a reason to stick with them. And there's not really a big competitor out there that is pushing them too hard right now. Again, I think that changes at some point. You always have to be wary of competition, but right now Axon is just the clear market leader and it just doesn't seem like they're slowing down. And then this drone is a first responder offering. I mean, I think they're pursuing a whole new potential market opportunity in regard to that as well. So I think that the good times should continue with Axon.

[Dylan Lewis]

I too am grateful for Axon. It is my largest holding. It is my best performer. I'm looking at some slightly better returns than Ron is on his Costco position. But really it's a growth stock. So, you know, and it's taken me 15 years.

[Jason Moser]

I'm very thankful that you're in that boat with us, Dylan. I mean, that's just, that's terrific.

[Dylan Lewis]

Didn't happen overnight. 10 year, 10 year time horizon on a lot of those returns. But a good reminder, it takes a while to get there. All right, over to one of my favorite segments, not at the Table. These are the topics we are all hoping to avoid at this year's holiday celebrations. No shortage of things in the zeitgeist this year. What will be off the menu at the Moser household this year, Jason?

[Jason Moser]

I mean, I can't think of one thing that would make me get up from the table and go eat my dinner in front of the TV more than someone bringing up the election. Right? I mean, listen, nothing against elections. I'm usa, an election fan, USA through and through, thumbs up on the election process. But listen, we've been dealing with this. We've been talking about it for a year. The results are in. Talk about certainty, we understand the results, everything. We just. Let's move forward, right? I mean, I don't know that there's a whole heck of a lot to talk about there. And it just, it seems like we are just in a very polarizing environment right now. And to bring something like that up at the table, Think about something, bring something else to the table, please.

[Dylan Lewis]

Ron, what are you hoping stays off the table this year?

[Ron Gross]

A little tangential to what Jason said. That's a pretty big word for this show, tangential. I'm going to have to ask for no talking about tariffs at the table. And the main reason is that no one truly understands how they work, kind of including me. Who bears the cost? Does it hurt consumers? Is it a good negotiating tool? Does it help domestic manufacturers? What about the deficit? Unless you're an economist and really seems, maybe even not then no one really understands this stuff. So I think we skip it this year. Skip the whole conversation. Let's move on.

[Jason Moser]

I can see it. Someone asked Ron about tariffs and just under the table. He's like hitting his iPhone, googling like tariff history.

[Dylan Lewis]

It'd be a good, good opportunity for ChatGPT to shine there. We're not going to talk about the table, but we're going to talk about it now briefly for investors. There are things that pop up that are in the political realm. Tariffs are obviously creating some concerns for companies and we're seeing some headlines that are affecting the market short term. It's hard to know what is noise there and what becomes more meaningful. Ron, as you look at some of that stuff and trying to process it, at what point do those things become important and relevant to the thesis for business?

[Ron Gross]

I would start to think about them now. The headlines as of the last day or two, 25% tariffs on Canada, Mexico, additional 10% on China. You get some clues but you don't know actually what will truly end up happening. You could start to think about it, but if they actually happen, that's when I think you start adjusting your models because they will have serious impacts. It's just I can't figure out what they are.

[Dylan Lewis]

Jason, I'm going to flip this one around. What is something you'd rather be talking about this year at the Thanksgiving table?

[Jason Moser]

Oh, Lordy. Let's talk about how I made my turkey, right? I mean, I think that's going to be the topic of discussion there. But hey, let's talk about, let's talk about football. I love college football in the NFL. And listen, I always love talking stocks. I mean, we don't have to talk, you know, all of this other nonsense. We can still talk stocks, although my wife might not appreciate them.

[Dylan Lewis]

More on Jason Moser's turkey recipe in just a little bit. We'll be back in a few minutes. Stay right here. You're listening to Mountain Full Money.

[Rick Engdahl]

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[Ron Gross]

I want to thank you for letting me be myself.

[Dylan Lewis]

Welcome back to Motley Fool Money. I'm Dylan Lewis, joined again by Jason Moser and Ron Gross. Thanksgiving gives us the chance to express some gratitude, and I love taking the chance to appreciate the folks that allow us to do the show. Our partner stations all across the country that air the show each week on their radio stations and you, our listeners, for tuning in the dial and on your podcast feeds. Ron, Jason, it's a bit hard for us to deliver a thank you to dozens. Okay, maybe thousands of strangers all around the world. I think our best bet here for expressing gratitude might be to dip into the mailbag and answer some listener questions. How do you feel about that?

