In this week's installment of Industry Focus: Financials, president of Prudential (NYSE:PRU) retirement Phil Waldeck talks with host Jason Moser and Robert Brokamp, CFP, about the state of retirement in the United States and more. Then Moser and Fool.com contributor Matt Frankel, CFP, dive into DocuSign's (NASDAQ:DOCU) excellent quarter and the future growth potential of the company. Plus, in a brand-new segment, Moser and Frankel discuss the last stock each of them bought in their own portfolios and why. And finally, the pair give listeners the stocks that are at the top of their watch lists. All of this and more on this week's episode.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. A full transcript follows the video.

This video was recorded on Sept. 9, 2019.

Jason Moser: Welcome to Industry Focus, the podcast that dives into a different sector of the stock market each day. It's Monday, September 9th. I'm your host, Jason Moser. On today's Financials show, we're going to take a look at DocuSign's most recent quarter. We've got a look at a new launch here that Matt's going to dig into for us. We've got a new segment we're going to try out this week called "What's the last stock you bought and why?" As always, we'll have a couple of stocks for you to watch. But we begin this week with another installment of "Between Two Fools."

Phil Waldeck is president of Prudential Retirement, a leading provider of defined contribution, defined benefit, nonqualified deferred compensation, plan administration, and institutional investment and risk management services. Recently, Robert Brokamp and I spoke with Phil about the state of retirement in the U.S., potential implications of the SECURE Act, and the role employers like Prudential and The Motley Fool play in strengthening retirement security for generations to come.

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Moser: OK, so, Phil, first things first: Why do you think so many Americans have such a difficult time saving for retirement? The concept is great. Most people, it feels like, are thinking about retirement from the first day they get into the workforce. Yet as a whole, we have a really difficult time pulling it off. Why do you think that's the case?

Phil Waldeck: The system works really well for part of America. Generally, it works pretty well for large and medium-sized employers, people who work for large and medium-sized firms. But we know that Americans broadly are financially stressed. Part of the challenge is, the system is voluntary. It requires that people make lots of individual choices, and they make the right choices, to be on track. And it starts with, does your employer have a plan? If you work for a smaller employer, that is less likely. And that means more is on your back to figure it out, make savings via IRAs, etc., as opposed to having an employer that can give you access to a plan, ideally auto enroll you into that plan so you have to make a conscious choice not to save, as opposed to taking lots of active steps to do it and do it right. Having things like payroll deduction helps you stay on course. Otherwise, it's much harder to do ongoing savings. You'd have to do it all yourself. The real world happens, in terms of surprises. People have emergencies, whether it be cars, whether it be hurricanes that we're seeing in the news now, that could put people off course. And then, the complexities of people's lives make it easy to procrastinate, and we often have an optimism bias, which we'll get to later. And it gets harder if you wait.

Moser: I'm glad you mentioned the auto enrollment thing. Generally speaking I'm for people having the choice, they can do one thing or the other. Many times, what we do here at The Fool, we're trying to help people make those good decisions, even if they don't know that they're really good decisions at the time. I feel like that auto enrollment is something that should be standard for every employer. I guess you can't force that on them, but I would love to see more employers adopt that auto enrollment and force the individual to opt out of it. I think a lot of times, it just boils down to people being kind of lazy, right? They don't want to go through the work of enrolling themselves. You've got to do some work to auto-un-enroll yourself. I'd love to see more of that auto enroll.

Waldeck: Absolutely. I think auto enrollment is really a wonderful tool because the individual still has the control. They can opt out. But they're being put on the right path that they'd have to step off of. And it takes an active step not to do the right thing. It makes it a lot easier for people that are busy, and makes it a lot easier for people that may be torn in terms of all the complexity that they're dealing with retirement, help them get on the right path. That's what the autos do with auto enrollment.

Robert Brokamp: Adding onto that, the studies indicate that if you had auto enrollment at your job, the participation rate in the 401(k) is significantly higher. It's something like 80%, 85%, compared to plans where there is no auto enrollment, and the participation rate is like 50%, 60%, something like that. I think part of that is that sometimes, the plans can be complicated, or at least intimidating. You join your new job, you're starting your new job, and then you're asked to sign up for the 401(k) as well as all the other benefits that you have. I'm curious if you have any thoughts on how to simplify and streamline retirement plans and maybe all employee benefits for someone who's starting a job?

