Deep Dive
Shownotes Transcript
Ding, ding, ding. It's earnings season. This week's Motley Fool Money Radio Show starts now. Everybody needs money. That's why they call it money. The best things in life are you. But you can't get them to you.
From Fool Global Headquarters, this is Motley Fool Money. It's the Motley Fool Money Radio Show. I'm Dylan Lewis. Joining me over the airwaves, Motley Fool senior analysts Jason Moser and Matt Argersinger. Fools, wonderful to have you both here. Hey, hey.
We are kicking off earnings season with a look at results from the big banks. We've also got a glimpse at our robotics future with one of MIT's leading experts. And of course, you guys have brought your stocks on your radar this week. Matt, Jason, I have been away since late March, getting married, gallivanting around Europe on my honeymoon. I returned a little tanner, a belly full of oysters and Portuguese wine. My first show back in the host seat in a little while. Jason, Jason, what have I missed?
belly full of oysters. I mean, are you rubbing it in Dylan? I mean, I love oysters. Golly. Hey, listen, congratulations, by the way, that's, uh, we've been talking about this a lot. It's a lot of work leading up to that event. So congratulations to you and your, and your wife for a successful wedding and hopefully what was a very enjoyable honeymoon. It's, it's,
a great stage of life. Can I just add congrats on being away for the last few weeks? That's been the right place to be. I think it's been the right thing for my portfolio, you know? Yes. I think that's exactly right. I mean, oftentimes we talk about the best thing to do is usually nothing. And it feels like these last few weeks have really, uh, have really put, put that, uh, put that to the task. But I mean, there, there obviously has been a lot going on. I mean, the
We've talked a lot over the last couple of years here in regard to the Magnificent Seven. How about those Magnificent Seven this year? All of them down, all of them underperforming the market year-to-date. Tesla down close to 40%, Nvidia down close to 23% now. That's been an amazing turnaround. Granted, I think there was a lot of enthusiasm that was brought forward into those stocks through 2024. To be sure, they're wonderful companies.
But it just goes to show that it's not always a straight line up. And I think those Magnificent Seven serve as an example of that. And then I think, really, wow, what did you miss? I can't believe you missed it. I have to believe you at least saw a headline or two in regard to tariffs, right? I mean, that's been the point of discussion for so many for the last few weeks. And it's created a ton of market volatility.
And you start to wonder, like, remember how this all started? I mean, this was a couple of months ago when we were talking about Canada, Mexico, China. There were border issues and it was fentanyl. And now this has gone global with like 180 countries in play and just deals out the yin yang. And nobody really knows ultimately what is going to happen here.
So you ask yourself the question of why this is happening. And I mean, there's the trade deficit conversation. And I get that. I mean, we certainly do import more than we export. And there are risks that come with that. I mean, you can see shrinking production domestically, job losses, higher deficit spending, things like that.
But then all of a sudden, you know, you also hear at least this conversation out there in regard to maybe the administration is really doing this to try to get interest rates pulled back down. I'm not saying that's why they're doing it, but the conversation is certainly out there. So it just leads to a ton of uncertainty and headline risk. I mean, everything today,
Everything could change tomorrow. We just don't know because one headline, one tweet could change the whole course of things. So it's been a fascinating time to be an investor for sure.
Other than that, how was the play, Mrs. Lincoln? Over to Matt. Hey, Dylan, well, congrats as well on the wedding. Jason hinted at this, but the MAG-7 is down, the market's down, and here, the S&P 500, as we take this, is still down roughly 15% year-to-date, really rough. But what investors haven't been doing, which is unusual, is they haven't really been buying the safe haven assets like Treasuries. If you look at Treasury yields, for example,
They're actually up since April 2nd. If you go back to April 2nd, before the tariff announcement, the yield on the 10-year treasury was just below 4%. As we tape, it's 4.3%. And I think that is not going as planned, or at least as the administration planned it, which is they expected maybe that interest rates would fall. That would maybe be a boost and help kind of alleviate the pressure, so to speak, from these tariffs and the implications for the economy. But that's not what's happening right
And I think there's a real danger to that. I mentioned this last week, but if rates stay high and if countries like China, Japan, the UK, various countries in the EU aren't exporting as much to the U.S. and not buying as many treasuries, or worse, they actively decide to stop buying U.S. treasuries,
I think we're in trouble. The housing market is already slow. That would certainly get worse. Small to mid-sized businesses that rely on credit and bank financing, their costs would go up, their access to credit would go down. You have consumers with very high auto and credit card debt. That could become a problem. I understand why the administration pivoted about a week ago when the 10-year yield popped over 4.5%. I think interest rates are
is what you got to pay attention to. I think to me, that's the bigger story over the last three weeks, Dylan. But then there's this, guys, have you looked at the price of gold lately? Because I couldn't believe this. This is Wednesday, as we tape, and I looked at a 20-year chart of the S&P 500 versus gold, and guess what's winning?
