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Quantum computing holds a lot of promise to impact fields such as climate science, pharmaceuticals, artificial intelligence (AI) modeling, and much more. Many investors are keen on getting in on the ground floor of new tech trends because, as artificial intelligence stocks have proven, buying early can pay off in spades.

That optimism may be fueling the staggering gains of more than 600% that IonQ (IONQ 5.29%) has returned over the past year. Some investors, no doubt, are wondering if they’re missing out by not owning IonQ. But there are a few reasons why investors may want to pause before buying IonQ stock. Here are a few.

Image source: Getty Images.

Expenses are rising, and losses are widening

IonQ is in growth mode right now, which means that the company is investing heavily into building its technology so that it can, ideally, outpace its competitors and generate significant revenue and earnings down the road.

There’s nothing wrong with that, and many growth companies, especially in the tech sector, do this. But it’s important to highlight how much money IonQ is losing in relation to its revenue. The company’s research and development spending spiked more than 230% in Q2 as the company invested in new tech and acquisitions. For reference, IonQ spent more on R&D in Q2 of 2025 than it did in the first nine months of last year.

That spending contributed to significant losses for the company of $177.5 million, up from a loss of just $37.5 million in the year-ago quarter. If we look at IonQ’s loss on an earnings before interest, taxes, depreciation, and amortization basis (EBITDA), things look a little better, but not great. The company’s EBITDA loss was $36.5 million in the quarter, an increase from $23.7 million in the year-ago quarter.

Revenue is growing quickly, with sales jumping 81% in the quarter, but it’s still a modest amount of about $21 million. With losses expanding and IonQ likely to continue spending on R&D and potential acquisitions, revenue will have to accelerate dramatically for the company to eventually offset its losses.

The stock is pricey, and quantum computing is speculative

Even if you’re comfortable with the company’s losses, I think IonQ’s valuation and the speculative nature of the quantum computing market are two more reasons to hold off on buying IonQ. The company’s shares have a price-to-sales ratio of 303, which is very expensive even by tech stock standards — with software application and infrastructure stocks having an average P/S ratio of just 4.

That means IonQ’s sales have to grow at a tremendous rate in order to justify its stock’s current premium price tag, making its most recent revenue increase of 83% in Q2 appear relatively modest.

What’s more, quantum computing is still in its early stages, and even some technology heavy hitters, including Alphabet and Microsoft, believe its practical use cases are still years away. This means IonQ could continue investing in quantum computing technologies, widening its losses, with revenue increases that don’t keep pace with spending, all while betting that quantum computing demand will be there years from now.

IonQ is not a buy

When you add up all of the above, I think IonQ is too risky to buy right now. Its share price has surged at a time when it seems like nothing could dent the stock market’s returns, and I think a little too much optimism has crept into the market, pushing valuations very high.

I think investors would be better off monitoring how well the company’s revenue grows over the coming quarters, see if it can narrow its losses, and find out whether the quantum computing market delivers on its high hopes. But for now, IonQ looks too speculative for my liking.

Taiwan Semiconductor Manufacturing Company (TSM 1.50%), also known as TSMC, is one of the premier manufacturers of advanced processors, many of which are used for artificial intelligence. The company’s strong position in this space and its growth over the past few years have resulted in its stock price soaring nearly 200% over the past three years.

Recent research from The Motley Fool sheds some light on how TSMC’s manufacturing technology is a step ahead, how it makes the majority of its revenue, and where most of its customers are located. Importantly, all of these factors work together to set TSMC apart from the competition and make its stock a smart one to own for years to come.

1. The company is a leader in advanced chip manufacturing

TSMC manufactures some of the world’s most advanced processors, and the breakdown of the company’s revenue shows just how much comes from its different manufacturing capabilities. Chip companies use the term chip node to describe how many transistors will fit onto a semiconductor, with the unit of chip measurement being nanometers (nm). Generally speaking, the smaller, the more advanced the processor.

Here’s a snapshot of Taiwan Semiconductor’s top five revenue generators, by chip size:

Data source: Taiwan Semiconductor.

This revenue composition is important to highlight because it shows that a whopping 60% of the company’s semiconductor sales are from the smallest and most advanced processors (3nm and 5nm) on the market.

No other company compares to TSMC’s manufacturing prowess, and it’s likely to continue outpacing the competition. TSMC has already sign 15 deals with tech companies for 2nm semiconductor manufacturing, leaving rivals, including Samsung, far behind.

2. Its advanced processors are driving its growth

Just as important as the technology behind TSMC’s revenue is what technologies those processors power. If we go back five years, smartphones were the driving revenue force for TSMC. Now, it’s high-performance computing (think AI data centers).

The company has dominated the manufacturing of advanced processors so well, in fact, that TSMC makes an estimated 90% of the world’s most advanced processors.

Here is the company’s revenue distribution over the past four quarters:

Data source: Taiwan Semiconductor.

TSMC’s making the majority of its revenue from high-performance computing is important because it shows that the company successfully adapted with the times, moving from its previously dominant smartphone segment to sales from chips to AI data centers.

More growth could be on the way, too, considering that semiconductor leader Nvidia believes technology companies could spend up to $4 trillion on AI data center infrastructure over the next five years.

3. U.S. tech giants drive demand

Taiwan Semiconductor is based in, you guessed it, Taiwan, but the vast majority of its sales come from selling processors to North American companies. About five years ago, North America accounted for just over half of TSMC’s sales, but that’s jumped to 75% currently. China and the Asia-Pacific region tie for second place with just 9% each.

Why does this matter? Some of the most advanced artificial intelligence companies, including Nvidia, OpenAI, Microsoft, Meta, and Alphabet, are based in North America. Taiwan Semiconductor’s shift toward sales in this geographic area is a reflection of the company successfully attracting the world’s leading AI companies to have their chips made by TSMC.

Is Taiwan Semiconductor a buy?

With TSMC making an estimated 90% of the world’s most advanced processors, the company outpacing its manufacturing competition, and artificial intelligence companies poised to spend trillions of dollars to build out and upgrade data centers, TSMC is well positioned to be a great AI stock for years to come.

Just keep in mind that the stellar gains TSMC stock has experienced over the past several years have been a result of the early AI boom, which means future returns may not be quite as impressive.

Rigetti Computing Inc (RGTI 18.29%) closed at $35.40, up 18.59%. Trading volume reached 144 million shares, about 3 times its three-month average of 54 million. The stock hit an intraday high of $35.81, matching its 52-week peak.

U.S. markets moved higher. The S&P 500 (^GSPC 0.06%) edged up 0.062% to 6,715.35, and the Nasdaq Composite (^IXIC 0.39%) gained 0.39% to 22,844.05, with select technology names helping indexes close in positive territory.

Among quantum peers, D-Wave Quantum Inc (QBTS 13.75%) advanced 13.97% to $29.21, while IONQ Inc (IONQ 10.13%) rose 10.32% to $69.60.

Rigetti’s surge was fueled by its September 30 announcement of purchase orders for two Novera quantum systems totaling about $5.7 million, underscoring progress in moving from research toward commercial deployment. This momentum follows earlier news from September 18, when Rigetti was awarded a three-year, $5.8 million contract from the U.S. Air Force Research Laboratory in collaboration with QphoX. Together, the developments have reinforced investor confidence in Rigetti’s transition toward commercialization and driven sustained strength in the shares.

Market data sourced from Google Finance and Yahoo! Finance on Thursday, October 2, 2025.

Shares of Alibaba (BABA 4.26%) are rallying again today, up as much as 5.5% before settling into a 4.4% gain as of 12:34 p.m. ET.

Alibaba held a big cloud event last week, giving a bullish outlook and raising its cloud spending forecast above its prior target of $53 billion over three years. Apparently, the outlook was encouraging enough for several Wall Street analysts to significantly raise their price targets on shares to start the week.

Morgan Stanley and Jefferies up their BABA targets

On Monday, analysts at Wall Street banks Morgan Stanley and Jefferies raised their price targets on Alibaba. Morgan Stanley’s Alibaba analyst team raised its target from $165 to $200, largely on the back of increased cloud computing growth. The analysts now actually see cloud growth accelerating 32% in fiscal 2026 and 40% in 2027. For reference, last quarter Alibaba grew its cloud revenue 26%, which was already an accelerating figure.

Obviously, generative AI is sparking huge new demand for Alibaba’s cloud services and models, with the Morgan Stanley analysts projecting the number of tokens doubling every two to three months. An AI token is a word or part of a word in an AI prompt or response that acts as essentially a “unit” of AI processing.

Meanwhile, investment bank Jefferies raised its price target from $178 to $230. The analysts cited “remarkable” progress on Alibaba building out AI infrastructure, innovating with its Qwen series of models, and developing useful software agents.

Image source: Getty Images.

Alibaba is still cheaper than the “Magnificent Seven”

Alibaba’s stock has rallied 113% this year in a remarkable AI-fueled turnaround. However, shares only trade at 20.7 times earnings, which is still cheaper than the large U.S.-based tech giants.

There are certainly risks to investing in China; however, it appears the government is now more supportive of the tech sector than the hostile posture it took back in 2021-2022. As such, it’s no surprise to see the country’s tech leaders doing much better today.

In this podcast, Motley Fool contributors Rick Munarriz, Lou Whiteman, and Jason Hall discuss selling decisions they wish they could take back. They also look at some stocks that could thrive in the new normal. There’s also a sporty look at some of this year’s biggest winners and losers.

To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. When you’re ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on Sept. 08, 2025.

Rick Munarriz: Don’t go on a path to sell destruction. Motley Fool Money starts. I’m Rick Munarriz, and today I’m joined by two of my favorite voices in Fooldom, Jason Hall and joining us for Hidden Gems, Lou Whiteman. We’re going to take a look at some stocks that we believe will head higher in the coming months. We’re also going to play a new game called Double Trouble. But first, investors spend a long time treating their stocks as soul mates. Sometimes they should be treated as cell mates. We spend a lot of time discussing meat cutes when it comes to stock ideas. Today, I want to talk about breakups. More to the point, what’s the decision to sell that you regret the most? Mine is easy, but I want to start with you, Lou. Like trying to figure out what to do with a blank spreadsheet square, let’s talk about your worst sell decision.

Lou Whiteman: I’m a terrible person to ask this because it’s so boring, Rick. Not because I’m brilliant, not because I don’t have terrible mistakes, but rather I don’t tend to dabble in the early stage companies that get these great explosions later higher. I assure you, if I would have owned Amazon or if I would have owned Tesla back in the day, I would have sold them, and I would have regretted them now. But I do have a lot of regrets, and I do think there’s a lesson there because I share a theme. Two really good companies I sold years ago. One, Axos Financial, the online bank. I think it’s up like 200% since then. I really regret that. The other is Loews, not the home improvement company, but the financial hotel conglomerate. It’s almost a double since then. The similarities, the reason I regret them, these aren’t the oh, my gosh, I’d be a trillionaire now, but I’ll be honest, I sold them without any good reason. I had no magic process. I had no guiding principle. I basically got bored with them, and I saw something shinier and flashier, and that is the worst reason to sell. Not dramatic declines. This just eats at me because this is the danger of acting on the whim instead of with real intent. Every time I look at those, I get a little sad inside.