Waldeck: I think it starts with having an employer that has a plan and has auto enrollment, as an example. Just to reinforce what you're saying, Rob, if you look at employees that are making between $30,000 and $50,000 a year, they are 16 times more likely to be saving for retirement if they have access to a workplace plan. That is a huge tailwind that can be working for them. So, how do we make it simpler? How do we take advantage of the benefits of the workplace structure? Specifically, it is helpful if you've got an employer that's got a plan, that they have auto enrollment, if that workplace plan has a match, if employees are nudged to higher contribution levels, so, auto enroll at a higher level to get you closer to 10% or so of contributions, and then to move you up the ladder of contributions with an auto-increase every year. So, if you start out at 4%, or 5%, every year, as it goes 6%, 7%, 8%, 9%, until you get to at least 10%. Additionally, make it easy on the investments. Have tools like target date funds or other asset allocation engines that take the complexity out of it. Wherever possible, have a set of defaults that are the right path, where people still have control, but help them get on the right path.

Moser: I like how that streamlines the process for people. You take a lot of the thinking out of it, just do the heavy lifting for them. For someone who's going to be a little bit more active in their retirement plan, someone who maybe keeps up with it a little bit more or wants to know more about the limits and what they can contribute, what are some of the tips that you suggest to individuals who want to save more in their retirement plan?

Waldeck: I think there's some basic fundamentals. Every person should take their full circumstances into account. These are broad comments. But, start early. Don't wait. Let time be on your side. Employees in their 20s, if they can get started early and not delay, they'll have that compounding investment return advantage on their side. Second basic is, contribute at least enough to get to the employer match. Have a plan to ultimately get to 10% or more of your wages going into the plan. Don't get off track, meaning, don't take withdrawals or loans. Have an emergency savings fund that you would build over time so that when real life surprises happen -- cars break down, hurricanes happen, etc. -- you've got the resilience so that you can weather that and keep your retirement plan on track. And then there's other steps associated with being prudent with Social Security. Resist the urge to take it early. There's a whole series of steps that people can take. But I think it begins with getting in the game early and making sure that you are contributing enough and able to stay the course.

Moser: You're absolutely right. Time is your buddy, and you have to get in early. I think in a lot of cases, people don't, because they either didn't really have that financial education early on enough to understand the power of it there. But how often do you see people who feel like they've gotten into it late and they need to figure out a way to play catch-up? That can be a very dangerous path to wander down, because you start making some decisions that maybe aren't necessarily the wisest. How often do you see people who are getting into it late and trying to figure out what they can do to catch up?

Waldeck: Well, it is much easier to take the right steps than it is to recover from the wrong steps. Starting early, way better than trying to catch up later. If you are trying to catch up later, then how can you contribute as much as possible? And how can you take advantage of catch-up contributions, quote-unquote, that older employees are able to contribute a larger amount than they would otherwise, in terms of the maxes they're exposed to? But it also means avoiding some of the other mistakes that could happen outside of the plan. Having a budget, a spending plan, having a buffer for emergency savings, having a game plan on debt. The best approach is to not get into debt in the first place, but to the extent that people have student loans, have a game plan on student loans, and be really cautious when it comes to things like credit card debt.

Brokamp: Earlier in the year, the House of Representatives passed something called the SECURE Act, SECURE standing for Setting Every Community Up for Retirement Enhancement --

Moser: Just rolls right off the tongue. [laughs]

Brokamp: [laughs] It does. So, it very solidly passed the House. The Senate is still sitting on it. Apparently there are a few senators that have some qualms about a few things. But it generally looks promising. I know it's something that you've been paying attention to. Tell us a little bit about your take on the SECURE Act and how it could help people save more for retirement.

Waldeck: I think maybe I'll pose some questions. When was the last time you had legislation that Democrats and Republicans widely agreed on? Super-strong support from both parties? It passed the House, as you mentioned, 417 to 3. A similar bill came out of the Senate Finance Committee 28 to 0. You've got all sorts of constituents from U.S. Chamber of Commerce to AARP behind it. There's a real opportunity to have the best steps forward in terms of retirement legislation in over a decade. And what it does is, it has three basic components. It helps more employers cover more workers to give them access to plans. It helps increase retirement savings. And it helps make the draw-down, the ability to take an account balance and turn it into income that you can use throughout your retirement years, easier.

