In this week's episode of Rule Breaker Investing, Motley Fool co-founder David Gardner gathers 'round the microphone campfire with a handful of Fools to share some more stock stories. Three guest analysts and David himself share stories about investments they made, what happened to the stocks, and what they learned from it.

Tune in to hear about a stock that went up 6X in value while ousting just about as many CEOs; the little company that could (coexist with Amazon); a company whose story proves more nuanced than so much of the U.S. financial media portrays it; and a company that illustrates the power of developers.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.

This video was recorded on Dec. 19, 2019.

David Gardner: Some people like superhero stories and maybe spend about, I don't know, a billion dollars at a box office on a given weekend to see a superhero story. Others like sad stories. We can all think of a favorite bedtime story. It's often said of us human beings that we are a storytelling race. The call of the story, the prehistoric campfire, where stories were acted out. Huge industries today have been built up just around celebrity stories. Or how about sports? The news, scores, results, the stories we remember from our own athletic exploits, however scanty they may be, in my case. Stories, stories, stories.

Stock stories. Yep, every stock tells a story. As investors, we get to know our company's mission, maybe know their marketing tag line. That's a story. We follow the share price. We experience highs and lows, sometimes dizzying heights or cavernous losses, sometimes both. Our experience as investors gives us the long view, the Foolish view. It acquaints us with great prosperity-creating stories. Especially, look across a portfolio, look up and down your brokerage statement, and I bet you see stories.

A few times a year, we focus -- Rule Breaker Investing -- on telling stories. We're a stock market podcast, so these are stock stories. Visiting me around the campfire this week are several talented Motley Fool contributors, each of whom has a story to tell. Four stock stories to start your new year on this week's Rule Breaker Investing.

Welcome back to Rule Breaker Investing! Happy New Year. Am I the first to say that to you? I sure hope not. But thank you for joining us this week on Rule Breaker Investing. We're recording this in advance of the new year, so I want you to know that I and my friends joining me around the campfire this week did this recording on Thursday, December 19th. So if something crazy happened to any of the stocks that we're telling you a story about this week, please know, we didn't know it. Maybe we'll be predicting it with what we say in the story, I don't know, but we didn't know it. Chances are, the market won't make too many crazy gyrations between when we're recording right now and when you're hearing this. But you're hearing this the first week of the new year. So thank you for making Rule Breaker Investing a little bit of the celebratory week of the start of a new year.

Alright, this is Stock Stories: Vol. 4. As I said at the top, stories matter to us humans. They should be fun and entertaining. They should be, ultimately, I hope, didactic, or give us a lesson. If they're memorable, it makes it easier for us to repeat to others. That's kind of the reason I think that I was able to read, at the age of 10, The Odyssey, because Homer and the oral tradition, they told it memorably enough, great stories, that they could just be told without being written down for centuries, until we finally figured out how to write, and these days we have computers and other things, too. Technology is proceeding at pace. But the call of the story and the love of stories remains just as human in 2020 as it was in 2019, or 2019 BCE. So welcome. It's time for Stock Stories: Vol. 4.

Now, I've asked each of our contributors -- we have four stories for you this week -- to come with a title, and then a didactic line as a takeaway at the end. Some of these companies you may know. Others you won't. I've especially asked my contributors -- and we'll see if we do this well or not. I don't know. I probably won't do it so well. But Maria, who's going to be our first, she'll probably do it well. But we want to focus a little bit on the stocks, so, like, where the stocks were. It's one thing to read a story in Forbes about the business behind the business. But we love to see the stock behind the business. What was actually happening in the stock price? That's the thing that you and I own and follow one day, week, or month to the next -- the stock part of the stock story.

So, without further ado, I would like to welcome my friend Maria Gallagher. Maria, welcome to Rule Breaker Investing!

Maria Gallagher: Thank you for having me!

Gardner: So this is your first time, I believe, on the podcast. Am I right?

Gallagher: Yes.

Gardner: I'm so glad to have you here. Now, Maria, at the end of last year, you were working for both my Stock Advisor and Rule Breaker Investing teams. You came to us, though, not necessarily as a stock market analyst. How did it start for you here at The Fool?

Gallagher: I started about a year and a half ago as a summer intern on the Asset Management team, and then I worked on the Asset Management team in shareholder experience and marketing for about six months. Then I moved upstairs.

Gardner: "Upstairs" for us means that you are now a stock market analyst. But you have a marketing background. That's why we initially had you here. Is that right?