[Ron Gross]

Love it.

[Jason Moser]

Something truly to be thankful for.

[Dylan Lewis]

All right, our first one comes from the Motley Fool Money hotline. That's right, we have a hotline, and it is from Alberto. I'll let our producer, Rick Engdahl run the tape.

[E]

Hi, this is Alberto from Long beach again. I'm just calling because I'm going through the CFP process, taking classes through their UCLA extension program, and this is going to take about two years to fully finish it, maybe get the designation. I was wondering if there are other licenses or designations that one can go for so they can start capitalizing on offering services. Either the insurance route, maybe managing somebody's money, something, maybe a series, if you could just kind of touch upon them and say what options somebody has and the timeline it takes and what one can do with those licenses would be a huge, huge help. I really appreciate everything you guys do. Thank you very much. Hope to hear from you soon.

[Dylan Lewis]

Okay, so Alberto is looking to get into the business and wondering about the certifications that are helpful for setting the path to managing money. Ron, I'm going to let you start with this one.

[Ron Gross]

Sure, Alberto, great question. So insurance is licensed state by state, so there's not one unit uniform exam, as far as I know. By the way, check me on all of this because I may get a little bit of it wrong, but I believe it's state by state in terms of providing personalized investment advice or trading in securities for others or selling financial products. If you work for a broker dealer, you'll ultimately need a Series 7. Recently, they broke the Series 7 into two parts, the securities Industry Essentials exam. The SIE. You can take that even if you're not affiliated with a broker dealer, even if you're unemployed, you can get yourself all set up and study and take that. You will then need to be affiliated with a broker dealer to actually take the Series 7 to become a registered representative. But you can get the first SIE part under your belt. The Series 65 is what lots of financial planners have. You say you're studying for the CFP. You'll need the Series 65 if you want to give individuals investment advice or become an investment advisor. And you do not need to be affiliated with a registered investment advisor or an RIA to sit for that license. So that might be something you want to do. CFP is a great idea. It's a very strong designation. Chartered Financial Analysts. CFA is great if you're going to go into portfolio management or money management.

[Dylan Lewis]

Jason, I know you came to the fool with a different career shift and maybe not the more traditional financial analyst route. It might be interesting to hear about that a little bit too.

[Jason Moser]

Well, yeah. The only initials I ever had after my name were pga. I was a PGA member as a club professional for a number of years, but everything went back to I graduated from Wofford College in 95 with an economics degree. So I've always had the interest in finance and economics and money and whatnot. My dad piqued my interest in investing when I was just a kid and it was funny. We were overseas for a stretch of time for my wife's work and we were in Astana, Kazakhstan, of all places. And as you can imagine, it was quite chilly one day and I was just inside surfing around the Internet and I ran across a Fool article. And that's where I discovered the Motley Fool. And from there things just kind of snowballed. It became very clear to me that I had found my tribe. This was just people that think the same way. I kind of think long term investing, business focused. And to me it was just interesting and educational. So I started out as a member, plain and simple. I started out as a member. I was very active on the discussion boards and just learning more and made some connections within the company along the way and was able ultimately to parlay that into a position with the company and the Analyst Development Program that we have, frankly the Analyst Development program that we have, which is a homegrown program that we administer. It was super educational. It really taught me a lot about investment analysis and ultimately what I've been so fortunate to continue to do to this day.

[Dylan Lewis]

All right, we've got another one from the hotline. And just a reminder listeners, Our number is 703-254-1445. This one comes from Spencer in Los Angeles. Rick, roll the tape.

[E]

Hey, what's up fellow fools? This is Spencer from Los Angeles and I was always curious when you're referring to percentage allocation of your portfolio, whether that's an initial investment or a percentage, that is a sleep number, if you will, where you know a certain number where you want to sell a stock. My question is, are you just looking at one brokerage account individually or a collection of a brokerage account? An ira. Is real estate that you might own considered another component of that? If you own real estate, would that increase your pie number and thus like 30% of Nvidia stock would be less of a percentage of your pie if you have real estate incorporated and something like that, or additional accounts? Long winded question, but very curious.