So, what do I mean by all that? Often, small employers don't offer plans. And they don't offer plans because of costs, because of complexity of administering a plan, or because of concerns about liability, potentially getting sued. What this legislation does is create a pooling effect that enables small employers to come together and have larger employer buying power in terms of efficiency. It takes administrative complexity out of the picture and provides tax credits so that small employers set up plans and take the step of auto enrollment that we talked about earlier. And it also minimizes the fiduciary liability for small employers. So there's a whole series of wins there. That's good for the worker, and that's good for the smaller employer as well.

The second area that I think has potential impact that will be helpful is that auto enrollment currently has a ceiling above which you cannot increase each year, auto escalation. That ceiling will be moved to a higher threshold, which means people could contribute more on an automatic basis. It also has some other minor adjustments for IRA contributions and required distributions out of plans. All that helps get more people in the game. It provides more coverage for longtime part-time employees. People who've been part-time workers for several years can be included in workplace plans.

And then finally, if you build a successful retirement nest egg, and then you're at the cusp of retirement, that too can be complicated. What do you do next? How do you draw the income out of your retirement nest egg? This legislation helps employers and employees by having illustrations that explain what an account balance can turn into, and to make it easier for employers to offer guarantees for income annuities to help those employees draw down their retirement assets but not outlive them, which is a complicated balancing act for an individual to navigate.

Brokamp: I'm on the 401(k) Committee here at The Motley Fool. There are a couple of things I think people need to understand about 401(k)s. First of all, they do cost your employers money. It is a great benefit, and people should be very grateful that they have it. But when we at The Motley Fool started looking at our 401(k) -- this is many, many years ago, we were a much smaller company, and there were some of the bigger providers that wouldn't even look at us because we were such a small company. So the ability to band with other small companies and be basically a bigger buyer in the marketplace is a huge advantage.

Waldeck: That's absolutely right on. That pooling effect is helpful both in terms of costs, but also in terms of complexity for the employer. You get smaller and smaller employers, benefits in general are a complicated landscape that generally, those employers would like to spend less time on.

Brokamp: One aspect of it that I think is drawing a little bit of... if not controversy, just, people want to make sure things are going to be OK, and that is, the act will allow more annuities to be in 401(k)s. And annuities have a mixed reputation. I personally think the plain vanilla annuity, where you buy a lifetime income, I think it makes a lot of sense. But there are obviously a lot of more complicated annuities, higher-cost annuities, and there's some concern that a lot of those will end up in 401(k)s. What could you say to allay the concerns that some people have that 401(k)s will be filled with a lot of products that are inappropriate for a lot of people?

Waldeck: I think there's several dynamics here. First, what problem are we trying to solve? We're trying to help people by pooling longevity. I have the risk of living longer. Half of people will live more than the average expectation, so I have the risk -- if my longevity expectation is 85, half of us will live more than 85, as an example. So how do you make sure that people don't run out of money at the end but also not get exposed to inappropriate or improperly priced products? I think we do have a need to understand how to draw account balances down and how to protect against longevity risk.

What I think will happen with this legislation is, we'll have appropriate regulation, we will have institutional buyers who will expect the market to provide them appropriate products. This isn't a market that's going to transform overnight. Over time, a market will emerge in which there are institutionally priced plan sponsors that are bringing thousands of participants together, as opposed to individual relationships. I think you will see a competitive market emerge, just like it has for target date funds, just like it has for other aspects of the retirement system. But it'll be a combination of providers that are expert at this, institutionally priced, meaning cheaper than retail pricing, that will emerge, and with regulatory oversight.

Moser: I'm going to piggyback on this innovation topic for a moment. The pooling effect, I think, is great. I think we see more and more small businesses coming into play. We're going to see more innovative approaches, new ideas, things that will make our retirement security landscape here in the United States even better. What role do you see employers play today in strengthening our retirement security landscape, and more so, what are some of the innovative approaches that you've seen from these employers in the marketplace today?