Is it gold? It is gold. So gold over the last 20 years, I'm just using the GLD, by the way, the Spider Gold Shares ETF. That ETF is up 571% over the last 20 years. The S&P 500 total return is 565%. Gold in 20 years has tipped over the market.
Wow. So, you know, what are we doing here looking at it? What are we doing talking about stocks? We could just be buying rocks. Go to Costco and buy gold bars.
Well, I think with that backdrop, plenty of things in the macro picture for us to zoom in on. And we now have the benefit of a lot of companies giving some commentary alongside their earnings, touching on topics like tariffs and rates. We also have some updates on consumer behavior and how folks are processing tariffs with their dollars. And it seems like we are seeing some consumers out there, Jason, trying to get ahead of
the expected tariff impact and expected price increases that might come with tariffs. Yeah, absolutely. Consumers and providers. I mean, we saw some auto data out here today based on data from Cox Automotive. They said the day's supply of new vehicles
has fallen from 91 days at the beginning of March to just 70 days this month. And the supply of used vehicles actually has declined by four days to just 39 days now. And so to me, the first thing that came to mind when I read this data, you know, I thought about
Anecdotally, my wife and I went through 2021, I think it was, we were buying a new car for the family. And it was not the easiest process. Supply was very limited. Prices were high unless you could actually work out a pretty good financing deal, which thankfully we were able to do. But not a lot of people are able to, right? I mean, kind of sometimes you got to take what they're going to give you. But it just reminds me a lot of these COVID years. And if you look at from mid-2020 until the beginning of 2022, right?
where we saw the supply chains really constrained for an obvious reason. You look at Ford and GM, both companies, their shares hit five-year highs at that point. CarMax, same thing. And CarMax is, I think, exclusively used vehicles. You look at all three stocks today, I think GM a little bit less so, but all three relatively stable.
depressed levels today, even Tesla. And so supply chains are in flux, obviously, for different reasons. And I think there could be a headline or two tomorrow or next week that changes everything. But you have to wonder if there's not an opportunity developing here in the near term, at least, because it does feel there's a lot of demand being pulled forward
predicting the challenges that are going to be in maybe Q3 and Q4. As an investor, I like to find a short-term catalyst or a long-term trend. I think this falls more into the short-term catalyst value style of investment here. But I think it's absolutely something to keep an eye on in regard to automakers. Switching over to earnings season, Matt, we saw some results out from United this week, helping us usher in the formal beginning of earnings season. They're one of the early reporters
They had good results, but also some warnings about the state of domestic travel. Are the skies looking friendly right now for the airline companies?
Not really, Dylan. But in United's case, and we heard from Delta a week ago, it's not as dire or cloudy as we might expect it to be so far. And in fact, I like that United's management team was willing to do something that Delta was not willing to do, which is actually provide guidance for the year, if that's what you want to call this. It was like two-stage guidance, right? Yeah. United provided two scenarios for its 2025 earnings.
In a stable scenario, I guess that's economic stability, they see earnings per share between $11.50 and $13.50. In the recession scenario, full-year earnings will be $7 to $9 a share. That is quite a range. But you know what? I give management credit.
for providing that because I think coming into earnings season, all of us were wondering which companies would be brave enough to even provide guidance and would they do something like this, provide scenario-based guidance? And United did. Going back to United's results really quick, they were pretty decent. Record revenue in the quarter. Earnings per share were ahead of expectations. They also talked about the last two weeks, the last weeks when all this tariff tantrum was happening, both premium cabin bookings and international bookings were higher and better than expected, which was
Those are the areas you'd expect to be most impacted by what's going on with the uncertainty, and those are holding up. So it looks like it's going to be a pretty resilient year for United and maybe for the airline industry as well. And it'll be interesting to see what earnings they actually hit this year.
