There are thousands of publicly traded companies whose businesses don't put them much in the public eye. In this segment of the Motley Fool Money radio show, host Chris Hill asks Million Dollar Portfolio's Jason Moser and Matt Argersinger and Supernova and Rule Breakers' David Kretzmann for their suggestions on how to unearth potential investments in those lesser-known stocks.
A full transcript follows the video.
This video was recorded on July 28, 2017.
Chris Hill: Question from Zach Poolin at Saint Anselm College. "I've been going through each sector of the market and adding all of the stocks I see every day to an Excel spreadsheet." That sounds exhausting. "It's very time consuming and I'm sure that I'm missing many stocks that play a crucial role in our future economy. Is there a better way to learn about stocks in each sector? Obviously Apple, Amazon, Facebook and Microsoft are known to many investors, but where do I find the hidden gems that aren't talked about a lot, or publicized in the world?" Great question, and kudos to Zach for being in college and getting started in investing in individual stocks.
Matt Argersinger: Yeah. He's a bit of a stock jock. Kind of like myself in college, so I admire that. I often did that, too. I made lists of companies, ones that I'd heard of, other ones that I would find searching around. The great thing is, you can find companies that are related to companies you might recall on a regular basis. One hack that I like to use, Zach, is I simply go to Google Finance now and then and I'll enter a company, say, Nike, you enter that ticker and scroll down, right below it it will have a long list of related companies, maybe some of that you've heard of like Adidas or Deckers, but maybe other ones that you haven't heard of, Skechers, VF Corp, Li-Ning, which is a Chinese shoe company. So, you can find hidden companies doing a very simple trick like that. Then, that's your beginning search point for more research on those names.
Hill: One of the things I like about that is, there's no discerning among competitors on Google Finance with regard to size. Which is great, because if you're looking for smaller companies, as Zach says, the hidden gems, then you want to know, what are the other companies that are in this space are one-tenth the size of whoever is the market leader?
David Kretzmann: Yeah. And another option similar to what Matt mentioned is, there are a lot of free stock screeners online. We have one at caps.fool.com, a lot of other sites will have them. You can search by market cap, by industry, by revenue growth, all sorts of different factors, and that can be a way to narrow down your search and look through companies and figure out which ones you're interested in following. You can get on going coverage -- I'm not being paid to say this -- at fool.com. We have a lot of writers who will cover these different sectors and companies each quarter and on a regular basis, and that can be a way to get a better understanding of an industry and the companies within that industry over time.
Hill: One other thing I want to add to dovetail off of what David just said is, I find it really helpful that there are all of these niche media outlets for different parts of the investing universe. Earlier in the week, when I was doing some research on Chipotle and their latest quarter, I found a very helpful article on a mainstream publication we're all familiar with, Food Safety News. So, it's just one more benefit to all the options that are out there.
Jason Moser: And I think you really hit the nail on the head there, along with all of these great ideas that David and Matt have. I think it's just keeping that curiosity level always up there, and reading. That's it. Just keep on reading, keep on learning, keep on keeping plugged in. Boy, that stuff comes at you when you're not even looking for it sometimes.
Hill: Let's go to our man behind the glass, Steve Broido. It's not quite time for radar stocks, but Steve is an experienced investor. Two questions for you, Steve. First, do you have a piece of advice for Zach Poolin -- an investing hack, if you will, when it comes to research? And my second question is, what's your favorite obscure publication?
Steve Broido: Favorite obscure publication, I'll start there, I think it's called Broadcast. I get it sent to me from time to time.
Hill: Broadcast and Cable?
Broido: No, it's Streaming Media, that's my favorite. The advice I would give is, find things that you're interested in specifically. If you're a computer gamer, if you're interested in cars, if you're interested in something else, and dig around. Find out who's making the rims for the car that you're buying, find out who's making the parts that go in the computer you just built, the skateboard wheels, whatever it is, dig in. There's usually a public company related.
Hill: That's a great point, particularly as we are a couple months away from the new iPhone unveiling, a nice reminder from Steve that, for all the big-name companies out there that are producing whatever a certain thing is, chances are there are a lot of companies, in some case public companies, that are the supplier to that network. And we've seen that with the iPhone, just to pick one device, where there are some companies that just come in and they're knocking the cover off the ball in terms of their stock performance. Great question from Zach. Keep it up.
Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors. LinkedIn is owned by Microsoft. Chris Hill has no position in any stocks mentioned. David Kretzmann owns shares of Facebook, Nike, and Skechers. Jason Moser owns shares of Apple and Nike. Matthew Argersinger owns shares of Apple. Matthew Argersinger has the following options: long January 2019 $45 calls on Nike and short October 2017 $60 calls on Nike. Steve Broido owns shares of Apple, Facebook, and Facebook. The Motley Fool owns shares of and recommends Apple, Facebook, Nike, and Skechers. The Motley Fool recommends Deckers Outdoor. The Motley Fool has a disclosure policy.