Waldeck: I'll start with your original question and then go to the innovation that we started the discussion, which is about how hard it is for individuals. If you just use the analogy, back to getting all these steps right to be on track for retirement, it would be really complicated for me to fly from New York to Los Angeles. But that system works pretty well. Despite complaints we might have about airline travel, I don't have to figure out how to get a plane and navigate from here to LA. But the retirement system requires that you take lots of individual steps to get it right. If aircraft travel can happen with such safety and such predictability, we should be able to get our retirement system to function way better.

"Way better" means having it happen at the workplace. Employees trust their employers. There's a recent survey out there, the Edelman Trust Barometer, that identifies one's own employer has the most trusted institution in the country. More than the media, more than government. You pick an institution, business in general, people trust their employers. We know that the Social Security system is essential, but it's not enough. You need to have, as we talked about earlier, plans that have auto enrollment, employers that have plans in the first place, plans that have simplicity built into their design, including auto-escalation, that employers address the broader financial preparedness needs, the broader financial wellness that employees need to navigate. They're going to need short-term strategies like emergency savings, budgeting, debt management like student loans, they're going to need protection -- disability insurance as an example -- and then they'll need to figure how to draw down their savings income protection.

If employers can make it simpler, and providers can help those employers do so, you'll see more and more employers -- and we're really energized by those that are on the front edge of this -- providing broader financial education and broader financial support in terms of navigating issues, especially things like budgeting, how to use your employee benefits better, how to build emergency savings, student loan assistance, and all sorts of planning tools and access to production capability.

Why don't I pause, because I think there are great examples where employers are embracing this financial wellness opportunity both because it's valuable to their employees but also because it's good for their business. It creates more engaged, more productive employees that are not distracted by the stresses that we know people have.

Brokamp: It certainly makes sense that your employer would be the nexus of your financial life. If you look back 70, 80 years ago, most people didn't have health plans through their employer. They paid for it themselves. There really was no such thing as a 401(k). Basically, you went to work, you got your paycheck, and then everything else was up to you. These days, it's very different. You rely on your employer for your health plan, for your retirement plan, for your flex spending plan. You probably get some sort of disability insurance; you might get life insurance. So it makes sense to have these things centered around your employer, especially if they embrace that responsibility. Here at The Motley Fool, we have something every year called Financial Health Day, where we have classes, we have experts come in, and basically everyone in the entire company is encouraged to take time off from work and take care of some important financial tasks. I think the whole movement toward financial wellness within the workplace makes a lot of sense. Is there anything particular that happens at Prudential that you'd like to highlight?

Waldeck: The sorts of things I'll describe for Pru we are making available for our clients. But I really am proud of the case study we have with our own employees. We started on this early. Over 10 years ago, we started tracking wellness in general, the wellness of our employees, and their financial wellness in particular, and linking the correlation between financial stress and other wellness outcomes. Examples, those that are financially stressed versus those that were not financially stressed, how did that correlate with their satisfaction with their supervisor? How did that correlate with their satisfaction with life in general? What's the correlation with short-term disability claims, or the duration, how long they're out on short-term disability? And what we found was those that were financially stressed were 2 times or more than 2 times likely to have those bad outcomes that I described. So, for a decade, we focused on the same sorts of things that The Motley Fool employment environment has, that you just described. Personal finance education seminars, in person and online, including budgeting. Elder and dependent care counseling, student loan assistance, emergency savings, I could go on and on. The punchline is, this has been a focused effort for more than a decade -- and admittedly, we're a really large employer, so we have resources to focus on this, and we're in this industry. For example, we've used IBM Watson to analyze this data over the last decade. And we cut the financial stress of our employees by over 50% over that time period. That's not only a great outcome in terms of all those people's lives, but relative to other employers that we measure ourselves against in terms of peers, we went from having a more stressed workforce to having a less stressed workforce. That's impacting thousands of Prudential employees, but it also makes us a more effective business in terms of our impact to our clients and customers.

Moser: Less stress is a good thing. I'm sure we can all agree. He's the president of Prudential Retirement, Mr. Phil Waldeck. Thanks so much for taking the time to join us today!

Waldeck: It's a pleasure! Thanks, Jason! Thanks, Rob!

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Moser: Now joining me in the studio, as always, Certified Financial Planner Matt Frankel. Matt, how's everything going?

Matt Frankel: Pretty good. It's hot down here. Is it still hot up there?