Rick Munarriz: A lot of real world relationships end for the same reason, Lou. Jason, what’s on your plate?

Jason Hall: I could go with one that Lou mentioned. I could go with Tesla. I bought I believe in around 2016. I sold a couple of years later for a decent little profit. Stocks up 2,000% since I held. Rule Breaker investors that that followed the Rule Breakers portfolio have enjoyed 16,000% in wins owning Tesla. Now, clearly a financial mistake, but not sure that I regret it because I didn’t sell it for concerns about the business as much as just concerns about Elon Musk’s ability and interest in staying focused on Tesla, and concerns about the company’s ability to deliver more than just EVs and maybe batteries. I could also go with selling half of my Nvidia stake about two years ago. Stock is up 446%, and it’s never been below the price that I sold. I don’t really regret that though because I sold it at this point in my financial life where I’m thinking about position sizing, and it had become such an out-sized position in my portfolio. I’m still OK with that decision even though maybe I should have let that problem become a much bigger problem. But the one that I really regret, Rick, I even wrote about it on fool.com in August of 2013, and that was selling Microsoft, and it was right as Steve Ballmer was leaving and set to be replaced by Satya Nadella. I sold entirely because I just ran out of patience at really the absolute wrong time to have been running out of patience with Microsoft, and it’s been an 18-bagger since I wrote that article and since I sold my shares.

Rick Munarriz: Ouch, Jason. I have a story to share too. Invest long enough, and you’ll get a 10-bagger. If your aim is true, you may even wind up with 100-bagger, 1,000-bagger, a 10,000-bagger, or understandably even more rare. I have 100,000 bagger in my portfolio, and it’s killing me. I bought 500 shares of Netflix in October 2002 when it was a broken IPO, just a few months after hitting the market. After a pair of stock splits, I would have 7,000 shares worth $8.7 million today. Unfortunately, I have sold 99% of my shares over the past 23 years. I sold 80% just a couple of months into my shareholder tenure, and I regret that a lot more than the other 19% I paired back much later as the position became a larger part of my portfolio.

Lou Whiteman: My heart goes out to all of us, and terrible stories. Also, I don’t think we should be afraid to sell. If anything, I feel like I should be more open to selling for the right reasons. I think you can make bad decisions if you refuse to sell. But again, I come back to, looking at mine, you have to have a reason. You have to have a process and stick with it. If the thesis has changed, you should probably sell. If you don’t believe it anymore, it’s selling because you actually want to use the money for a life event, if you’re going to get married or you have kids. Look, that’s a reason to sell. We’re going to use the money. I’ve tried to work on being more purposeful to slow things down, to not react, not look for shiny objects. I think you can avoid the worst regrets by just have a plan, stick to it. It’s just, gosh, Jason, there’s so much stimulus coming at us. How do you stay on a plan?

Jason Hall: Yeah, Lou, you’re right. I think regret minimization is something that as investors, we have to sharpen that skill and really build that muscle. That doesn’t mean ignoring mistakes and pretending like they don’t happen. You have to learn from them. But one of the things that I’ve learned to do is to build a framework that helps me reduce the unforced errors, basically making short term decisions with long term investments. That’s a lot of times the things that leads us to sell too soon, and better align my actions with all of my financial goals, whether they are the long term ones, but also the short term ones too. Aligning those decisions based on what the asset itself is can be one of the most important steps to take. It’s certainly the one that’s helped me avoid most of the worst mistakes. You know what? My heart doesn’t go out to you, Rick. My heart doesn’t go out to you, Lou. I don’t feel sorry for myself here because I look at my portfolio, and overall, mistakes are part of the process, and I know all three of us have done quite well and we’re set out to reach all of our short term and long term financial goals. It’s part of the process, and hopefully, sharing these stories with others that have made mistakes. Fools listening, I hope this helps you out a little bit too.

Lou Whiteman: Yeah.

Rick Munarriz: My lesson is that you should never buy a stock just because it goes down. By the same metrics, you also shouldn’t sell a stock just because it goes up. I agree with you both, not dwelling on the selling, learn something and move on. Or in the words of Nicole Kidman as she walks into an empty AMC theater, somehow heartbreak feels good in a place like this. Coming up next, we shift gears to talk about stocks we like right now. Lou, Jason, we’re not a boy band yet, but like NSYNC, we’re going to go over some buy-buy-buys.

The market came under pressure on Friday after a week jobs report made it even more likely that the Fed will start to cut rates later this month. Every move creates an opportunity. I want to go around the room and see what stocks is on your radar as a potential buy ahead of what could be three months of small but potent rate cuts. Jason, what’s one stock you think will rise in the fall?

Jason Hall: I’m going to go on a limb here, and I’m going to bring up one that I don’t think that rate cuts directly are the reason that the stock is going to go up, and I’m going to give you a hot take on Starbucks. I’m going to give it to you in a lot less time than it would have taken you to get your favorite cup of caffeine from that coffee giant over the past couple of years. Starbucks’ shares are basically on a six-year highly volatile losing streak. Revenue growth has stalled. Tons of legit competition has emerged all over the world. We’ve got another IPO that’s coming up pretty soon in that coffee space. I know that sounds like a terrible stock to expect to go up, right, Rick?

Rick Munarriz: Yeah, but you had me percolating, Jason. Why do you think Starbucks will rise in the fall?

Jason Hall: In short, Starbucks looks like it’s finally working through years of problems that have hurt the business, and these problems were happening before we realized they were problems. The collision of too much technology that was driving a ton of orders ran into too much complexity behind the counter, along with a number of other poor operational decisions, hurt the customer experience, hurt the company’s relations with its workers. Here’s a stat. Starbucks hasn’t had a positive quarter of comps. That’s that important measure of retail of sales at stores that have been open for at least one year. Hasn’t had a positive comps quarter since the end of 2023. That’s seven straight negative comp quarters, seriously. Now, Brian Niccol, I believe is the best operator in the restaurant industry, was brought in just 13 months ago to fix really a broken business that’s attached to an incredible brand. There have been signs of life the past couple of quarters. Comps have still been down, but much less worse than prior to Niccol’s implementing the Starbucks’ Back to Starbucks initiative. When we combine that positive momentum over the past six months with a really brutal comp period that was last year’s fall quarter. It was particularly bad, comps were down a brutal 7%. I think the combination of low expectations and a low bar for what could look like pretty good results that sets Starbucks up to beat expectations when it reports in October, and I think there’s going to be momentum that can drive the stock up.

Rick Munarriz: Yeah, let’s hope so. Lou, tell us about a stock that you like here.

Lou Whiteman: Conventional wisdom has it that small caps do better in a rate cut environment because the cost of borrowing should come down, and smaller companies tend to be more on the edge when it comes to debt. With that in mind, what I’m watching is a stock called Montrose Environmental, ticker MEG. They’re only about $1 billion market cap. They’re a roll up, and they’re an active acquirer, so they have a lot of debt, specifically 330 million debt compared to just 11 million in cash. They’re the type of company that gets a longer lifeline or life gets a lot easier for them if their cost of debt can come down.

Rick Munarriz: Lou, I remember you writing about Montrose a couple years ago when it was a beneficiary of COVID-related testing. Why do you think it will rise in the fall?

Lou Whiteman: Yeah, that was more of a distraction. What they do at a core, they provide necessary services with environmental cleanup and environmental air quality monitoring, water quality monitoring. These are long term needs, Rick. These are things that we just any administration, whatever’s going on, there’s a need for this. Montrose has a lot of patents in areas like neutralizing micro plastics and getting them out of the water. What sets them apart from me is this roll up. It is a risk, but in an industry full of, basically, small and regional players, they are a national player. They’ve been a consolidator. They have the scale to take on bigger projects, and also large corporate customers that have operations all over the country. They have the option with Montrose to just do business with one vendor. If you’re a mining company, you can work with them nationwide instead of having to find a partner in every market they operate. This is no sure thing, but it’s intriguing, and if they can get borrowing rates down, their odds of success improve.

Jason Hall: One of the things that’s so compelling about what you’re talking about, Lou, is the market is littered with these sleepy little underappreciated companies in markets like that that are massively fragmented that have a good record of rolling up and consolidating. I think that’s worth taking a look at.

Lou Whiteman: It’s just expensive, and if the debt gets cheaper, just life gets easier.

Rick Munarriz: Yeah, find a consolidator in a fragmented sector, and you can make a lot of money that way. My stock is Zillow Group. There are two classes of shares here, but I’m going with the Class A voting stock trading on the ticker symbol ZG. Zillow operates the leading residential real estate portal with 243 million average monthly unique users.

Jason Hall: Wow, housing, not a beautiful market right now, Rick. What’s got you thinking that Zillow can rise in the fall?

Rick Munarriz: If financing rates start moving markedly lower in the coming months, it’s going to breathe new life into the depressed residential real estate market that has seen its transaction volume inch just 1-2% higher over the past year. Demand will spike as homebuyers cash in on getting more bang for their mortgage buck. Supply will also finally start to ease once homeowners aren’t afraid to cash out of their low rates on existing digs. Zillow lights the housewarming candle on both ends. The surge in demand creates more app and website traffic, and that’s a dinner bell for the real estate agents and other advertisers paying for exposure to this lucrative audience. More homes hitting the market will make it even more important to pay up to stand out on the platform. Zillow’s stock is beating the market over the past year, but it’s also flat with where it was five years ago. It doesn’t seem fair. Zillow is back to posting double-digit revenue growth, and adjusted earnings is growing even faster. It’s doing well now. It should really be doing well a few months from now.

Lou Whiteman: Rick, I love the stock idea, but I’m more intrigued with the three of us as a boy band. We need to talk about that more after this is over.

Rick Munarriz: We will, in harmony. When we get back, I break out a new game to see if Jason and Lou can sort this year’s biggest gainers from its biggest losers. Stick around. We’ll end the show in sync.

Jason, Lou, from our culture Exchange Program with Hidden Gems, let’s play Double Trouble. Let’s go over the rules because it’s a brand new game. I will mention a stock that’s been on the move this year. If you think it has more than doubled, say double. If you think it’s lost more than half of its value in 2025, say trouble. Simple enough, let’s go. First one, Freshpet, FRPT, the company behind refrigerated dog and cat food. Double or trouble, Jason?

Lou Whiteman: I’m going to say trouble. I hear about it so much, but maybe. I was going to say double. Well, just let’s have fun.

Rick Munarriz: We are having fun. But Jason is right, trouble, down 63%. Freshpet is still posting double digit sales growth, but it began the year with a steep valuation that’s high even in dog years. Next up, Wayfair. ticker symbol W, online furniture retailer. We probably know this company. Double or trouble, Lou?

Lou Whiteman: I haven’t personally bought anything in a while, but I think other people have. I’ll say double here.

Jason Hall: I think it’s bounced back. It’s struggled so much coming out of the pandemic. I think there’s been a little bit of a recovery.