Matt, I am with you on this one. I think the options for management teams at this point are no guidance, a single range that, let's be honest, very unlikely to hit, or scenario analysis. I will take scenario analysis over no guidance or a single range any day. I agree. I love that. I love it. Let's see more of those. All right. Maybe we'll later this earnings season. More earnings results coming up after the break. We've got looks at big banks and everyone's favorite industrial REIT. Stay right here. This is Mountain Full Money.
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Build your Range Rover sport at rangerover.com slash US slash sport. Welcome back to Motley Fool Money. I'm Dylan Lewis here on air with Jason Moser and Matt Argersinger. The big banks are out with fresh earnings numbers this week. We've got quarterly updates from JP Morgan, Bank of America, and Goldman Sachs. JMO, where do you want to start with this one?
Yeah, I think the common theme we've seen with the big banks -- listen, volatility isn't bad for everyone, Dylan. I mean, investors might have a hard time making sense of things, but these big banks are raking in some fees as investors continue to reposition their portfolios given the levels of uncertainty in the economy today. And of course,
I mean, a lot of that, most of it's all tied to tariff talk and trade relationships and how this is ultimately going to shake out. But Goldman Sachs, Morgan Stanley, JP Morgan, Bank of America all recognized record equities trading revenue in the first quarter here this year. And I think that is poised to continue, given the fact that it feels like we're probably going to
hang around these uncertain times for a little while. Maybe there's a headline that comes out tomorrow that changes things, but I'm not betting on that. But I think when you look at the banks in particular, we'll look at JPMorgan and Bank of America, for example. JPMorgan, strong quarter revenue was up 8% from a year ago. Earnings per share grew 14%.
They repurchased $7 billion of common stock, which I thought was really interesting. The stock has been at some elevated levels here recently, and Jamie Dimon wasn't exactly the biggest fan of repurchases at those levels. But I guess he sees the return there. And they announced a 12% increase in the dividend. So, you now have a yield there at about 2.4%. The group book value
It was up 12% from a year ago. But getting back to the trading revenue, the market's revenue for the business was up 21% year-over-year. Fixed income was up 8%. But equity markets were up 48%, which I just found incredible. Now, there was some recession talk in the call. Not a lot, though. It wasn't like a word that was just bandied about 50 times.
But right now, based on their research, they're pegging a recession in 2025 at basically 50-50, so a coin flip. You look at Bank of America, very similar in a lot of regards. Revenue grew a little bit better than 6%. Earnings per share up about 18.5% from a year ago. Brian Moynihan, CEO of the company, noted in the call that based on their research, they actually don't believe we'll see a recession in 2025. But going back to the trading revenue there, their global market segment,
that revenue was up 12% driven primarily by higher sales and trading revenue. And they grew
book value 8% from a year ago, which is really encouraging. I think with these companies, what they continue to do very well, I mean, they're obviously strong dividend payers, but they're doing a good job of returning value to shareholders with share repurchases. You look at Bank of America, that share count is down 12.5% since 2020. And JPM is down 9%. Now, both stocks have underperformed here year-to-date. Both are valued in tandem with less than 12 times earnings, though, which
That's historically not a crazy one way or the other, but I think there's a lot to be said for stability. And these could be a couple of nice ways to get that. JMO, you brought up the trading revenue there. Saw that with Goldman. We also saw that with Interactive Brokers this week. A very good week for them.