[Jason Moser]

Thank you.

[Dylan Lewis]

Love that question. I don't think it's long winded at all. I think there's perfect context in there. Jason, I'm curious, when you are looking at the size of an individual position, are you looking at it within the context of your brokerage account? Are you looking at it within the context of your overall financial picture?

[Jason Moser]

Yes, an excellent question, Spencer, and thanks so much. For me, this basically boils down to a question of assets versus investments. So in short, I consider all of my portfolios. I've got 401k with work and I've got a traditional IRA and then I've got a discretionary portfolio that have been running for a while. I do have a number of different equity portfolios, but I consider everything in the context of those. In total, I don't consider real estate in that picture because our real estate in this case, it's not primarily an investment. It's our shelter. It's where we live now. I do consider our equity that we own in our home an asset. Don't get me wrong. At some point when we decide to move and our girls graduate college, hopefully we'll be able to use all of that equity to ultimately fund the purchase of our next home and take out little to no mortgage whatsoever. We can all hope across that bridge when we come to it. Now I will say if I owned investment real estate, I would definitely view it differently. We have owned investment real estate before and so I think it just depends on that position, your particular situation there, but that's how I view it. Question of assets versus investments.

[Dylan Lewis]

I like your answer there, Jason. And I think one of the things that comes to mind when I think about money that is in real estate is liquidity as well. That's a good point. A little bit more access to that money that's in the market or in funds than you might a home that you live in.

[Jason Moser]

Yeah, real estate is liquid to the extent that you can borrow against it, but you're still borrowing.

[Dylan Lewis]

Ron, anything to add to that one?

[Ron Gross]

I agree with everything Jason said. I consolidate all of my various accounts to one so I can look at my Costco position across accounts and see what allocation it is in total. I do not count hard assets like real estate as part of the allocation. When we talk about allocation, let's say we say 5% allocation to Costco. That's where we either want to own it ourselves or have our members own it. But then the market will move that allocation around. Stocks go up and stocks go down, not only in that one company but in all the companies you own that's going to go to 4.5%, 5.5%, 9%, 10%, hopefully higher and higher. If it's a good stock, at some point you want to rebalance. Once this company becomes too big a piece of your portfolio and you either not sleeping at night because there's too much risk associated with it, or if you just don't love it as much for it to be 10% but you're more comfortable with 5, then there's nothing wrong with rebalancing and selling some. Or even if you think it's completely overvalued and not going to return anything worthy in the future. Selling it all.

[Dylan Lewis]

Ron, I think that trip to Costco has taken you from fan that is thankful to full on evangelist. This is the second time it's come up on today's show. You are a changed man. All right, this next one comes to us via email Reminder, you can reach us radioool.com Ed writes in hey fools, we're in the thick of holiday shopping season. I hear you guys talk about how it is retail's big season. Do you weigh the results that retailers put up in the holidays more when you're looking at a retailer and the management team's track record? Ron, you've been talking retail a lot on today's show. Target, Costco. Does this factor in as you're looking at company results?

[Ron Gross]

Absolutely. It's called Black Friday for a reason, because historically the day that a retailer goes from losing money being in the red to making money and being in the black, it's not as important as it used to be, but it's still pretty important. And the holiday season is where many retailers make the most of their money in any given year. It is very important to their overall results. Companies are reporting all over the place. Kohl's not so good. Target not so good. Walmart just fine. Others are doing well. But it is a very important part of the revenue and earnings picture of pretty much every retailer. The holiday season very, very important.

[Dylan Lewis]

Jason, I know you follow some retailers as well. How does the holiday season factor in for you?