Rick Munarriz: Yeah, it’s been quite a recovery, at least for the stock. Up 103%, so a double, you’re both correct. Wayfair is getting market share during a cyclical downturn, but in its latest quarter, adjusted earnings nearly doubled. Third up, we’re traveling far away for Banco Santander, SAN is the ticker symbol, Spain’s largest bank. Double or trouble? Start with you, Jason.

Jason Hall: Man, I think I’m wrong here, but I’m going to say double because I know European banks have just taken it on the chin, but I think there’s some life coming back into that sector.

Lou Whiteman: Yeah, definitely double for me, just where Europe’s going.

Rick Munarriz: Yeah, up 110%. The banking giant has been expanding across Europe and Latin America for some time, and early this year, it formed a partnership with Verizon to boost its presence in the US. Next up, C3.ai. Ticker symbol, AI. A provider of AI software tools for the energy industry and other enterprises. Double or trouble, Lou?

Lou Whiteman: This is trouble.

Jason Hall: Yeah, absolutely trouble. I don’t want to get sued, so I’m not going to say anything but trouble.

Rick Munarriz: Yeah, down 55%, net losses keep widening, and revenue is now going the wrong way. Having some challenges there, despite its awesome ticker symbol for the times. Finally, Newegg Commerce, NEGG, consumer electronics retailer. Double or trouble, Jason?

Jason Hall: I’m going to say double. I’m making a wild guess here. Completely coming from the perspective of a consumer of computer electronics, they’re still the gold standard.

Lou Whiteman: They were crazy a while ago. They’ve come back to Earth. It’s not trouble. It’s got to be a double.

Rick Munarriz: Yeah, not just a double. Up 452%.

Lou Whiteman: Still, wow.

Rick Munarriz: Yeah, revenue growth has turned positive in 2025 after three years of decline. That’s the good thing. But what’s really carrying it is mostly the fact that it’s riding the new wave of meme stock, so that’s happening right now for that stock. But clearly, the company that’s fundamentals at least are starting to turn the corner. Jason and Lou, thank you for going over the highs and lows of investing and price moves with me today. If you want to give the boy band a shot, we can try try try.

Lou Whiteman: Rick, I’m bullish on you. You’re a double.

Rick Munarriz: That sounds like trouble. Thank you. Thank you to the two of you. A double dose of wisdom to my me them. 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 or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosures, please check out our show notes. For Jason Hall, Lou Whiteman, and the entire Motley Fool Money team, I’m Rick Munarriz. May your days be sunny and your life, Motley Fool Money.

Shares of APA (APA 3.02%) rallied 4.1% on Wednesday as of 1:30 p.m. ET, continuing a second straight day of gains for oil stocks.

As was the case yesterday, oil prices leapt higher, albeit off of a low price, as tensions between NATO countries and Russia ratcheted up once again. But this time, the source of increased tensions came from President Donald Trump, in an unexpected reversal from his prior conciliatory tone toward Russia.

Trump gives his blessing to NATO strikes and Ukraine retaking territory

Yesterday, President Trump wrote on Truth Social that:

After getting to know and fully understand the Ukraine/Russia Military and Economic situation and, after seeing the Economic trouble it is causing Russia, I think Ukraine, with the support of the European Union, is in a position to fight and WIN all of Ukraine back in its original form.

The comments reveal a significant about-face for the president, who seemed to be more sympathetic to Russia than Ukraine at the beginning of his term. But it now seems the president is taking an adversarial tone with Russia, which could have implications for oil markets.

In a separate Truth Social post, Trump also advocated for Europe to cease all energy purchases from Russia, noting:

In the event that Russia is not ready to make a deal to end the war, then the United States is fully prepared to impose a very strong round of powerful tariffs… But for those tariffs to be effective, European nations would have to join us in adopting the exact same measures… they have to immediately cease ALL energy purchases from Russia.

Tariffs or sanctions on Russian oil or countries that buy Russian oil could have the effect of lowering supply, which could shoot prices higher, given that Russia accounts for about 10% of all global oil supply. Russia also sells lots of natural gas to Europe, so curtailing that could also boost international natural gas prices as well.

APA is a large upstream oil and gas company with operations outside of Russia, in the U.S., South America, the U.K., and Egypt. So, its production stands to benefit from higher prices if Russia supply is curtailed, either by sanctions or due to Ukraine’s new attacks on Russia storage depots.

Image source: Getty Images.

Think of traditional energy as a dividend-paying hedge

Oil price shocks usually come from geopolitical conflicts, which have the potential to harm the economy — and many of your stocks along with it. However, traditional energy stocks in oil and natural gas can benefit from those shocks, as we saw in 2022. Therefore, APA and its peers can act as a hedge against geopolitical conflict, while the stock also pays out a 4.2% dividend yield in the meantime.

Shares of UiPath (PATH 10.83%) rallied on Monday, with shares up 10.5% as of 3 p.m. ET.

UiPAth received a positive sell-side analyst note today, and was discussed extensively on Reddit message board Wall Street Bets (WSB) over the weekend. The combination sent UiPath shares rising, given that shares still trade some 85% below their 2021 all-time high.

Truist gives a thumbs-up, but WSB takes it from there

On Monday, Truist Financial analyst Terry Tillman wrote a note saying he came away “increasingly confident” in UiPath being able to meet or exceed its full-year outlook given on its recent earnings release, following a meeting last week with the company’s CFO, chief operating officer, and investor relations team. That being said, Tillman didn’t change his price target on the stock, leaving it at $12 per share and giving UiPath a hold rating.

While the commentary on full-year guidance is nice, the note by itself probably wasn’t enough to get the stock moving as much as it did today. Likely, the extra boost was provided by meme stock traders on the Reddit message board Wall Street Bets. Mentions of UiPath have increased recently, with one WSB monitor citing a 500% increase in mentions for the stock over the weekend. That likely came when one popular WSB Redditor posted Friday that his next big stock bet is UiPath. If other message board traders follow this poster’s bet, that could be spurring buying and short covering action on Monday.

Image source: Getty Images.

Do your own due diligence

UiPath is still down hugely from its 2021 highs, so if it can harness the power of AI to boost its automation software, the stock could stage a comeback. However, AI also has the potential to raise competition for UiPath, given that a number of AI companies, from the “Magnificent Seven” to OpenAI, are all looking to serve enterprises with AI automation tools.

That being said, that competitive threat has made UiPath trade rather cheaply for a software company, at just 4.3 times sales and 18 times next year’s adjusted earnings estimates.

Despite how much Americans spend to look younger, some pretty nice perks accompany aging. If you’re getting older, there are reasons to celebrate: Not only are you wiser, you’re also eligible for discounts at some of your favorite places. Here’s a sample of what you can find when you want to make the most of your Social Security or pension benefits.

Image source: Getty Images.

Cell Phones

Groceries

Hotels

Restaurants

Retailers

Travel

This list represents a tiny percentage of the discounts available to those 50 and older. Rather than taking more than you want from your retirement savings, here are tips for landing more discounts:

• Don’t be shy about asking: Even if it’s not advertised, many businesses are interested in catering to established consumers and offer price breaks to keep them coming back. You can save real money by making it a habit to ask.
• Consider AARP: If you’re not a member of AARP yet, that’s where you’ll find a shocking number of discounts. A standard AARP costs around $20 annually, although a discount may be available when you join. Spending $20 or less annually may just help you fight inflation.
• Carry ID: Some places require proof of age before granting a discount. You should be good to go as long as you have ID.
• Make banks work for your business: Despite being in the business of making money, here’s a breakdown of the some of the most common perks banks offer seniors:

-Waived fees: Banks often eliminate monthly maintenance fee for checking and savings accounts.

-Free checks: Some banks offer free or discounted checks.

-Safe deposit boxes: Ask your bank about discounts available to seniors on safe deposit boxes.

-Higher interest rates: Some senior discount programs offer a higher rate on savings accounts.

-Miscellaneous savings: Banks may offer additional perks like free bank drafts, discounted money

orders, and even prescription discount cards.

The power is in your hands as a consumer. For the most part, you get to choose where to spend your money. Whether you’re saving for a vacation or making sure you’re ready for the next bear market, it’s OK to make businesses work for your patronage.

AI stocks are soaring after Oracle and others posted record levels of investment, and most sector stocks are now trading near all-time highs.

However, one big name is getting left behind. That’s ASML (ASML 0.92%), the world’s only maker of extreme ultraviolet (EUV) lithography machines, which are used to make the most advanced semiconductors. ASML plays a crucial role in the global semiconductor supply chain, serving foundries like TSMC with its mammoth machines that cost tens of millions of dollars.

While ASML stock is up 17% year to date, it’s still down significantly from its all-time high, off 26% from its peak in July 2024, showing that the company hasn’t lived up to earlier expectations.

ASML was in the news last week after it invested in Mistral AI, following in the footsteps of tech titans like Nvidia that have invested in smaller AI companies. ASML is investing 1.3 billion euros in the European AI start-up in a Series C funding round. As part of the deal, they formed a collaboration agreement around the use of AI models across ASML’s product portfolio and to team up on research and development to benefit ASML customers.

Investors seemed to like the deal as the stock moved higher last week. Is it a sign of things to come? Let’s take a closer look at where ASML stands today to see if it’s a buy.

Image source: Getty Images.

Can ASML bounce back?

ASML’s deal with Mistral seemed to breathe some new life into the stock as Arete upgraded it to a buy, and Bank of America said that the Mistral investment could expand the stock’s multiple. In recent quarters, ASML has struggled with volatile demand for its machines, including in China, though it has touted strong demand related to AI. Unlike chip designers like Nvidia or even manufacturers like TSMC, ASML is exposed to a different product cycle as a semiconductor equipment manufacturer.

In the second quarter, the company saw strong growth with revenue rising 23% to 7.69 billion euros and net income up 45% to 2.3 billion euros. Bookings in the quarter were flat at 5.5 billion euros.

For the full year, management expects revenue growth to slow, calling for 15% revenue growth for 2025. For 2030, the company continues to target 44 billion to 60 billion euros, or 52 billion at the midpoint, up from 28.3 billion in 2024. That implies a compound annual growth rate of just around 11% at the midpoint.

ASML has a competitive advantage in the industry based on technology, but the demand cycle is outside of its control. The long-term guidance is subject to change, and ASML said, “Looking at 2026, we see that our AI customers’ fundamentals remain strong. At the same time, we continue to see increasing uncertainty driven by macroeconomic and geopolitical developments.”

Is ASML a buy?

The Mistral AI deal is a smart move as it gives ASML some direct exposure to a promising AI start-up and leverages its market power into a new revenue stream. The tailwinds from AI are encouraging as well, but near-term expectations are muted as analysts expect essentially flat growth for the second half of the year and just 4% in 2026.

Following the stock’s recent rebound, ASML shares trade at a forward price-to-earnings ratio of around 30 based on current estimates.

That’s pricey for a stock with single-digit revenue growth, but ASML has enough of a competitive advantage to make holding the stock worthwhile.

At this point, getting a small position in ASML makes sense as estimates are low enough over the coming quarters that the company could top expectations, sending the stock higher. Looking out further, if the AI boom continues, ASML will eventually be a winner even if it got off to a slow start.