when they reported earnings. I'm guessing that as we see other brokerage businesses over the course of earnings season reporting, likes Robinhood, we're going to see a lot of trading activity pop up there. One thing I wanted to point out here as we're looking at bank results, net interest income helping out a lot of these banks as well. That rate picture you mentioned there earlier, Matt,
giving some nice spread for companies like Bank of America. Right. Big banks are in a good position. I think it's funny how measured they are about the tariff situation as well. Wells Fargo CEO Charlie Scharf last week, "We support the administration's willingness to look at barriers to free trade." Then Goldman Sachs this week,
went out of their way not to use the word tariff in any of their disclosures to investors or on a conference call. In fact, I love The New York Times, they called it, "A deaf feat of linguistics," by David Solomon and other executives. Instead of tariffs, you had Solomon saying,
This is all from New York Times as well. Quote, there are landscape changes, uncertainty about how certain things that are close will proceed forward, and a change in constructs that impacted how international businesses interact to the U.S. and global economic system. Sounds like Alan Greenspan giving a conference call at the Fed. I just think they know it's a good situation. They're trying to not bug the administration. But I guarantee you, even though they love the trading revenue, they love the interest income that you talked about,
Behind the scenes, they don't like the whole tariff situation and the uncertainty it creates for a lot of customers they're lending to, for businesses that they're investing in. I just want to see how measured they'll stay as long as this uncertainty continues.
You know, Solomon gets a lot of headlines for his beats. It's nice to know that he's also a lyricist. He's capable of putting pen to paper and writing pretty well as well. That's right. Bringing us home on our earnings rundown here, another early reporter, Prologis. Matt, this is one of your favorites to follow, and it is The Industrial Reit.
Amid all the tariff uncertainty, they are standing firm on their guidance and outlook for the year. I was very surprised in a positive way about that, Dylan. This is a bellwether for me. You think about Prologis' business, serves so many markets. Amazon is one of the biggest tenants of their warehouses.
And it was a solid quarter. I mean, core FFO, that's kind of read speak for earnings, that was up 9%. They leased 58 million square feet during the quarter. That was close to another record. Average occupancy across the portfolio up to almost 95%.
But you said it, Dylan, they didn't change their guidance at all for 2025. In fact, they said, if it wasn't for the tariff uncertainty caused by the April 2nd announcements, they would have actually raised their guidance. They saw improving fundamentals across the industrial real estate space. That was pretty impressive to me. Look,
Stock's down a lot. It remains one of my top holdings. If you use the guidance, if you trust the guidance that management's holding onto, the stock trades for less than 17 times its earnings expectations for this year. It currently yields 4.1% for the dividend.
Here's a nice little tidbit from the conference call. There was an analyst who asked about Amazon and what they might be doing in the industrial marketplace right now. The response from Pelagius' management was, "We have definitely seen Amazon in the market. As a matter of fact, we signed some pretty good deals with them this year." Things are looking pretty good for Pelagius despite all the trade and tariff uncertainty. I hope that maintains and so far management's not budging on guidance.
Matt, you talked about them being a bellwether. This is obviously a business that has a little bit more of a build-out period to a lot of what they do. Do you expect that they may slow down some of their growth and build-out expectations to help moderate their risk a little bit as we look out to a cloudy world? Definitely, Dylan. In fact, they actually pulled down some of their guidance for development starts. Not their operating metrics, but just the amount of development construction that they're going to be doing this year. They did pull that down a little bit.
All right, Matt, Jason, fellas, we are going to see you guys a little bit later in the show. Up next, we've got a glimpse into the future of robotics with MIT professor Daniela Roos. Stay right here. You're listening to Motley Fool Money. I don't care if Tuesday is gray and Wednesday, Tuesday. I don't care about you. It's Friday, not Thursday.
Dylan Lewis: Welcome back to Motley Fool Money. I'm Dylan Lewis. Fools, we are rapidly approaching the age of sophisticated robotics. Autonomous vehicles have been road testing for years, and companies are pursuing humanoid robots to take on rote work and manufacturing applications.
To better understand all the work that's going on in this space, I caught up with Daniela Roos. She oversees MIT's Computer Science and Artificial Intelligence Laboratory. Daniela talked me through how rethinking the materials that we use to make robots can open up more potential applications for them, the nature of developing truly autonomous robots,
and how most cutting-edge robotics work actually gets funded. I've followed some of your work in soft robotics and some of the different materials that you're using to create robots, and I think kind of change the concept of what a robot maybe even is for a lot of people. Can you talk a little bit about that?