Moser: It cooled off a little bit here over the weekend. Into this new week, the mornings are cooling off a little bit, but it's warming up, though. And I'll tell you, I think they're talking about what these 90-degree days hitting us toward the middle of the week. Maybe this is the last of the last of the summer.

Frankel: It's 95 and sunny in South Carolina right now.

Moser: A little bit warmer than I wanted. I like the change in seasons, Matt. Football's here now. I appreciate the cooler mornings and cooler evenings. I'm looking forward to fall, to be honest with you.

Frankel: My wife tells me, don't even ask to go to any football games until October when it cools down a little bit.

Moser: [laughs] Yeah, I agree with that. I agree with that.

First thing we wanted to jump into this week, last week, a company we covered here on the show, DocuSign. Earnings came out for DocuSign last week. This was a bit of a different reception, this quarter, as opposed to last. If we just look at the numbers, certainly it was a good quarter. Total revenue of $235.6 million, up 41% from the same quarter a year ago. Subscription revenue was up 39%. If we look at billings, and I think billings was really a source of concern last quarter, billings were up 47% year over year. So really, what was the concern last quarter in the billings number seems like it was less of a concern this quarter. Consequently, the stock had a really good day on the release. It seems like that momentum has continued on into today. The stock was up somewhere in the neighborhood of 20% or so following the earnings release.

Matt, this is a company that you follow, too. What were some of the things that stood out to you in the release this quarter?

Frankel: The main thing that stood out to me is I'm kind of sad I didn't buy it a couple of weeks ago. Beyond that, I wanted to point out that, yeah, they're growing like a weed right now, but that doesn't mean that they're going to slow down anytime soon. Two main things to point out. First, they're still mostly domestic in terms of revenue. I think about 80% of DocuSign's revenue came from the U.S. during the quarter. That means there's still a ton of opportunity to expand its solutions going forward. DocuSign is a huge value proposition for its customers. I was reading through one of their presentations, and they say they save their average customer $36 in business expenses every time that a document is signed electronically on their platform versus manually. When I think of my realtor bringing me a contract to sign versus sending me one over the internet, that's an hour he spent to physically get me a document that he could be focusing on other areas of his business. It's a big value proposition to customers. It's almost turning into a must-have if you have a lot of signed contracts.

And then they're trying to expand beyond just the signatures. They're starting to roll out what they call their DocuSign Agreement Cloud, which would be an all-in-one, not only signing documents, but preparing them, managing them afterwards, things like that. There's a lot of value they could still create for people. Just because they're growing at a tremendous rate now doesn't mean that's going to slow down.

Moser: I agree with you on virtually all points there. Part of it, as a user, it seems like anytime I need to sign something, DocuSign is a preferred provider. My wife and I just signed a home equity line of credit document. We're going to do a home renovation here later. So the lender sent us documents via DocuSign. It was interesting, I was having a conversation with Emily Flippen last week, she was talking to me about, recently, she had moved and was going to the DMV to get all of her stuff squared away from the move. Typically, when you go to a DMV, they're asking for physical paperwork, physical signatures, proof of all this stuff that you're doing, residence and whatnot. And it turned out that, of course, they were asking for that, but they said that the other one acceptable form of documentation was DocuSign-executed agreements. That was really fascinating for me to hear. I mean, that is becoming the accepted standard when it comes to e-signatures. There's always this conversation about, what is DocuSign's moat? I don't know that there is necessarily a moat today. Perhaps they grow that network out, and the product offering, in such a way that they do develop a moat down the road. But a lot of competition in the space.

One of the names that always comes up is Adobe. It struck me, if you ask someone what Adobe does, it's not entirely easy to answer that question, at least succinctly. Adobe does a lot of things. I don't think that e-signatures are the crux of the business. That's not what that business was founded on and what they're really working on as far as innovation goes. Whereas, we talk about DocuSign, this is what they do. It's contract, e-signature management. This is the market that they are focused on. It's interesting to see how they're developing, like you said, that end-to-end solution with the Agreement Cloud. It's something that's obviously gaining some traction. They added 29,000 new customers for the quarter. They now stand at 537,000 paying customers. And to top it all off, they've introduced this Rooms for Mortgage product, which is essentially their effort to take their e-signature business into one of the biggest market opportunities out there in mortgage agreements. Like you, I feel like there are so many different ways they can go with this business, just focusing on that core competency. Listen, I'm a happy shareholder. I know they're not profitable yet, but that's inevitable when growing the top line like they are. It seems like the market's starting to come around to it as well. Maybe last quarter was just a hiccup.