In the beginning, it was 1981 and bassist Nikki Sixx left London, the glam metal band he’d formed in Hollywood three years earlier, to start a new project with drummer Tommy Lee. Then, they pulled in guitarist Mick Mars, who responded to the duo’s classified ad for a “loud, rude, and aggressive guitar player,” and eventually persuaded singer Vince Neil, a former classmate of Lee’s, to leave his band Rock Candy for Mötley Crüe.

From its start with 1981 debut “Too Fast for Love,” Mötley Crüe lived up to its mismatched epithet, from its diabolical breakout “Shout at the Devil” in 1983 to the late ‘80s with its most commercially successful release, “Dr. Feelgood.”

Addictions, near-death experiences, hiatuses, departures and reunions — Mötley Crüe survived them all. Each step on its musical journey is commemorated on “From the Beginning,” an album that includes the band’s first single “Live Wire” through its most recent track, “Dogs of War,” released 43 years later. The band also revived a Mötley Crüe classic with a newly recorded version of its “Theatre of Pain” ballad “Home Sweet Home,” featuring Dolly Parton, which reentered the charts in 2025 at No. 1, 40 years after the original recording’s release.

“Mötley Crüe and Dolly Parton together is the ultimate clickbait,” says Sixx, with a laugh. He previously played bass on the country legend’s 2023 “Rockstar” album. “I guess it’s part of that wow factor that has been part of the Mötley Crüe fabric for a long time.”

Proceeds from the new recording of “Home Sweet Home” benefit Covenant House, the nonprofit with which the band has partnered for nearly 20 years through its Mötley Crüe Giveback Initiative. Sixx first worked with Covenant House around the publication of his 2007 memoir, “The Heroin Diaries,” and helped develop a music program at the Hollywood center. In October 2024, the band also played a series of intimate club shows, dubbed Höllywood Takeöver, at the Troubadour, the Roxy and Whisky a Go Go in West Hollywood, which helped raise $350,000 for the organization.

“These kids are everything,” says Sixx. “These kids are the future. They might end up changing the world. What if one of these kids can cure cancer and they just didn’t have a shot?”

Playing those smaller shows in 2024, which also included the Underworld in Camden, London, and the Bowery Ballroom in New York City, is the bare-bones sound, much like rehearsals, that Sixx has always loved.

“One of my favorite parts about being in a band is rehearsal,” he says. “There’s nothing like it. It’s raw, just bass, drums, guitar, and vocals off the floor. Then, you add all the bells and whistles as you go along. When we can do things like that, it just reminds me who we are.”

It’s also part of what keeps Lee excited at this stage of the band’s career, which includes its third residency in Las Vegas in 13 years, which kicked off last week and runs through Oct. 3 at the Dolby Live at Park MGM. (A portion of the ticket proceeds from the 10-show residency will benefit the Nevada Partnership for Homeless Youth.)

“I’ve been married to Nikki and Vince for over 44 years,” says Lee. “Like with any marriage, you gotta create ways to make it exciting, to keep it fun, or else you find yourselves at the breakfast table, with your face in the paper saying ‘Pass the butter.’ So Vegas in Dolby Atmos, new music, club shows, crazy videos, Dolly — we’ve always been trying different stuff to make the audience and us go ‘Oh, f— yeah.”

For Mötley Crüe, Las Vegas has nearly become a second home since the band’s first residency at the Joint at the Hard Rock Hotel in 2012 and its “An Intimate Evening in Hell” a year later.

“We’ve got this great body of work that you don’t really realize until you get this far,” says Sixx. “But now, we’re in one of those interesting places where, if we don’t play the hits, we get
s—, and if we do play the hits, we get s—.”

“From the Beginning” is Mötley Crüe’s new compilation album.

(Chris Walter)

Some deeper Crüe cuts worth inclusion in the set include “Stick to Your Guns,” a non-single on “Too Fast for Love,” and a song that the Runaways’ ex-manager, producer Kim Fowley, asked a then-teenaged Sixx to write for Blondie in 1979.

“I was 17 years old, and we recorded that song, and because no record company would sign us, we started our own label and got a distribution deal,” Sixx recalls. “When we finally joint-ventured up with Elektra Records in ’82, they said we needed to take a song off since it made the vinyl sound thinner, so ‘Stick to Your Guns’ got cut, but I’ve always loved that song.”

Sixx recently revealed that Guns N’ Roses once considered covering the early Crüe track.

”Now I get people saying, ‘We want to hear, “Stick to Your Guns,” ’ “ says Sixx, laughing. “There’s like eight people that know that song. That’s a good way to shut down an arena.”

For Lee, there’s something more paternal around the band’s lengthy catalog.

“I know every artist says it, but our songs are like our kids,” he says. “And over the years, they grow up and they develop [their] own personalities and character. Some stay pretty close to home, settle down, and start their own family. Others go out on a Thursday night and come home on Sunday with no shoes and a shaved head, but we love them all the same.”

With every song, Lee says, the band members understand each other more. “We know how to push each other a little further, and hopefully get the greatest out of each other.”

While there’s always room to make new music, Sixx, who has been the band’s chief songwriter since its inception, prefers the pace of releasing singles.

“It’s just a different landscape now,” he says, “so to create one or two ideas, or co-write three is manageable, and it’s also digestible for the fans.”

So many things have changed, and he is also aware of some misconceptions about the band. “The music is Mötley Crüe — Mötley Crüe is not ‘The Dirt,’ ” says Sixx, citing the 2019 film based on the band’s 2001 tell-all memoir. “People have it confused because we were so honest and it became such a part of the fabric of us that they forget about the riff on ‘Kick Start My Heart’ and just remember the hotel that we tried to burn down in Ontario.”

Another misconception, Sixx says, is the band’s split with Mars in 2022. After issuing a statement that Mars had retired from touring due to his ongoing battle with ankylosing spondylitis, the guitarist sued Mötley Crüe in April 2023, alleging that he was forced out of the band and that his bandmates attempted to cut his 25% ownership stake. Guitarist John 5 — who has filled in on lead guitar duties since October 2022, prior to the lawsuit — continues to tour with the band.

“[Mick] came to us and said, health-wise, he couldn’t fulfill his contract, and we let him out of the deal,” recalls Sixx. “Then he sued us because he just said that he can’t tour. We were like, ‘Well, if you can’t tour, you can’t tour.’ I will probably come to that too someday.”

Although there was no final settlement in court between Mars and the band, a Los Angeles judge ruled in 2024 that the band failed to provide documents to Mars in a timely manner and was ordered to pay his legal fees, Loudwire reported. The underlying dispute regarding the band’s business and Mars’ potential ousting went into private arbitration.
The arbitration is still ongoing but in the first phase the arbitrator ruled in favor of the band and against Mars. The arbitration is still ongoing but in the first phase the arbitrator ruled in favor of the band and against Mick.

Mars’ claims around the band’s use of backing tracks were another point of contention and something Sixx has continued defending. He says the band started playing around with audio enhancements in 1985 and cites the “Girls Girls Girls” track “Wild Side” as a “perfect example” with its sequenced guitar parts. “Anything we enhance the shows with, we actually played,” he says. “If there are background vocals with my background vocals, and we have background singers to make it sound more like the record. That does not mean we’re not singing.”

Mars, who is currently working on his second solo album, was contacted by The Times but declined to comment for the story.

Sixx calls Mars’ accusations a “crazy betrayal” to his legacy and to the fans. “Saying he played in a band that didn’t play, it’s a betrayal to the band who saved his life,” adds Sixx. “People say things like, ‘Well, if you guys are really playing, then I need isolated tracks from band rehearsal.’ … It’s ludicrous.”

Another battle the band has found itself in involves Neil’s health problems and the criticism he’s faced following recent performances. Originally scheduled to perform in March and April, Mötley Crüe postponed its Las Vegas shows so the lead singer could undergo an undisclosed medical procedure. “He needed time to heal, and he’s been working really hard,” Sixx says.

“You can tell he’s working up the stamina, and a lot of people are like, ‘Oh, man, he’s not kicking ass like he used to,’ but it takes a lot of courage to have a doctor tell you you will probably never go onstage again and to fight through that. If he’s got some imperfect moments here and there. They’re getting erased as the days go with rehearsal.”

Back in Las Vegas, Lee has looked forward to connecting with fans again, even if those in their teens and 20s were turned on to the band via “The Dirt.”

“Our goal is the same for all: to give them an incredible show,” he says, “to leave it all on the stage.”

Now, more than 40 years into Mötley Crüe, it may have been a patchwork journey of emotions for Sixx, but he wouldn’t change the experience for anything.

“We believe in this band,” he says. “It’s been 44 years. We’ve been in the band longer than we weren’t in the band. We’ve seen everything — everything. I guess that’s why it was a movie.”

In this podcast, Motley Fool analyst Tim Beyers and contributors Travis Hoium and Lou Whiteman discuss:

• AI capex trends.
• Housing price declines.
• KPop Demon Hunters and other Netflix content.

To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. When you’re ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on August 29, 2025.

Travis Hoium: Could AI spending reach $1 trillion by 2030? Motley Fool Money starts now. Welcome to Motley Fool Money. I’m Travis Hoium, joined by Lou Whiteman and Tim Beyers. We’re going to talk today about housing. We’re going to have Lou and Tim cut some of their favorite stocks from a mini portfolio. But let’s start with artificial intelligence. Morgan Stanley recently said that they expect global Data Center spending to increase from $307 billion in 2024 to 920 billion in 2030. Data Center CapEx is driving companies like NVIDIA, Amazon, Alphabet. But they’re not making enough cash to make that investment themselves. Tim, when you see these huge projections, what do you hear, and do we actually have enough cash flow from these companies to spend almost $1 trillion per year on CapEx?

Tim Beyers: We do, and we don’t. Let’s start with the we do. They are committing quarter over quarter, Travis, and these are multiple companies, somewhere between $50 and $100 million every single quarter. That’s extraordinary. I’m sorry. I said million. I meant billion. This is just a few orders of bag which is bigger. This is extraordinary amounts of money. On the one hand, yes, but on the other, this is a market that is completely out of sync. The buildout of hardware is so extreme that the infrastructure to support all that hardware just isn’t in place yet. I know you’ve covered energy quite a bit over the years, Travis, and I don’t see how you don’t get to a point where there is a little bit of slowdown in the hardware buildout, and then you do some catch-up around energy infrastructure, around environmental infrastructure, around city planning, urban planning. How do you get all of this done in a way that actually creates sustainable growth? That doesn’t seem to be part of these projections, and I think that’s one of the flaws.

Travis Hoium: It does seem like the numbers are just we’re going to keep increasing this. Going from the ChatGPT moment, that was in late 2022, to where we are today, there has been a massive amount of growth in AI spending in spending on things like NVIDIA’s chips. But we’re still learning what these business models are too. We talk a lot about chips, but there’s more to it than this, than just spending money on these power-hungry chips. What else are they going to be spending money on?