So look, the millions of robots that are deployed in factories today are masterpieces of engineering. And they can do so much more than humans can. But they remain isolated from people on the factory floor because they are heavy and heavy
dangerous to be around. And so the question is, can we make machines that are much gentler, that can operate side by side with people and that are safer to be around? And inspired by this idea, we have began to imagine robots made out of a wider range of materials. We began to imagine going beyond metals and hard plastics
to think about silicone and paper and even food for making new classes of robots. And so the idea is to use the material that makes most sense.
And so we have built soft robotic arms and robotic hands that are inspired both by the human hand, but also by things like the elephant trunk. And with these notions, we can indeed imagine these new tools that can help people with physical work in a very safe way.
I feel like that's particularly important because there's a track of robotics work that is purely robotics work, but there's also a lot of work where humans and robots are working together or a human is being assisted by a robot. We see that with things like surgical robots in the Da Vinci, where there's a mix of what the human is capable of doing and then being aided
by machinery, is the hope that you can create more seamless interactions between who is using it and what's being used? In my mind, I want the machines to adapt to people rather than the other way around, which is the state of the art today. But more broadly thinking, robots, you can imagine robots as being employed in three different types of roles.
We can have assisting robots. So these are robots that follow people and help them do their tasks faster. We can have robots that augment the human capabilities. And so you can think about exoskeletons as falling in this category. Exoskeletons allow you to lift heavier things, allow you to move faster, etc. And then we can also imagine robots that operate fully autonomously.
While full automation works in controlled environments, this notion of robots working side by side and these robots teaming with people, we call them co-bots, this notion is especially powerful because it allows humans and robots to form tightly integrated teams. And it allows humans to do what they're best at,
while the robots do while they're best at. And there are so many exciting ways in which this notion of cobot is emerging, even as products. There are companies that are building
warehouse cobots, where you have a robot following the worker, and the worker picks up the objects and puts them in boxes carried by robots. This is because robots can move very well, but they have a much harder time at grasping and manipulating objects. This notion has been deployed at Amazon, in Amazon fulfillment centers,
for a long time, and there are new emerging companies that are doing the same. I was in a lounge at an airport recently, and I saw a robot that followed the servers.
And so the servers would pick up the dishes from the table and put them on the robot, and then the robot carried everything to the kitchen. And so this is an example of a symbiosis between what the machine is good at and what the person is good at.
The topic of full autonomy has come up a couple of times and artificial intelligence has come up a couple of times. How does that technology play into true full autonomy for machines and how we actually train those machines and have them start to do more and more for us? Well, so autonomy means that the machine is doing a task fully by itself.
And so, for instance, in warehousing, you can have these machines that can work side by side with people. But we also have robots that do things autonomously. And so, for instance, in the symbolic warehouse system, there are thousands of robots that are able to run around and pick up boxes and move them from one place to another.
These robots are fully autonomous. They operate in this kind of enclosed environment and they really operate really fast, but doing simple things. Now, if you think about autonomous driving, where we really aspire to have a robot taxi,
Here, the environment is much more complex. You have people who often do not follow the traffic rules. You have other cars, you have things that are moving around this notion of an autonomous car much faster. And in these kinds of circumstances, the robot is not so ready to reason about the surrounding world and act safely.
And that's, so level five autonomy refers to this notion that you have a machine that can drive in any environment, anytime.
And this remains a challenge in our field. But level four autonomy, where the robot is deployed in a controlled and carefully mapped environment, such as maybe geofenced urban areas in parts of the country where it doesn't rain much, or industrial sites, or closed-loop transit systems, in these cases, the vehicles can move
can move at moderate speeds with minimum exposure to high-speed interactions and complexity. So this part is kind of ready to go. So you see, when you think about autonomy, you have to think about where is the robot operating and what is the task of the robot. Even in a warehouse, when you just move from point A to point B and the environment is pretty static, autonomy is quite easy.
but in your home or in Boston at rush time, the robot cars would have a much more difficult time. And so there are so many exciting ways in which we can think about tackling this level 5 autonomy challenge.