[Jason Moser]

Yeah, I feel like we need to introduce some sort of a bet or gambling component to this. Right, Like Black Friday over the years, right? It's expanded, it's extended far beyond just like this weekend that it used to be. Now Black Friday is like essentially right after Thanksgiving up until Christmas Eve. At what point does Black Friday enter October? Now I'm going to set the over under. I'm going to set the over under at 2030. By the year 2030 we will see Black Friday enter October. Are you guessing before that or after that? I don't know. Just something to think about because yes, I agree the holiday season is tremendous for these retailers. It's something that they're planning all year for and rightly so because that's when spending really happens. For me, a lot of times when I'm looking at these retailers, particularly to see how they've done over the course of the holiday season, I like to look at not only the top line growth, we want to see actually growth in that particular quarter, see how that reflects over the course of the whole year. But also I think another thing to keep in mind is looking at the margin picture, especially the gross margin. Because ultimately a lot of these companies, more and more we're seeing these retailers, they resort to big time sales, which is nothing new. All of these companies do it for this Black Friday period of time. But that comes at a cost. It comes at a cost. On that gross margin picture, I think it's interesting to look at how these retailers are performing in regard to that gross margin to see how those pricing strategies are really working out. We know that the larger retailers are able to cope with that a little bit better, bringing those savings back down to the bottom line simply due to their scale.

[Ron Gross]

Holiday earnings in the aggregate are not expected to be very strong this season for a lot of reasons. We've been talking about where the consumer in certain circumstances is hurting. It will be very interesting to watch. If it's better than expected, then watch these retailers really perform. If it's as expected, we'll probably get some kind of a lackluster situation in terms of stocks, but it will be very interesting to see as well as the forward guidance for the coming year. That's always an important metric that we get around now as well.

[Dylan Lewis]

All right, Speaking of the holidays, we got a particularly fun question over on Twitter. This one comes to us from Neil in Rockville. Hey, conviction hold. That's Jason Moser on Twitter. Need to tap into one of your superpowers. My wife wants to spatchcock our turkey this year. And I just heard you on Motley Fool Money. Any recommended videos or info on sites to do this properly? Planning on convection roasting, not grilling. Jason, I think this is probably the question you've looked forward to most on today's show. Have at it. How are you cooking the turkey?

[Jason Moser]

Well, I just love spatchcock because so many people think it's a bad word when actually the greatest, it's one of the great, greatest ways to cook a bird. You're essentially cutting out the backbone, flattening out the bird, whether it's a turkey or a chick. And it just cooks more evenly and makes for a, for a better, a better dining experience. But yep, I'm going to be spatchcocking our turkey on the Traeger this year, smoking that thing low and slow. And you know, I think a lot of people ask this question, do you brine your turkey? Do you not brine your turkey? You know what? I do brine it. But Dylan, I'm dry brining. I'm not going with the wet brine. Wet brine's too much work. You got to have a big tub and all that water dry. Brian, if you don't know what I'm talking about, Google it. You'll learn something.

[Dylan Lewis]

Or just reach out to him on Twitter. Easy enough. He is happy to answer all your culinary questions there. Ron, Neil and Rockville did not ask for your approach this Thanksgiving, but I will. You are known for your culinary feats as well. What are you cooking up this Thanksgiving?

[Ron Gross]

Neil's a buddy. I think he cares. We are traveling this season, so I can't do too much of it, but I am in charge of the sweet potato pie. Now, in my family, the sweet potato pie is served hot with the meal, not cold as a dessert. Very important. Melted marshmallows on top. It takes the place of like sweet potatoes or even a mashed potato, but we have those as well. So I'll be doing the sweet potato pies. And it's that with a little bit of stuffing kind of mixed in. A little bit of turkey, of course on the fork. That's your perfect bite.

[Dylan Lewis]

It sounds absolutely delicious. Wish I was at the Gross household or the Moser household. You guys are both putting out quite a feast wrapping us up here. Mike B. Wrote us a note via the comments feature in Spotify and I have to air this one because I've got you guys on the show with me, Ron Gross and J. Mo. This combo will Yield A top 10 podcast. It is the winning formula. Rinse and repeat. I'm guessing Mike will be a fan of this episode and I am a fan of having both you guys here. Listeners really appreciate you guys writing in, tuning in, doing all you can. We'll be right back in a little bit. We've got radar stocks coming up in a second. Stay right here. You're listening to Mouthful Money.

[Ron Gross]

Come on people.

[Dylan Lewis]

Now smile on your brother. Everybody get together. Try to love one another right now.

[Ron Gross]

Mouth potato.