Lou Whiteman: With all respect to Morgan Stanley, I do think that it’s smart research. But humans, we are terrible at recognizing cycles, recognizing pendulums for being pendulums. I feel like some of this is just taking what we’re doing today and assuming it into the future, and not considering a swing back. We’ll see about the actual number, but we’re going to spend a lot of money. I do think that at some point, Tim mentioned energy, we’re going to have to spend money on ways to be smarter about energy consumption or building out energy, so that’s part of it. I do think we’ve seen all of this hiring, this poaching, maybe a shift from building up this hardware to getting the brains that know how to use it. I wouldn’t be surprised if, at some point, just instead of just pure hardware and all this data center spending, that even if we still spend a significant amount of money, the spending gets spread out in ways that we’re just not seeing right now at the initial buildup.

Travis Hoium: Tim, the way that you’re talking about this reminds me a lot of the late 1990s and the telecom buildout. There was a dual bubble. We talk about the dotcom bubble. That was a dotcom stock bubble, but there was also a telecom bubble, which is basically these companies spending incredible amounts of money to build out the fiber that we still use today. Google bought up a bunch of that dark fiber. That’s one of the reasons that they have as good infrastructure as they have. What you’re saying reminds me a little bit about, you know what? The numbers are just going up so fast. Demand is going up so quick, and we hear this from every AI-related company that we’re just going to keep building and keep building at some point, there has to be a business model behind it. There has to be return on investment. If we’re talking about $1 trillion of investment, you’ve got to have some profits coming from that. Most of these companies aren’t profitable. Is that a good analogy for thinking about it, or is there a big difference in this buildout versus that telecom buildout?

Tim Beyers: You would hope there’s a difference. I don’t know that there’s a difference, and I think there is a genuine fight over the right economic model for AI, particularly any commercial AI. I think you have two ways to fight the portal fight. What I mean by the portal fight is, I think we are getting to a point where the next interface for computing is likely to be a chat interface. It’s likely to be some kind of, hey, ChatGPT, do this thing for me, or search for this thing, or whatever it is. Some chat interface. Now you’re going to have ChatGPT anthropic, companies like that that are native to the business of building up a chat portal. That’s their primary economic engine, and they want to build things that make that chat engine economically viable. Then you have a competing idea, which is the search model, the traditional web model, and then putting on top of that a chat portal, and that is Alphabet. That is Microsoft. That’s even Apple with Siri. Those two ideas are going to compete. There’s going to be a real fight to figure out who wins in that model. There’s going to be lots of trial and error here, Travis, between is it all going to be driven by advertising? Is it going to be driven by data access? Is it going to be driven by new tools to make different kinds of software that run from a chat interface? But those different types of companies converging to fight a battle to win the portal War, I think, is something we’re still in the infant stages of seeing that. It’s barely started. But that’s a big piece of this story that we aren’t talking about yet, but I promise you in the next 18 months, we’re going to be talking about it.

Travis Hoium: I saw somebody compare the moment that we’re in in artificial intelligence to the Motorola Razor moments. That really stuck with me. That was my favorite phone, I think 2005. But that was obsolete two years later.

Lou Whiteman: I love that phone. But this is such an important part of the AI conversation for us as investors to have because, Travis, to your point a lot of fortunes were lost on that infrastructure buildup, but it was still value adding over time. All of this money is being spent. I think it is adding value. There is a there there. This isn’t just crazy spending, but if history is a guide, that does not translate to every one of these investments will be a winner. As Tim says, there will be a period of figuring out who’s the winners, who’s the losers. I think there could be a lot of winners that aren’t spending the money, just using AI. Just to use one example, MongoDB was up 30% post earnings today on a huge surge of customers attributed to AI. There are going to be a ton of winners. They’re going to be losers, and we’re just so early. If nothing else, you just don’t put all your eggs in one basket here as an investor.

Tim Beyers: Can I add something there, Travis? Just quickly. One of the things that’s common about that. Now, we can’t be sure that MongoDB is going to be a durable winner here. But one of the things that’s true at least today about that MongoDB result is that they sit in one of the categories that historically, over time, you were likening it back to the dotcom bubble, the telecom bubble, the things that did endure from those periods, at least over time, it took some time to wash away all of the excess. But the companies that didn’t go away had real picks and shovels that they could rely on and build upon for the revolution to come. MongoDB is in that space. They’re not the only ones. If we’re an investor that’s looking to profit from the time that we’re in and the excess that we’re in, please, for the love of God, don’t just look at NVIDIA. Look for the picks and shovels. MongoDB might be one. We can’t say for sure that they will be, but they might be one. Any company that is in successful data management is one to at least consider.

Travis Hoium: One of the problems with the telecom buildout was the debt that those companies ended up taking on that increased their risk of their business. Right now, we have Amazon, Microsoft, Alphabet, and Meta generating almost $500 billion in operating cash flow. They’re spending about 365 on CapEx. That’s a projection for this year. They’re using almost all of their operating cash flow on CapEx, in other words. Are we going to get to a point where they’re going to be going into debt to build out more AI solutions?

Tim Beyers: They might, but they certainly have the cash flow to service that debt. You could see it. I’ll make a reckless prediction on this, Travis, you won’t see that. You will see a relentless focus on efficiency first because there is a software side of the AI equation that we haven’t figured out yet. Right now, most of these models are very dumb. They use a lot of tokens. They just burn through all kinds of energy. Almost indiscriminately, that can’t last. There is real engineering work that is happening and will continue to happen to make models, tools far more efficient. I expect, Travis, that you’re going to see a lot of focus on that at the labs at AWS and Google Cloud Platform, and at Microsoft. I just don’t see how they get around that because ultimately, those companies want to see more software built. If you want to build more software, you need better tools, and there just is no way to get around the need for clever, efficient software engineering. That’s just common.

Travis Hoium: Lou, what’s the big picture here?

Lou Whiteman: The big picture I’m watching, we’re talking about all this spending, and, arguably, AI spending is keeping the whole economy afloat right now. I think that’s a little bit of hyperbole, but not too much. The economist, venture capitalist, nature hiker, Paul Hodorowski, great guy. He put out something last month that was really interesting. AI spending is about 1.2% of GDP. That’s higher than it was back in the telecom boom, higher than the Internet. You have to go back to the 1880s, Travis, with railroads to find a time when one sector had that large of a role. At a time when we’re talking about Tara, so the consumer looks pressured, is AI spending just the only thing keeping us afloat? If so, and some of these pressures do build or what could that mean? I can’t answer those questions, but it’s just a broader investor. Those are the things that I don’t know that keep me up at night, but those are the things I’m really watching.

Travis Hoium: We could talk about this all day, and I’m sure this will be a continuing topic, but we do need to take a quick break. When we come back, we’re going to talk about housing prices and the trends that we’re seeing there. You’re listening to Motley Fool Money.

Welcome back to Motley Fool Money. We got a reading from the Case-Shiller Index this week for July. This measures the value of home prices throughout the country, and there’s regions all over the country. Housing is always a regional dynamic. But we are seeing declines in home prices, especially in some of the hotter areas like Florida. Housing is the biggest asset for most Americans. Tim, what should we take away from the potential that home values are going down, not a lot, but at least a little bit throughout the country?

Tim Beyers: It’s healthy. I look at this, Travis, and to me, it feels like a very healthy reset because we badly need more supply in this country. We just don’t have enough, and we haven’t had enough homes for quite a long period of time. When you inject supply into the market, you may see a little bit of pressure on pricing. Pricing comes down a little bit if demand just keeps going, unrelenting, then prices go way up. As supply comes into the market, prices go down a little bit. This feels like exactly what we need right now. I’m very happy to see it. Now, what I’d be looking for is what homes are we talking about here? Are we getting more planned communities? Are we getting more urban housing? I, in particular, think a bit of urban investment is probably the right thing.

Tim Beyers: Because that has economic knock on effects, not that I don’t, like, hey, I live in a suburb. Suburban investment is great, but urban investment where there’s a lot of businesses, there’s a lot of concentrated economic activity. If you get some of this housing influx, new supply, Travis, then I think you may have some knock on effects that are very good for the US economy and very good for consumer facing businesses. I’m hopeful here, but I might be a little bit naive.

Travis Hoium: What do you think, Lou?

Lou Whiteman: I think healthy is a good word. I don’t want to read too much into this. I think this is a sign of just things are getting back to normal. We had a huge price shock. Housing slowed dramatically as we saw rates go up and just we weren’t ready for it. I think what we’re seeing in this data is buyers and sellers returning to the market. A lot of that added supply are just people who have been sitting on their home and are just now saying, we just have to suck it up and sell.

Tim Beyers: That’s because housing is a very sticky thing. If you buy a house and the interest rate goes up, you go, I could double my mortgage payment by moving to a similar home, but that doesn’t make any sense. It is a strange business.

Lou Whiteman: Well, here’s the thing, too, that is interesting, I think, because there’s a lot of macro headwinds that are new supply. Homebuilders are under a lot of pressure in a lot of different ways now between labor, raw materials, all that. I said if we’re just finally adjusting to the rate hikes, there’s a lot of talk now of rates coming back down. I don’t know. The conventional wisdom is that with juice sales, but does that set unrealistic expectations? Does that actually slow sales temporarily? Because we’re just getting used to the status quo, we’re changing again. Look, whatever the Fed does, I think everything going on in the world, all signs are the longer term rates and the mortgages are tied to the 10 year. I don’t know if a Fed rate cut really moves the 10 year and moves the mortgage rate the way, in Econ 101, we were told. If those headlines are there and people aren’t seeing the mortgage adjustment, I have no confidence that this continues. I think there could be another different shock right around the corner, and then we’ll have to adjust to that.

Travis Hoium: For perspective on the 10 year, the 10-year yield has not changed basically since election day. It’s basically flat. I think there has been two rate cuts and another one rumored for September. The other thing I want to bring in here, and this comes down to some of the unemployment numbers that we’ve seen recently, and the Fed talked about this in their Jackson Hole speeches that part of the issue with the headline number, the number of jobs added or not added in the recent revisions, was that there’s just fewer people in the labor market. That could help housing prices, but that’s the other side of the supply and demand. Tim, is that a piece of it that there’s just fewer buyers in the market than there used to be, partly because of less immigration?

Tim Beyers: That could be. I don’t know, but I think Lou made an important point, so I want to double underline it here. This is very complicated. There are a lot of moving parts. The unemployment numbers are going to be important here. We have continued to see layoffs, Travis. I think the thing that I don’t want and I hope I’m not just taking out of context what you were saying here, Lou. But the way I think about it is that if there’s artificial stimulus that comes in at the wrong time, just when we’re seeing a healthy sign come into the market, if you muck with that with more artificial stimulus, let’s say, a poorly timed rate cut, you start to lose some of the benefits you would get by seeing the market return to health. I want the market to just be healthy.

Lou Whiteman: Bottom line is, as an investor, housing looks like even a bigger long term trend to me than AI, but it scares me right now. I don’t know how soon that comes.

Travis Hoium: Well, next up, we’re going to get to a few stocks that we like or maybe don’t like in our game called Cut Down Day, you’re listening to Motley Fool Money.