And so from my point of view, rather than wait for all the technologies that are needed to make this grand leap, we are working on embracing something we call a guardian or a shared autonomy approach, where we are gradually increasing the intelligent driver assist technology.
component of the robot, you can think about the parallel autonomy system. You're the driver and then you have an AI system that drives in parallel with you and warns you if you're about to drive into traffic because you have a vehicle in your blind spot that you cannot see, but the sensors surrounding the car can see. And so this notion that we can embrace a progressive
path, where every step we have gradually more and more capability, is what we are following with the hope that we will get to the promised land sometime. It sounds like you are a big-time believer in level 4 autonomy and continuing to bring more and more functionality and help that way, but that level 5 is still quite a bit of a leap?
I certainly believe that there is a path to level five, but it's not now. So, I think the road to level five is long and our research really aims to bring us closer to a future where we may have level five autonomy and even more. Actually, my dream is to have a car that will be your friend.
and that will never be responsible for a collision. And so I want my vehicle to be more than a mechanism that drives me from point A to point B. I want my vehicle to do more for me. I want my vehicle to advise me. I want my vehicle to detect that my voice is a little bit sad, and maybe the vehicle could suggest, hey, Daniela, you had a hard day. Should we stop for an ice cream or something like that? Yeah, it wasn't my idea. It was the vehicle's idea to get the ice cream, right? Yeah.
That's a perfect excuse. You just reimagined a little bit there what I think even most people would have in their heads for autonomy. I'm curious, being on the cutting edge of this, what type of robotic assistance do you see coming to people's lives maybe in the next 10 or 20 years that...
that maybe is on our radar or not on our radar, but something that you could imagine being in people's homes or assisting them in less of a clear manufacturing capacity or something like that, more of a consumer capacity.
Well, 10 to 20 years is a long way into the future, Dylan. So, if you give me a long time, then I will say that we are going to have our laundry folding robots, we are going to have robots that can help us with our dishes, we're going to have even robots that can help us in the kitchen with food prep.
We can have robots that will help tidy up a space after your kids have scattered the toys everywhere. And so for many of these problems, we actually have prototype research-grade solutions. The challenge is scaling them up and delivering them at the price point that is affordable.
One of the things I've heard you talk about is the funding nature of a lot of this work. You hit on it a little bit there. The challenge of doing a lot of upfront work so that some of these things can be available to the mass market and be available at an affordable level.
What does the funding environment look like for a lot of this? For cutting edge work, is it primarily a lot of research institutions and education institutions? Are you seeing a lot of private companies really lead the charge with this? Where are a lot of the dollars and efforts coming from? So right now, funding for robotics is coming from a mix of private industry, government research grants, and academic institutions. But this landscape is not really even.
That's because unlike pure software AI, which scales very quickly and attracts massive private investment, robotics faces very high upfront costs. Also, robotics has much longer development cycles and it has infrastructure challenges.
And so we see many robotic startups that secure funding from corporations, and these corporations often have clear commercial applications in mind. And they invest because they see a direct benefit for their operations by investing in startups. We also see government investment from agencies like DARPA and the National Science Foundation and the DOE.
And these agencies are funding robotics research in academia and also in companies, because this is a very critical step before we can have products. These agencies also have translation funds that help move the research-grade prototype towards an MVP, a minimum viable product. But you see, I do want to emphasize that
The advancement really comes from the deep thinking in research laboratories, whether they are in academic settings or industry settings. That is absolutely necessary in order for new ideas to emerge.
and new industries to be shaped up by these ideas. So it's absolutely critical that this kind of funding continues. - Listeners, if you wanna hear more from Daniela, she's got two books out recently, "The Heart and the Chip," which looks at the intersection of AI and robotics, and "The Mind's Mirror," which is a survey of AI development and our future. In your future, you've got two radar stocks coming up from Matt Argersinger and Jason Moser. They'll be back with me in just a minute after the break. Stay right here. You're listening to "Modely for Money."
As always, people on the program may have interests 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 on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. The Motley Fool only picks products it'd personally recommend to friends like you.