[Dylan Lewis]

As always. People on the program may have interesting in the stocks they talk about. And the Motley fool may have formal recommendations for or against. So don't buy or sell anything based solely on what you hear. All personal finance content follows Motley fool editorial standards and is not approved by advertisers. Motley fool only picks products it personally recommends to friends like you. I'm Dylan Lewis, joined again by Ron Gross and Jason Moser. If you are a fan of movies, last year's Thanksgiving box office was a bit of a downer. Only pulled in around 125 million. But things are looking up this year, gents. Disney's Moana. Two projects to beat that total by itself. The sequel is hitting theaters Wednesday and expecting a pull in somewhere north of $135 million. There will be some other heavy hitters in the lineup this year. We have musical book adaptation Wicked. We have the long awaited sequel Gladiator 2 hitting the big screens. Jason, are you seeing any of these movies with your family while everyone's home?

[Jason Moser]

Gotta admit, Dylan, I'm pretty uninspired here. I will give cred credit where credit's due. I think with Wicked. Listen, I had the good fortune of seeing that on Broadway several years back with our girls. So that was a tremendous experience and a wonderful production. I just don't understand how the movie can top that. And frankly here it's like three hours long. So hard pass Gladiator. Hey listen, I love that movie. Gladiator 2 looks like it's all AI out, so I think maybe I would at least go see Moana with the kids because that would just take me back to a day when they were just little girls and we had so much fun doing all of those little things together. But yeah, any which way you cut it, eh? I guess it could be a better holiday season.

[Dylan Lewis]

Ron, you grabbing any popcorn?

[Ron Gross]

I actually don't think I am, Dylan, but I feel like I've seen Wicked because my daughter, who's home for the holidays, went and saw it two days ago and she will not stop singing the songs. In fact, I had to say, I'm going on the radio show, I gotta stop singing. It's gonna get picked up in the mic. So I feel like I'm there. I don't need to go there for three hours.

[Dylan Lewis]

I have a feeling I will be there for three hours. I have a feeling that is in my future for Thanksgiving. All right, let's get over to stocks on our radar. Our man behind the glass, Rick Engdahl, is going to hit you with a question. Ron, you're up first. What are you looking at this week?

[Ron Gross]

Garrett Motion GTX is what my friend Bill Mann calls an orphaned spinoff operating in a dying industry with complex financials and a recent bankruptcy. So what is not to love, Dylan? Fantastic. But our Value Hunter service does think it's an interesting deep value candidate. They supply turbochargers and electric vehicle powertrains for passenger cars, small trucks. It was spun out of Honeywell International. That's H O N. They did have to file bankruptcy because they were settled with asbestos liabilities as part of that spinoff. But now they're back. Now they're back public, things are looking better. They still have a lot of debt, but they're paying that down. They're making money. We've got a high performing company with low expectations, trades at only five times free cash flow. Could be interesting. I'm going to maybe take a nibble, but I've got some more work to do.

[Dylan Lewis]

Rick, a question about Garrett Motion.

[Jason Moser]

Ron, you had me at dying industry. Is that something you look for as a value investor? I'm not a value investor myself.

[Ron Gross]

If you're going for deep value, you look for the ugly.

[Dylan Lewis]

Jason, you might have an easy hurdle to clear this week. What are you looking at?

[Jason Moser]

One of my favorite tickers out there. Samsara ticker is IoT a company recommended back in February 2023 and it's rewarded our members up since then, 240%. Remember, this is a company, they operate the connected operations cloud that connects all of the IoT devices that a company has and ultimately a business that continues to perform very well. Most recent quarter saw revenue growth of 37%, annualized recurring revenue growth of 36% and a 41% jump in large customers. They have another earnings release coming out on December 5th. That's one I'm following.

[Dylan Lewis]

Rick, I think I can speak pretty comfortably here. Are you going with Samsara as your radar?

[Jason Moser]

Samsara has been JMO's radar stock so many times I keep having to come up with questions for it. And I just wonder when it gets off the radar and onto your actual portfolio. Has that ever happened? No questions needed. No questions needed.

[Dylan Lewis]

The ticker is just too good. It speaks for itself. Jason, Ron, appreciate you bringing radar stock and thankful for Rick Engdahl behind the glass putting the show together. That's going to do it for this week's Motley Fool Money radio show. The show is mixed by Rick Engdahl. I'm Dylan Lewis. Thanks for listening. We'll see you next time.