Frankel: Yeah. Maybe this quarter, I'll finally pull the trigger on it and add it to mine. I've been watching them forever, and it just seems like every time I want to add to it, I can't because I've talked about it recently.

Moser: Well, we'll shut up about it for now. Next opportunity, I'll give you a little nudge, Matt, how about that?

Frankel: All right. No talking about DocuSign for the next few weeks, at least.

Moser: It's off the agenda. Let's go to the next item on the agenda. This is something that's really cool, I think. I'm excited to hear what you have to say. We've got a new launch here that you are very closely tied to. We've talked a little bit about this before, but I want you to really get into the nuts and bolts of this. All I'll say, it's real estate related, which is right up your alley. Matt, how about you tell our listeners what to be on the lookout for?

Frankel: Pretty much everybody who's listening right now knows that The Motley Fool has been a stock investment site. We're branching out to another really exciting area of investing that is one of my personal favorites -- real estate. And I'm not just talking about REITs, although that's probably part of it. But things like the crowdfunded real estate that's becoming so popular, buying properties, how to finance your investment property, things like that. We're launching a new real estate site known as Millionacres. You can actually see a preview of it right now. We're launching it later this week, but you can see a preview at www.millionacres.com. There's a lot more content coming soon, but you can see a whole lot of what we've been working on so far. I've been writing for the past few weeks almost exclusively on Millionacres content, so you can see a lot of what I've been working on there. We're just really excited to get it out there. Real estate, in my opinion, is one of the best ways to create long-term wealth, and that's what we're all about here. I am really excited to show what we've been working on with everybody.

Moser: Yeah, and I can say, we got an update on Millionacres from the team last week here at HQ. Listeners, I cannot encourage you enough to go check that site out. Like you said, Matt, what you guys are doing is really neat. It's a new direction for this business. It's focusing on a tremendous long-term wealth driver in real estate. Excited to see how you guys grow that service out. We'll talk certainly more about it here in the weeks to come.

Let's jump over to a new segment we're going to try out here. This is not something we can do every week, because honestly, Matt, we're not mining stocks every week, at least personally. But we thought it would be fun to introduce something we might be able to try every once in a while called "What was the last stock you bought and why?" Matt, I'm going to go ahead and kick it off to you first. What was the last stock you bought, and why?

Frankel: The last stock I bought was FedEx. I already owned it; I bought more shares about three weeks ago for a few reasons. One, it's gotten absolutely hammered recently. Obviously, shipping is a very cyclical business, especially when it comes to e-commerce. People buy less, there's less need to ship. Economy's strong, people are buying more, there's more need to ship. So, on recession fears, fears about the trade war, they've been hammered lately. They recently announced they're going to not renew their Amazon contract, which is going to be a long-term positive for the business but is likely to result in some short-term pain. It's a very low-margin part of the business for them, but it's Amazon. You're going to have some short-term pain when you sever ties with Amazon.

But there's a lot to like about them. They're expecting record holiday shipping volume this year, even when the Amazon contract left. They're adding lot of on-site locations in Walmarts and Walgreens and places like that. Their ground shipping is probably their biggest opportunity going forward. That's been the highest area of growth, and they're trying to keep that momentum alive. Right now, they're trading at just 11 times earnings. When you think shipping, there's FedEx and UPS and a bunch of smaller ones. It's a really fragmented market other than the top players. I think FedEx is doing the right thing, getting rid of Amazon. The focus on their higher-margin business. There's a lot of e-commerce to go around, not just Amazon. A lot of other e-commerce players are growing at rapid paces. I think FedEx will be able to take full advantage of that in the years to come.

Moser: Most likely, yeah. That's a big shipping network there. As we both know, the costs to building out that size of a business, that infrastructure, they are really primitive. They've done a lot of the heavy lifting already. Interesting buy there.

