2 Overvalued Stocks

The Motley Fool's "MarketFoolery" takes on two well-known brands and explains why they're overvalued.

Jun 9, 2014 at 5:00PM

On Monday's edition of MarketFoolery, host Chris Hill, Motley Fool One analyst Jason Moser, and Stock Advisor Canada analyst Taylor Muckerman discuss two overvalued stocks. With the stock market where it is, Chris believes that it's a great time to discuss overvalued stocks, and Jason and Taylor both heartily agree. 

Jason pulls out Zillow (NASDAQ:ZG) as his overvalued stock, explaining that the company is a good one but with a bad price. After mentioning that Zillow has worked at building out its identity to line up with its mission, he notes that the company is operating at a loss, and Jason believes that there are a lot of assumptions built into the stock's price. He discusses a potential problem in Zillow's future, the rental market that it could fill out, and what to do with Zillow if you already have it in your portfolio.

Krispy Kreme (NYSE:KKD) is Taylor's overvalued stock -- he might be celebrating National Doughnut Day a bit late this year with his pick. Despite bad earnings in December and a hit last week, Taylor says that Krispy Kreme's margins are improving. However, its partnership with Wal-Mart is giving Taylor pause. Chris notes that the doughnut company has about two-thirds of its stores outside of the United States and he wonders why Krispy Kreme isn't moving along the domestic lines of Dunkin' Brands (NASDAQ:DNKN). While Taylor likes the company, he thinks it needs to pull back a bit.

Protect yourself from overvalued stocks
One way to hedge against overvalued stocks is to have a well-constructed portfolio. Such a portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts have put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

Chris HillJason Moser, and Taylor Muckerman have no position in any stocks mentioned. The Motley Fool recommends and owns shares of Zillow. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information