Welcome back to Motley Fool Money. The NFL has just completed. It’s cutdown day. Roster has gotten down to 53 players. Today’s game that we’re going to play is a little bit similar. I’m going to give Lou and Tim three stock portfolios, just three stocks in the portfolio. We’re going to hopefully get through all four of these. They’re going to have to cut one of their favorite stocks or Foolish favorite stocks. Put on your best Dick for Mal hat and shed some tears for some of the stocks that you probably love. The first portfolio is Foolish favorites. Tim, I want to start with you because I know that you have a long history with a lot of these companies. Netflix, Amazon, and NVIDIA, if you own all three and you’d have to cut one from your portfolio, which one gets the boot?

Tim Beyers: It’s going to be very unpopular.

Travis Hoium: Oh, no.

Tim Beyers: It’s going to be NVIDIA. NVIDIA has got to go. I’m sorry, NVIDIA. I’m sorry, Jensens. The reason NVIDIA’s got to go is because this is a business that is highly cyclical. It has been an absolute stone cold winner, and it could continue to be a stone cold winner. But for me, one of the ways that I practice portfolio management, Travis, is I don’t want to sell everything off of a stock. But let’s say, in this particular case, I’m selling, 75% of my NVIDIA, and I’m redeploying some of that capital. If I have to sell all of it, I will, because what I want to do is always keep moving forward. In a portfolio, sometimes you let go of those darlings in order to keep building and moving forward. In this case, you know what? You’ve been great NVIDIA, but your time has come. Got to give a rookie a shot.

Travis Hoium: All right, Lou. Which one Netflix, Amazon or NVIDIA?

Lou Whiteman: I think Tim has the right answer here. But just to have fun, I do want to give a shout to cutting Amazon. Again, I’m glad we don’t actually have to do these. But look, Amazon, their AI performance to date, hasn’t matched the Cloud. We’re not seeing the same, oh, my gosh, growth we’ve seen elsewhere. I think Microsoft and even Google has a better portal to the customer in a lot of ways, which I don’t know. Also, you do have a fantastic retail business, but it’s a retail business. The divorce with UPS means they weren’t giving their easy deliveries to UPS guys. They were giving the ones that were hard for the internal, so I think there’s going to be some cost pressure on the internal logistics. Look, great company, but I do think they could come under pressure in a bunch of different ways up ahead.

Travis Hoium: But Netflix is the stock that you both want to keep. I think that’s interesting, given Netflix is actually losing time spent to YouTube. Why is that one, Tim, the one that is the winner out of these three?

Tim Beyers: Because I think it’s a two horse race between Netflix and YouTube.

Travis Hoium: You don’t think Disney stands a chance? I say that because sports is really the only uncaptured territory in streaming.

Tim Beyers: You know what? Guess what Netflix just did. They wrote a new deal, and this time, they picked off two things from Major League Baseball that are events that are going to capture a global audience. They’re going to have the world baseball classic between the US and Japan, and they’re going to have the home run derby. For the all star weekend. They’re going to under commit on capital and get in, the likely outcome is you’re going to get some rabid fans who are going to show up for just these things, and they don’t have to overcommit on a giant contract to be the exclusive home of Major League Baseball. They’re very smart about this, Travis. They are really good users of capital. I’ll just remind everybody, this is still the only global TV network that across the world has a direct relationship with every single one of its subscribers. It’s the only one.

Lou Whiteman: I just add, of these three, and again, this is a best of show. These are all, top companies. Netflix, to me, feels the most stable in their most important market in terms of volatility.

Tim Beyers: The cash flows would support that, by the way.

Travis Hoium: I guess there’s no real argument for me I guess Netflix would probably be Number 1 for me, as well. Let’s do Portfolio Number 2. That is the Hidden Gems. These have all been phenomenal performers in Hidden Gems. Tesla, Shopify, and Meta Platforms, formerly Facebook. I still think they should change their name back to Facebook or maybe just call themselves Instagram. Lou, which one of these three would you cut from your portfolio?

Lou Whiteman: Again, this is hard. I have to go with Tesla just on the core business here, because, sometimes I feel like I like Tesla’s automotive business more than Elon Musk.

Travis Hoium: It still don’t have a roadster.

Lou Whiteman: No. Honestly, they just need someone from Detroit to come in and just Detroitify it just a tiny bit. But there are questions about that business. There is still a great long term future story to be had with automotives and out so I don’t want to be too hard on it, but I look at Shopify. I look at them just beginning to conquer all worlds, and I see a lot of potential from there. Meta, Zuck, I love you. I can’t quite always figure out what Zuckerberg’s doing, but it works, and they have a case printing machine, which I am just going to bend the knee and be in awe of. Tesla, to me, is the one that I think I can ask the most questions about. Again, in a best to show, were really fascinating companies, they’re the one that I lean to.

Travis Hoium: What about you, Tim?

Tim Beyers: I’ll give you one number, and this will describe why I’m saying what I’m about to say. Nine, Mark Zuckerberg is giving out nine figure packages to AI engineers. No thank you. You’re out. As soon as you start going to $100 million packages to try to get to AI super intelligence, when there’s still so much we don’t know, no thanks. None of this makes very much sense to me. Now, to be fair, they generate a ton of cash. It’s not like they can’t do it. They can do it. But they are going to dilute investors on the way to this. I think this smacks of more desperation than strategy. See you.

Travis Hoium: Do you have the same criticism for Alphabet? Because Alphabet bought Character.AI basically to reacquire one person, the person who invented the [inaudible] this is not unique in Silicon Valley. Especially today.

Tim Beyers: A hundred percent, Travis. You could level this criticism at lots of different companies at lots of different times. Especially the Silicon Valley companies. Alphabet absolutely deserves criticism for that. There’s no question. Now, would I rather have Alphabet than I would Meta? Yes, I would. Because I feel like the data advantage that Alphabet has is extraordinary. It is also global. It is significant, and you can build a lot once you have, so much search data, so much geographic data. They just have a massive data mote that I think they can build off of. But, no, they do not escape criticism. I think it’s a fair point, Travis.

Travis Hoium: The spending spree will probably continue at least as long as the market is giving these multiples for anybody that has some AI story. Let’s go to our Rule Breaker stocks. This is three popular and very high performing Rule Breakers.

Travis Hoium: MercadoLibre, Intuitive Surgical, and Chipotle. Tim, out of those three, which one gets cut?

Tim Beyers: Really hurts me to say this. This is very painful. I have to say Chipotle, which just kills me because I love a Chipotle burrito. But at this moment in time, I think that Chipotle is still figuring out the next phase of its growth, and I’ll be back when you figure out the next phase of your growth. I’ll be back. But robot surgery is only going to grow more important over time. Mercado Libre they’ve barely tapped the opportunity they have across Latin America. Chipotle burritos are amazing. I will continue to eat them, and I will be back when Chipotle figures out their next phase.

Travis Hoium: If you want to hear a painful story about Chipotle, I sold my shares in 2008. That is painful. That was a mistake selling, which anybody who’s invested for a long time, your worst mistakes are usually your sales, not the stocks that you necessarily miss. Lou, Mercado Libre, Intuitive Surgical or Chipotle, who gets got from your portfolio?

Lou Whiteman: I really wanted to find something else, but Tim’s right on this one. Just to underline a couple more things. Mercado Libre, in some ways, is a consumer business, but not in the same way. They’re just, by the nature of the industry, there’s so much more choice. It’s so much hard to fuel growth in a restaurant business versus the other two. The other two, it’s not as simple as just keep doing what you’re doing, and the business will come, but especially on Intuitive, it feels that way. Like Tim said, Wall Street pays for growth. Wall Street does not pay for just, hey, you’re a good performer. Just continue what you’re doing. I think they may be able to answer the question. It’s almost a running joke. It’s like the Apple car and breakfast at Chipotle. Maybe they’ll get there. Maybe it’ll happen, but I do think that their path forward from here is harder than the other two.

Tim Beyers: Having said that, Travis, like super quickly, if the Chipotlanes take off across that network, look out. If volumes across each unit, like if Chipotle materially increases the volume, they can do per store by virtue of those drive-through Chipotlanes, look out, man. There could be some real winds there, but we’re not seeing that yet.

Travis Hoium: Yeah, that’s basically the only way that I use Chipotle today. I don’t want to get the kids out of the car. We’re going through that Chipotle lane, and everybody’s going to have their food finished by the time we get home. Final group of stocks, I love them all, but they all make me a little nervous for one reason or another. Exxon, Palantir and Arrow Virment Lou, which one of those three is cut today?

Lou Whiteman: I’m going to invert the game here and say the one that I’m not going to cut is Exxon.

Tim Beyers: The price doesn’t make you nervous.

Lou Whiteman: Valuation all over the place here, but just Exxon’s ability. I’m an owner of this one, and I keep saying, oh, they can’t do it again, and yet they do. I’m going to give the benefit of the doubt, given their ability, not just to add new customers, but they have done such a great job of continuously just layering on new products from tasers to body cams to software to now drones and cameras. You got to pick someone. I believe in them to continue. Arrow Virment, I think, could have a really tough time over the next few years, but I love the long-term potential, so I’m not going to cut them. Palantir, I love the technology. But I’m an old school government guy, and all of these companies have government ties. Palantir is still over 50% government. I know the way government allocation works. There is no way you can justify that valuation of the government, so they have to really just grow that commercial like nobody’s business. I think they have it in them, but I am guessing. Just like Netflix, just like Amazon, this really looks like a company where both things can be true. It’s a big long-term winner, and there’s massive drops along the way. I’m going to say goodbye to Palantir here.

Travis Hoium: Tim.

Tim Beyers: Same. I’m not sure. I can’t say it better than that. I will only add that we should consider, in my opinion, Palantir a deeply cyclical business, and it trades like it’s not a cyclical business. And that, I think, should make investors nervous.

Travis Hoium: Well, some very interesting picks from all of you and some great insights on at least why we should be thinking about valuation and growth for some of these companies. Next up, we are going to get to stocks on our radar. You’re listening to Motley Fool Money.

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Travis Hoium: Welcome back to Motley Fool 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 stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards, and it’s not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. We do need to touch on the hottest movie of the week. That is KPOp Demon Hunters, Lou, and Tim. Did either of you see this, Lou?

Lou Whiteman: I didn’t know about it till you asked. [LAUGHTER]

Travis Hoium: Apparently not the target demographic for this movie. But what’s unique about this and what I think is interesting for our investment discussion is, this is a movie made by Sony that ended up on Netflix and became just an absolute hit. I can’t avoid it with my kids. We have not watched it, but it pops up every single time we open up Netflix, and now it ended up in theaters, and it’s been a smash hit in theaters. I had no idea it was coming, except for multiple parents brought it up over the weekend. Are you seeing KPOp Demon Hunters? Tim, is this one is this a new model for the industry? And two, I think it’s interesting that no one saw this coming, including Netflix. It seems like they’re throwing content at the wall, and they don’t know what’s gonna hit. But every once in a while, they hit KPOp Demon Hunters or Squid Game. Is that the strategy for them?