Mine is a little bit different, but you probably are getting some of this stuff that this company is sending to you via FedEx. That's Etsy. Etsy is actually the most recent stock that I bought. It's a stock that I already owned, so I added to my position. Now, it doesn't have that same attractive 11 times earnings valuation, Matt. I must not lie. This thing was a little bit more expensive-looking, around 55 times times earnings or so. But, hey, it's profitable, and it's cash flow positive. I've extolled the merits of the business model for a while now. It really was just adding to a company that I think is really continuing to succeed. If we look, over the most recent quarter, active sellers grew to over 2.3 million. Active buyers clocked in at better than 42.7 million. Their network pushed through almost $1.1 billion in gross merchandise sales.

It's neat that they have some catalysts here going forward as well. They've announced a new free shipping program. We know how free shipping plays out with consumers. They have a new unified ad platform called Etsy Ads. And then, they've also made an acquisition of a company called Reverb, which is basically like Etsy for musical instruments. As someone with musical instruments all over my house, I certainly understand the value in that. I think that's another nice little niche network that will mix in nicely with the rest of Etsy's business, and it gives them a capability that they didn't have before. I do really like this business for the long haul. Like I said, you're probably getting some stuff from Etsy courtesy of FedEx. That worked out pretty nicely for us, Matt, a little one-two punch there. That's a nice little combo there for folks that are looking for some stock ideas.

Hey, what was the last time you bought? Go ahead, hit us up on Twitter @MFIndustryFocus, or email us at industrfocus@fool.com. Let us know what the last stock you bought was and why.

OK, Matt, let's wrap things up. We have a couple of more stock ideas. As always, we go with One to Watch. What is the stock our listeners need to be watching this week?

Frankel: Well, in the spirit of the Millionacres launch, I want to give you one of the REITs that's on the top of my list: Simon Property Group. Another play on the idea that recession and trade war fears have been a little bit overdone. Retail REITs have been crushed. It's no secret that there have been a giant wave of retail bankruptcies, store closures, things like that. Look at Sears, JCPenney's about to... well, it's not looking great. So, that's hurt a lot of retail companies, especially malls. Simon Property Group, ticker SPG, is in a league by itself. They own some of the most valuable mall properties in the world. If you've been to, say, Forum Shops in Las Vegas. That's a big one that I've been to. There's the Arundel Mills mall kind of close to where Jason is right now. It's huge. The reason that they're doing so well is, they're incorporating a whole lot of non-retail elements into their properties. Arundel Mills has a casino. A lot of them have hotels built in. There's office spaces they're starting to put in, a lot of entertainment venues. They're really trying to create a built-in source of foot traffic. Sales are actually up in their tenant stores year over year, which is a fantastic sign in this retail environment. They're trading rock-bottom valuation, paying a dividend over 5%. I think they're worth a look right now.

Moser: Very cool. Very cool. All right, Simon. I'm going to go with a company, I don't know that we've ever actually talked about Zoom Video Communications, ZM, here before. Going through their quarterly results, another very good quarter. Revenue up almost 100% to $145.8 million. Customers contributing more than $100,000 in trailing 12-month revenues were up over 100%. They now have 466 of those customers. To put that into context, Slack, which just reported as well, reported 720 of those customers. Similar businesses in what they're doing. I think that shows there's perhaps some opportunity there for Zoom to pick up some big-spending customers in the coming quarters.

I thought there was an interesting snippet in the call here. They landed recently a little-known bank. Matt, you'll recognize this name -- HSBC. I say "little-known," I'm kidding, obviously. It's a very big company with 3,900 offices in 67 countries. It's going to give Zoom an opening to an additional 290,000 hosts there. They made note on the call that they're really seeing a lot of success in the financial services sector. It seems like a business that is very much plugged into those global style businesses, and facilitating communication. Certainly, HSBC is a good example of that. It sounds like they are more and more getting their customers to sign for longer contracts, which shows that those customers are realizing a lot of value there.

Still, obviously, a very new business. Still needs to work into profitability. The biggest risk in the stock by far and away is the valuation today. But, still a good business, one that we like. I think it has a good future. Certainly one to keep an eye on there. The ticker for Zoom Video Communications is ZM.

OK, Matt, I think that's going to do it for us this week. Appreciate you dropping in and joining me today!

Frankel: Yeah, always good to see you, guys!

Moser: All right, man, we will save the best, or at least some really good stuff, for next week. Of course, make sure, listeners, to tune in. 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. Today's show was produced by Austin Morgan. For Matt Frankel, I'm Jason Moser. Thanks for listening! And we'll see you next week!