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10 stocks we like better than Wal-Mart
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The author(s) may have a position in any stocks mentioned.
This video was recorded on May 12, 2017.
Chris Hill: Let's get to the stocks on our radar this week. Our man behind the glass, Steve Broido, will hit you with a question. Ron Gross, you're up first, what are you looking at?
Ron Gross: I got a recent Total Income recommendation, Oaktree Capital, [ticker] OAK. They're an investment management firm founded by Howard Marks back in 1995. A really enviable track record. They operate in alternative markets. Nice upside to the stock, I think, and they have a 6.3% dividend yield that looks pretty safe to me, nice and juicy yield there.
Hill: Steve, question about Oaktree Capital?
Steve Broido: How would I describe Oaktree to a friend?
Gross: They manage money for big pension funds, insurance companies, through closed-end funds, open-end funds, and different investment vehicles.
Hill: Seth Jayson, what are you looking at?
Seth Jayson: OK, everyone likes yoga, pilates, working out, going to the gym, doing the SoulCycle kind of thing, or the spin, whatever it is, I'm saying all these names, we're going to get sued. Anyway, the company is Mindbody, [ticker] MB. They provide a cloud-based solution for people in that business to run the businesses, to book the appointments, in addition to providing the software they also have a marketplace that lets you get rid of the appointments that you're not filling, do some marketing, they have a partnership that just came online with Google to help fill these slots. They're not yet profitable, but they're on the cusp and they're growing pretty quickly.
Hill: Steve, question about Mindbody?
Broido: Is there a one-stop shop for this service for all businesses? Hair salons, where you're booking people, does anyone own that space?
Jayson: That's the thing, nobody really does, and these folks are making an attempt at it. There's a lot of smaller and bigger companies that own pieces of it. They're one of the first ones to try and do it all.
Hill: Jason Moser, what are you looking at?
Jason Moser: Looking at Wageworks, [ticker] WAGE. They just reported a pretty good first quarter. This business administers consumer-directed benefit programs like flex health spending accounts and commuter benefits and whatnot. They had a good first quarter, they have a good pipeline of business here coming down the line for the rest of 2017, big contracts with the U.S. government, which never hurts. And they developed some very interesting partnerships with Lyft and Uber to really help stoke some growth in their commuter benefits line of business. Generally speaking, looks like they do a pretty good job at what they do. Pretty healthy margins, profitable, cash flow positive, a lot of reasons to like this business.
Hill: Steve, question about WageWorks?
Broido: It seems like corporations are always trying to spend less on things like employee benefits.
Moser: I think corporations are trying to figure out ways to get their employees to prepare for things like this moreso, and that's why employers will tend to offer these types of programs. I think that's one of the bigger challenges Steve, is getting employees to actually sign up for them and understand how they work.
Hill: Got a stock you want to add to your watch list, Steve?
Broido: I'm going with the yoga one.
Gross: Oh, come on, fixed.
Hill: [laughs] When was the last time you were in a shop like that?
Broido: A few weeks ago, I tried yoga, it was pretty cool. Not a lie. True story.