In this segment from the Motley Fool Money radio show, host Chris Hill asks Supernova and Million Dollar Portfolio's Matt Argersinger, Total Income's Ron Gross, and Motley Fool Pro and Options' Jeff Fischer about the companies they have their eyes on, and why: ski resort specialist Vail Resorts (NYSE:MTN), software giant Oracle (NYSE:ORCL), and freight railroad CSX (NASDAQ:CSX).
A full transcript follows the video.
This video was recorded on Sept. 15, 2017.
Chris Hill: Steve will hit you with a really great question, because he's going to be out for a couple of weeks and won't be able to ask any questions. Ron Gross, you're up first, what are you looking at this week?
Ron Gross: Wow, how do I follow that? Vail Resorts, MTN. Skiers will know it for its luxury resorts: Breckenridge, Beaver Creek, Whistler. They recently acquired Stowe. Interesting fact here -- a 2011 law signed by Barack Obama gave ski resorts the ability to add summertime activities, and Vail has been doing that slowly over time to lessen the seasonality of the business. As you can imagine, a ski resort is a very seasonal business. So, they'll be adding zip lines, mountain bikes, golf courses, road courses. That should help growth in terms of revenue. Hopefully, that'll translate to growth in earnings as well. Stock should have some nice upsides. Also pays a 1.8% dividend.
Hill: Steve, question about Vail Resorts?
Steve Broido: Is there an age that you're too old to go skiing? I know the simple answer is no, but I'm not skiing any more. I'm over 40, I'm done, that ship has sailed.
Gross: I think you're more likely to tear something, break something or sprain something once you're 35-plus.
Hill: Jeff Fischer, what are you looking at?
Jeff Fischer: I feel like I should recommend ice cream or something to Steve, but I'm going back to Oracle, because it is down the most in four years this Friday, to end the week. The company's margins are going higher as it sells more cloud software. The shares look inexpensive at this point, and I think the long-term trajectory of the business is perfectly fine.
Hill: The ticker symbol?
Hill: Steve, question about Oracle?
Broido: What does Oracle actually do? I've heard of Oracle for decades now and I feel like I still have no idea what it does.
Fischer: It's one of the largest business enterprise software sellers in the world, Steve. Mainly it sells database software and software that lets you manage your human resources or your analytics or your governments, all those sorts of things and many other things beyond that. So, it's software management.
Gross: That clear it up, Steve?
Fischer: Yeah, sure. [laughs]
Hill: Matt Argersinger, what are you looking at?
Matt Argersinger: I'm pretty bearish on the railroads right now, and I'm particularly bearish on CSX, ticker CSX. It's one of the largest railroads in the world, but it's very dependent on coal, which for all intents and purposes is pretty much a dying commodity. Freight traffic in general is slowing down. Hunter Harrison, who is a very successful manager, railroad CEO for many decades now, he was hired about nine months ago by CSX. Paid $84 million. But apparently he might be stepping down soon because of health problems. He's 73 years old. The stock trades for almost 30 times earnings. So, I would say stay away from CSX.
Hill: Steve, question about CSX?
Broido: Isn't transporting things via train the most efficient way to get things across the country still? Cost per mile, it's almost nothing.
Argersinger: No doubt, it is. But what I'm worried about is the amount of stuff they're going to be able to haul, especially when they're so dependent on commodities and other things where demand is just plunging.
Hill: CSX, Oracle, Vail Resorts. Three very different companies. Steve, you got one you want to add to your watch list?
Broido: I might take a look at Vail Resorts. In the summertime, it sounds like a nice place to be.
Chris Hill has no position in any of the stocks mentioned. Jeff Fischer owns shares of Oracle. Matthew Argersinger has no position in any of the stocks mentioned. Ron Gross has no position in any of the stocks mentioned. Steve Broido has no position in any of the stocks mentioned. The Motley Fool owns shares of Oracle. The Motley Fool recommends CSX and Vail Resorts. The Motley Fool has a disclosure policy.
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