Tim Beyers: Well, it is. The strategy for Netflix is to build a long tail. The longer the tail is, the more opportunity you have to get unexpected hits. And the thing that really makes Netflix sing and what drives that cash flow is you have a hit that goes across multiple territories. Netflix is not. They are the opposite of the max strategy, where you’re going to invest in a very big franchise name, and you’re going to have to put a lot of money behind that franchise name, and then you hope that it delivers just huge returns. Netflix does the exact opposite of that. Lots of seeds, and then something grows into just this giant, beautiful flower that you just can’t help but admire it. We’ve seen this over and over and over again. The Queen’s Gambit did this, Squid Game did this. Wednesday did this. There are some others that are multi-territory hits that are on a smaller scale. Well, I’ll recommend it to you, Travis, Department Q. Great. There’s little things like that. It is a deliberate strategy. It’s going to keep happening. It’s one of the reasons why we should believe in.

Travis Hoium: Lou, do theaters matter and does the order matter theaters first or streaming first?

Lou Whiteman: I don’t think the order matters anymore. I think we’ve evolved to a point where it’s a very different experience. One is more of a communal, and one is more just kind of at home. I think that the same property can work depending on what you’re trying to accomplish. It depends on the group, but more and more, I don’t think it matters. It’s just you put your assets in the ways where it generates money, and it all works out in the end.

Travis Hoium: We’re going to end with stocks on our radar, and I’m going to play the role of Dan Boyd today. Tim, what are you bringing to us for our radar stocks?

Tim Beyers: I’m bringing you Warby Parker. The glasses maker that originally made for selling glasses online, you could get a big package in the mail. You could try on several sets. You use your computer camera to check the fit and check your prescription. They have since moved dramatically from that, Travis. Now they have just under 300 stores across the country. Those stores are highly profitable. Over the trailing 12 months, even when you strip out the stock-based compensation, they’re still generating free cash flow. This is a business that’s getting more and more efficient over time. I’ll give you one stat on this to highlight that. In the most recent quarter, revenue up 13.9%, operating expenses up 3.3%. This is a business that’s getting better and better and better, and I think it’s one for the future. Look out. We’re seeing clearly with Warby Parker.

Travis Hoium: Lou, what are you bringing to radar stocks today?

Lou Whiteman: I’m watching CSX, the Railroad and only watching. The stocks are about 10% down this week, it seems, because no one wants to buy them. CSX’s primary rival, Norfolk Southern. They are going to be acquired by Union Pacific. That puts CSX in a really tough position. And conventional wisdom is that they would get bought by Burlington Northern. However, Berkshire Hathaway, and this does sound like a soap opera, I know. But Berkshire Hathaway, which owns Burlington Northern, Warren Buffett says, no, thank you. I don’t want to buy another railroad. Canadian Pacific said no, too. This is a mass guy, and the market’s reaction to sell off CSX, makes sense. But this story is far from over. For one, we don’t even know if that deal will get through. It’s possible regulators will carve out rules that make it interesting for everyone. I’m not ready to jump in here, but I feel like there might be an opportunity if the market overreacts to their seemingly getting left at the altar. So one to watch.

Travis Hoium: As much as I like these transportation stocks, Lou, Warby Parker, I think is interesting. The deal with Target, we’ll see if that gives them a little bit more legs, a little bit more growth. I think it’s interesting that these DTC companies making these retail partnerships. I don’t know if they all win, but if they can, they can get a little bit more exposure; it could be a big win for them. For Lou Whiteman and Tim Beyers, thanks for joining me today and our production magician Bart Shannon and the entire Motley Fool team, I am Travis Hoium. Thanks for listening to Motley Fool Money. We’ll see you tomorrow.

The Motley Fool just updated its report on the 10 largest consumer staple companies. You probably know every name on the list, which includes retail giants like Walmart (NYSE: WMT), product makers like Procter & Gamble (NYSE: PG), and tobacco companies like Philip Morris International (NYSE: PM). Also on that list is a Dividend King food and beverage company that has a historically high yield. Here’s why it could be the best opportunity for investors today.

What does PepsiCo do?

To get right to the crux of the topic, PepsiCo (PEP 1.12%) is the company in question. It sits at No. 7 on the list of the largest consumer staple companies, with a market cap of around $200 billion. It is one of three beverage makers on the list, the other two being Coca-Cola (KO 0.94%) at No. 4 and Anheuser-Busch InBev (NYSE: BUD) at No. 10.

Image source: Getty Images.

Unlike those other two, however, PepsiCo’s business extends well beyond beverages. It also has leading positions in the salty snack (Frito-Lay) and packaged food (Quaker Oats) segments of the sector. It is one of the most diversified companies on the top-10 list. Only Unilever (NYSE: UL), which makes household products and food, has a similar degree of diversification.

PepsiCo, meanwhile, stands toe to toe with every company on the list with regard to name recognition. For more direct peers, those that manage brands and are not retailers, it can compete equally on distribution, marketing, and product development. And, like all the other names on the list, PepsiCo is large enough to act as an industry consolidator, buying smaller companies to round out its brand portfolio and keep up with consumers’ buying habits.

The proof of the business’s strength and resilience is best highlighted by the fact that PepsiCo is a Dividend King. It has increased its dividend annually for 53 consecutive years, which is not something a company can achieve if it doesn’t have a strong business model that gets executed well in both good times and bad. For reference, other Dividend Kings on the list include Walmart, Coca-Cola, and Procter & Gamble.

WMT data by YCharts.

This is not a good time for PepsiCo 

Among the sub-grouping of large consumer staples companies that are also Dividend Kings, PepsiCo has been the laggard in recent years. To put a number on that, PepsiCo’s 2.1% organic sales growth in the second quarter was less than half the 5% growth of Coca-Cola, its closest peer. No wonder PepsiCo’s stock is down more than 20% from its 2023 highs, the worst result from the Dividend Kings grouping. That also puts PepsiCo into its own personal bear market.

However, the market’s negative view of PepsiCo could be an opportunity for long-term dividend investors. For starters, history suggests that PepsiCo will muddle through this rough patch, as it has done many times before. Second, the company is already making moves to improve performance, including buying a Mexican-American food maker and a probiotic beverage company. Third, falling share price has pushed its dividend yield up to 3.8%, which is toward the high end of the stock’s historical yield range.

That last point suggests that PepsiCo stock is cheap right now. This view is backed up by the fact that the company’s price-to-sales and price-to-book-value ratios are both well below their five-year averages. The company’s price-to-earnings ratio is sitting around the longer-term average. This is an opportunity if you think in decades and not days.

The time to jump is now

The interesting thing here is that PepsiCo is actually the best-performing stock on the top 10 list over the past three months. It seems investors are beginning to recognize the potential. But given how far the stock has fallen, it is still flying under the radar a bit. If you like owning Dividend Kings with reliable businesses, PepsiCo can still be an attractive long-term investment to add to your portfolio… if you act quickly.

It’s no secret that The Motley Fool admires, respects, esteems, and appreciates Warren Buffett and what he’s done for investors. Buffett started investing before he was a teenager and is now worth an estimated $150 billion. He’s generous with his investing advice — and his fortune — and it’s easy to see why Fools love him.

Buffett turns 95 today! That’s a birthday worth celebrating, and below we’ve done just that with Motley Fool contributing analysts and other employees chiming in. Happy Birthday, Mr. Buffett, and Fool on!

Image source: The Motley Fool.

Royston Yang: Buffett was an inspiration in changing how I thought about investing and its process. Previously I was running around the stock market like a headless chicken, not knowing why I was buying a certain stock. He taught me to view stocks as being part of a business and that its share price will increase in line with improvements in the business. It was like a light bulb turned on for me and I embraced value investing there and then, and I have not looked back. Happy Birthday to the Oracle of Omaha and thank you for being such an inspiration and for helping me to achieve success in my personal investments.

Adam Spatacco: One of my college professors quoted Buffett in class with the whole “be greedy when others are fearful, and fearful when others are greedy” mantra. That always stuck with me, totally changed how I viewed approaching stocks — especially when there’s a lot of hype behind certain names or themes. It’s definitely a tool I’ve used over the years when building high-conviction positions or trimming exposure to certain stocks, regardless of what everyone else is doing/whatever the consensus idea is.

Scott Levine: In a society that often celebrates excess, Warren Buffett’s lifestyle is a valuable lesson in the wisdom of living within our means. One of the most successful investors who has amassed a considerable fortune, Buffett lives in the same modest house that he’s occupied for decades and drives an unassuming car. Complement this with his dedication to philanthropy and it’s clear that Warren Buffett is someone people should admire for more than his investing prowess.

Stefon Walters: In the beginning of my investing journey, I looked for any “secrets” that could make me a good investor. Warren Buffett showed me that there’s no secret sauce to being a good investor, it takes patience and understanding the true power of compound interest. His timeless advice continues to guide my investing approach to the day.

Dan Caplinger: Berkshire Hathaway was one of the first stocks I bought in my portfolio, and it is now by far my largest position. It’s the only company whose annual shareholder meeting I have attended in person. It’s by far the company most aligned with my values as an investor. In an age when companies increasingly act against the best interests of ordinary shareholders, Warren Buffett has built a shining counterexample in Berkshire. That will be his biggest legacy long after he shuffles off this mortal coil.

Will Healy: Aside from Warren Buffett’s investing knowledge, his focus on integrity really stuck with me, particularly when I heard him speak about that at a Berkshire Hathaway shareholder meeting. His lesson that reputations take 20 years to build and five minutes to ruin should be something we all keep in mind in investing and in life. Happy Birthday, Warren, and thank you for all you have done!

Anders Bylund: From his timeless investment principles to his incredible philanthropic commitments, Warren Buffett keeps proving that true wealth isn’t just about money — it’s about the positive impact you leave on the world. Much like his friend, the late John Bogle, Buffett’s greatest legacy might just be the way he empowered several generations of everyday investors. It’s a story of wisdom shared with integrity and patience. Time in the market is the surest road to success, and I learned that from Buffett. You can reach the very top of the financial world while always keeping the interests of the average person front and center. What an amazing concept!

Keith Speights: I remember reading Warren Buffett’s op-ed in The New York Times titled “Buy American. I Am.” during the market meltdown in 2008. Buffett’s take was spot-on, and it didn’t take long for him to be proven right. Buffett has been right about a lot of things during his legendary career and has inspired millions of investors — including me. Happy 95th birthday, Mr. Buffett! I hope you celebrate many more.

Kris Eddy: While Buffett is a super-talented stock picker, he also backs owning a low-cost fund tracking the S&P 500 as the best path for many investors. If I ever start to feel bad about not wading into the deep end of picking stocks, I pull myself back to optimism by remembering I am still on a Buffett-approved path of wealth-building action.

Adria Cimino: Warren Buffett not only is a great investor, but he’s also a great writer. His wonderful stories and quotes stick in my mind and guide me as I invest –and as I write about investing! I especially like his comparison of investors paying excessively high valuations to “Cinderella at the ball.”

Joel O’Leary: Buffett helped shape the way I donate my time, money and resources to help others in need. He’s a true leader in generosity, and modeling his attitude has made me richer not just financially, but more importantly, in life. Happy Birthday Mr. Buffett!

Patrick Sanders: Warren Buffett is my investing inspiration. I started off chasing hot, flashy stocks, moving in and out of positions and trying to time the market like a crazy person. Obviously it didn’t work! But then I started learning about Buffett and Berkshire and it resonated. I started looking for value in well-run companies and I gained a lot of appreciation for index funds. Now I’m a much better investor, in large part due to his example. Happy birthday, Mr. Buffett, and thank you!