Matt, Jason, appreciate you joining me for the back part of the show. We are going to head over to Radar Stocks in just a minute. But first, a quick update from new Starbucks CEO Brian Nickell and his plans to bring the chain back to glory. Come
Company out with a presser this week indicating they are updating their dress code to the company's green apron partners. And they're saying we want to see a black shirt for everyone behind the coffee bar, along with khaki, black or blue pants. Jason, does this update in uniform feel like a step on the way back?
back to Starbucks? I don't know that it recovers everything, but I definitely get it. I mean, it feels like it's in line with maybe what he did at Chipotle. It does seem like when you go to Chipotle, there's a consistency with the way folks are dressed there behind the counter. And I mean,
you got a job, right? You work there. And you know what? You don't have to work there if you don't want to abide by the dress code. But I think a lot of us recognize that Starbucks green apron. It's one of the few things that you think about. You think Starbucks, and honestly, one of the things that comes to mind is that green apron. So, I absolutely appreciate wanting some consistency there in the operation. I think that's always been a little bit of a difficult challenge with Starbucks, given the company-owned stores versus the licensed stores.
So I'm not exactly sure how that's going to work for them. But sure, I get it. I'm okay with it. All right. Your black shirt will be in the mail after we wrap up today's episode, Jason. And the green apron. And the green apron. I love it. All right. Over to stocks on our radar for the week. As he does each week, our man behind the glass is going to hit you with a question. Matt, you're up first. What are you looking at this week?
Dylan, I'm looking at Ryman Hospitality Properties, ticker RHP. So, this is a bit of a risky one right now, but I think there's enough margin of safety built into the stock. So, if you don't know Ryman, this is a REIT that owns large-scale resorts, very large-scale resorts, mostly under the Gaylord brand name. So, you've got
For example, Gaylord Opryland in Nashville, it's actually one of the biggest resorts in the world. It also owns the famous Ryman Auditorium in Nashville. There's the Gaylord National Resort and Convention Center in National Harbor just outside Washington DC. These properties are built with large-scale conventions and events in mind.
And you say to yourself, well, Matt, isn't this a business that's going to suffer in an economic downturn? Well, yes, of course it will. But I think the advantage Ryman has is that corporations, large groups, they book these rooms out for many months in advance, often years in advance. And it's one thing for you and I to cancel a vacation that we plan next month, but
But it's hard, much harder to cancel an event that you've got planned for 300 employees or hundreds of customers that you've planned out for many months. And when big groups cancel with Ryman, Ryman earns a big cancellation fee when they do. So there's a stickiness to the revenue. They've got kind of unique world-class assets. And now you have a stock that trades for less than 11 times management's earnings estimate and a dividend yield of 5.5%.
even if management has to reduce guidance a little bit because of the economy, I think that's a cheap enough valuation where you can get into the stock, start getting that dividend yield and wait for the environment to improve.
Dan, if I'm not mistaken, you've been on-site at a Ryman Hospitality property with some of our Fool events. A question about Ryman Hospitality properties, ticker RHP. Not really a question, more of a comment, Dylan, but we just had our annual meeting just last week or the week before. That's right, the week before. And I got to tell you, Matty, I am done with hospitality properties for a while. So, thank you very much, pal. All right.
Jason, seems like you have an easy one to beat this week. What's on your radar? Well, I'm counting on a comment, not a question from Dan. Talking about Alphabet this week. Alphabet, at the same time, it's the dominant force in global search, but it's also facing a lot of challenges on multiple fronts in regard to competition, growing in the AI space, as well as ongoing antitrust litigation that really does leave the company's future in a bit of an uncertain place.
There's an interesting stat here. Stat counter data showed that Google shared the global search market fell below 90%.
during the final three months of 2024, marking the first time since 2015. Now, you add to that the fact that they are trying to go through this acquisition of cybersecurity firm Wiz again, paying through the nose for it. Is that going to be worth it? We don't know. Will regulators even allow it? We do not know. But right now, we are waiting for Alphabet reports. They come out on April 24th after the market closes.
Dan, a question about Alphabet, ticker GOOG or GOOGL if you're into voting shares. Classic fumble. Should have stuck with Google. Alphabet's a terrible name for this company. I don't care. Dan, I got to be honest. Usually, I kind of know which way you're leaning with Radar Socks. This is a tough one. I don't know which way you're going to go. I mean, Alphabet isn't going anywhere, so they're going to win, but I don't have to like it, Dylan.
You just have to weigh in. And thank you for doing so. Matt and Jason, thanks for bringing your stocks. That's going to do it for this week's Money for Money radio show. The show is mixed by Dan Boyd. I'm Dylan Lewis. Thanks for listening. See you next time.