Image source: Getty Images.

Christine Ferrara Dellamonaca: I love the way Warren Buffett makes investing seem like something that’s for everyone. And his longevity with Berkshire Hathaway and in the investing world at large is just an inspiration. Happy birthday, Mr. Buffett!

Reuben Gregg Brewer: I hate putting any investor on a pedestal, including the Oracle of Omaha. His biggest addition to the world of Wall Street, in my opinion, is probably his assertion that you don’t need anything more than average intelligence to be a good investor. It’s your temperament that will be the bigger determinant of your success. In other words, thank you Mr. Buffett for letting me and the world know that investing isn’t some esoteric science.

Lou Whiteman: Warren Buffett is best known as an investor, and rightfully so. His leadership by example over the past half-century has made myself and countless others wealthier and wiser both by owning Berkshire stock and applying his teachings to our own portfolio. But I am as grateful for Warren Buffett the patriot, a leader who has not been afraid to step into the chaos when needed to support markets and key financial institutions as well as his long-running support of public health. Buffett’s legacy will endure long after the stocks he picked are gone from the Berkshire portfolio thanks to the generations he educated and the lasting reach of the Buffett Foundation. Happy birthday, Mr. Buffett! Here’s to many many more.

Adam Levy: What sets Warren Buffett apart isn’t just how often he’s been right, but how often he’s been wrong and happily told anyone willing to listen. He shares his mistakes in his own folksy manner, often injecting humor into the story. Then he sums up the lessons in a single sentence or two that’s practically impossible to forget. To be as successful as Buffett you need to be willing to make mistakes, but, more importantly, you need to recognize when you’ve made a mistake and why. It doesn’t hurt to start investing at 11 and live until 95 (and beyond) either.

Cory Renauer: In a world obsessed with quick gains, Warren Buffett displays an unwavering commitment to creating value for his shareholders by ignoring market noise and identifying terrific businesses. He could easily get away with claiming his success is due to a superior mind. Instead, he reminds us at every turn that patience and common sense are the only tools we need to generate unlimited wealth with stocks.

Brett Schafer: Warren Buffett will be a timeless member of the investing world not just because of his incredible track record, but due to his humble teaching methods. Simplifying investing and focusing on buying and holding good businesses for the long-term has brought immeasurable value to myself and millions of investors around the world. We can aim to live up to this Buffett mentality and pass on our knowledge to investors of the next generation. Happy birthday to Mr. Buffett!

Selena Maranjian: Warren Buffett has long been one of my heroes, and the more I’ve learned about him, the more I admire him. Having attended many of his annual meetings, I’ve always been impressed with the great respect with which he treats his shareholders — such as by answering dozens of questions for hours. It’s also evident in the care he takes each year to write a very lengthy letter to shareholders that explains all kinds of things — in very down-to-earth language. I recommend Roger Lowenstein’s Buffett, the Making of an American Capitalist to anyone who wants to learn more about Buffett. Long live Warren Buffett — here’s hoping he gets another 95 years!

John Bromels: What I love most about Buffett’s wisdom is its simplicity: Don’t buy an investment you don’t understand. Don’t let emotions rule your decision-making. Buy “wonderful companies at fair prices” rather than “fair companies at wonderful prices.” Very simple advice, but just because it’s simple doesn’t mean that it’s easy! Which is why, more and more each day, I appreciate his willingness to admit his mistakes and encourage others to learn from them. Happy 95th to a true living legend!

Bram Berkowitz: What makes Warren Buffett and Berkshire Hathaway so interesting, in my opinion, is the stocks they buy. Often, they purchase stocks unloved by Wall Street that are truly beaten down. It helps investors like me truly understand what differentiates a value play from a value trap. Additionally, I am impressed by how Buffett is never afraid to buy a stock in a new burgeoning sector, regardless of how old he gets.

Neha Chamaria: Unknown to Warren Buffett, over 8,000 miles away from Omaha, a young girl learned some of her most valuable lessons in investing from the Oracle of Omaha. That girl is me. To pick businesses and not stocks, and invest in only what you understand, are two Buffett principles that have hugely resonated with me and influence every stock I put my money into. Beyond his investing wisdom, Buffett’s simplicity, humility, and modesty of thoughts and lifestyle have truly stayed with me as I believe a true legend’s legacy is shaped as much by modesty as by mastery. Thank you, and happy birthday, Mr. Buffett!

Beth McKenna: I remember hearing or reading about Warren Buffett saying he was a voracious reader. He attributed this attribute as one main element of his investing success. Such great advice — and anyone can increase their reading. Beyond contributing to investing success, being well-read can also enrich one’s life in general. Happy birthday, Mr. Buffett!

Lee Samaha: Warren Buffett doesn’t do position sizing; he doesn’t construct portfolios based on market weighting. He doesn’t employ complex hedging strategies, doesn’t place much value in the capital asset pricing model, and doesn’t invest in the market’s latest hot stock. In fact, he almost lives in a parallel universe to professional money managers, only that in his universe, he consistently outperforms all of them. He truly is the inspiration and a source of confidence for ordinary investors forging their own financial future, and for that, we should all be grateful. 

Shares of Chinese e-commerce and tech giant Alibaba (BABA 12.82%) rallied on Friday, appreciating 13.1% as of 2:28 p.m. ET.

Alibaba reported earnings today, which appeared to encourage investors. While profits actually went down, an acceleration of cloud and artificial intelligence (AI) revenue appear to be the most important data points.

In addition, the Wall Street Journal reported the Chinese tech giant has developed a new AI chip, which could take on importance since China recently issued an order discouraging the use of Nvidia‘s (NVDA -3.38%) H20.

Alibaba is becoming a top Chinese AI company

In its fiscal first quarter, Alibaba grew revenue just 2%, but revenue grew 10% outside of divestitures, which included the Sun Art and Intime businesses. Within that 10%, Alibaba’s domestic e-commerce revenue grew 10%, international e-commerce grew 19%, and the cloud intelligence group accelerated to a 26% growth rate.

On the negative side, profits actually decreased, with adjusted non-GAAP (generally accepted accounting principles) earnings before interest, taxes, depreciation, and amortization (EBITDA) falling 11%. The company put big investments behind its Taobao Instant Commerce initiative, which aims to deliver packages within an hour, as well as associated marketing efforts. An overwhelming majority of Alibaba’s business is still in a brutally competitive Chinese e-commerce industry, and at least in this quarter, we saw that competition in the form of lower margins.

Yet it appears the cloud revenue acceleration was exciting enough, especially as management noted that AI-related cloud revenue grew at a triple-digit rate for the eighth consecutive quarter.

AI enthusiasm may have also been sparked by today’s Wall Street Journal article highlighting Alibaba’s new chipmaking efforts. Alibaba’s prior efforts in this area had focused on application-specific chips, but the WSJ reported Alibaba’s newest chip can achieve a broader range of AI inference tasks. Also embedded in the WSJ article is the fact that. unlike Huawei’s AI chip, Alibaba’s new chip will be software-compatible with Nvidia’s, so developers won’t have to reprogram their entire stack.

Image source: Getty Images.

Alibaba on the rebound?

Alibaba has rebounded strongly off its lows of late 2022, more than doubling since then, but also sits about 63% below its all-time highs from late 2020. The stock trades for just 18 times earnings, which still seems cheap for a tech giant with an AI growth story.

Of course, most Chinese tech giants trade cheaper than their U.S. peers for geopolitical reasons, and Alibaba also has strong competition on the e-commerce side. Nevertheless, for those seeking some China-specific exposure, Alibaba should be on the list, if not near the top.

The biggest company on The Motley Fool’s updated list of the largest utility companies is in the United States. However, it is more than just a regulated electric utility, and that sets it apart from many of its U.S. peers that have made the list of largest utility companies.

And those differences are why NextEra Energy (NEE -0.54%) could be a huge long-term investment opportunity for growth investors, income investors, and (no shock) growth and income investors. Here’s what you need to know.

What does NextEra Energy do?

NextEra Energy is two businesses in one. The core of the company is its regulated electricity operations in Florida. The Sunshine State has long benefited from in-migration, as people seek out warmer weather, lower taxes, and a comfortable retirement. The company’s Florida Power & Light operation is one of the largest regulated utilities in the United States.

Image source: Getty Images.

Being regulated gives NextEra a monopoly in the areas it serves. In exchange for that monopoly, it has to have its rates and capital investment plans approved by the government.

The usual outcome is slow and steady growth over time, as regulators try to balance customer costs, reliability, and investor returns. All in all, this is a solid, slow, and steady growth foundation for NextEra.

Most utility businesses stop there. NextEra, however, has used this foundation to build one of the world’s largest solar and wind power businesses. It is a clean-energy giant, taking advantage of the world’s shift away from power based on dirtier carbon fuels and toward cleaner and renewable sources of energy. This is NextEra’s growth engine and will likely remain so for years to come.

One very big reason is that electricity demand is shifting into high gear. Between 2000 and 2020, demand increased 9%. Between 2020 and 2040, it is expected to expand by as much as 55%.

Driving that will be artificial intelligence and data centers, where demand is expected to increase 300% over a decade. And electric vehicles are expected to push another 9,000% in demand through 2050. All in, electricity is projected to grow from 21% of end power use to 32% of end use by 2050.

NextEra is positioned well on both sides of the equation

What’s exciting about NextEra Energy is that it isn’t just in the right place at the right time in one business. It is in the right place at the right time in two businesses.

Demand increases are going to push utility growth into a higher gear, helping the company’s Florida-based regulated operations. And the broader shift toward clean energy will also be a big boost to the company’s solar and wind operation. In many cases, it isn’t just more environmentally friendly to install clean energy than to build a power plant, it is also quicker and more cost effective.

This is where things start to get interesting. The average U.S. utility has a dividend yield of a little less than 2.7%. NextEra Energy’s yield is roughly 3%. In this respect, it looks like the stock is on sale right now and providing a yield well above the market on top of that.

But NextEra Energy is also growing its business by itself, in addition to outside forces. In the second quarter of 2025, revenue jumped 10% year over year, with earnings rising a little over 9%. That’s pretty impressive for a utility, since they are normally considered boring, slow growth investments.

And there’s likely more to come, highlighting that the clean energy business has 30 gigawatts worth of power projects in its backlog. Six gigawatts of that total are directly tied to technology companies and data centers.

On the dividend front, NextEra has increased its annual payout for over three decades. And the annualized growth rate over the past decade was a huge 10% a year. Management is currently projecting 10% dividend growth through at least 2026. So not only is this a high-yield story and a growth story, but it is also an attractive dividend growth story, too.

NextEra is the biggest utility and a big investment opportunity

If you are a dividend lover, a dividend growth lover, a growth lover, or a value lover, NextEra Energy will probably look attractive to you. That’s a huge amount of investment ground being covered by the world’s largest utility. And it highlights why you might just want to buy this industry giant today to take advantage of what looks like a huge long-term opportunity in the utility sector.