Gallagher: Yeah. I studied psychology in school.

Gardner: That's awesome. Did you ever tell stories? Were you part of the storytelling club at school? Did you ever play a role-playing game?

Gallagher: I did theater my whole life. Lots of games, lots of storytelling.

Gardner: Awesome. Let's get started then, Maria. So what is the title of your story?

Gallagher: The title of my story is "I Think I Can, I Think I Can Coexist With Amazon."

Gardner: Excellent. And is there a focus company we'll be talking about?

Gallagher: Today I will be talking about Etsy (NASDAQ:ETSY).

Gardner: Wonderful. Maria, why don't you get started?

Gallagher: Okay. My story starts in 2005, where some friends created a marketplace so that one of them could sell his handmade wood crafts online, naming it Etsy after the phrase, "eh, si" from a movie I've never heard of called 8 1/2.

Gardner: I didn't know that. Thanks!

Gallagher: You're welcome. So, fast-forward to 2015. Etsy entered the public market after a little bit of a leadership shake-up. The articles at the beginning of its stock run were pretty glorious. I found some of them, and they have titles like "Etsy Shares Surge in Market Debut" and "Etsy Now Worth Over $3 Billion, Stock Jumped 88% After IPO." The initial pop for Etsy took the IPO price from $16 a share to $30 a share. But trouble loomed ahead for this newly public company.

Fast-forward a couple of months, and Etsy was trading at $8 a share, one of the worst-performing IPO is in 2015. The headlines now read, "Why Etsy's Stock Has Fallen by Half in Two Months" and "Etsy Looks Way Too Expensive at Current Value." The first line of that article is actually, quote, "Etsy operates a niche business that lacks the market breadth, scale, and resources to effectively compete against well-established e-commerce giants."

Gardner: OK, let me ask you right there -- because it does occur to me, Maria, you and I take for granted our knowledge of Etsy. I feel like a lot of people know Etsy. But I want to back up for a quick second and ask you, what is the business of Etsy, for those who don't know what we're talking about right now?

Gallagher: Yes, so, Etsy is a two-sided marketplace that sells handcrafted online goods. You can go and get anything from jewelry to a door to a lamp, anything you might want, and it's all going to be pretty unique and handcrafted.

Gardner: Very well done. I should mention, a lot of longtime listeners know this, Etsy is our example company that, whenever we play The Market Cap Game Show, we use Etsy as an example. So it has cult status on this podcast, in part because Matt Argersinger, who was my first contestant ever for the first few episodes of The Market Cap Game Show, each time, he knew it was coming, but he still couldn't name the market cap within 20%. He just had a mental block. And so Etsy is, in its own small way, famous here on Rule Breaker Investing.

OK, let's go back to the story then.

Gallagher: So the rhetoric clearly changed around Etsy. Amazon had entered the space with Amazon Handmade, and there was, in a lot of people's minds, no way that Etsy could compete. However, compete they have, with persistent revenue growth, a five-year revenue CAGR of 43%, and a return on invested capital of 28%. It currently boasts over 2.4 million sellers on its platform and 63 million items. The stock itself is still pretty tumultuous. It's currently trading at $43.98 a share, which is down from the high of $71 a share in early 2019. But I think the story of Etsy is still in the beginning chapters. It's carving out its niche. There was some more leadership overhaul and shake-up around 2017, and there was an improvement on profitability closely afterwards.

Amazon's known for cheap and easy items, so Etsy has carved out a niche for itself that Amazon can't really extend to because, to be honest, no one really wants to hear, "I got you something super, super special. I got it on Amazon."

Gardner: [laughs] I laugh, but I do think it's true. I'm as big an Amazon fan as they come, probably, both as a fan of the business and of the stock, which has treated us all so well over the years. But I do think you're right about that, Maria. The promise of a unique, handcrafted item, which I'm sure somewhere on Amazon, you probably can buy, but just the brand association is, I think, your point.

Gallagher: Yeah, and I think also, with Etsy, it connotes an idea that somebody took a lot of time, because the shipping isn't going to be next day, so they didn't think about it two days before they remembered it was your birthday, because it's handcrafted. So you know it probably took a little while to get to you. They had some foresight. So I think it makes the idea that that person was really thinking of you. So it makes it feel special-er.

Gardner: Have you been a buyer on Etsy?

Gallagher: I have.

Gardner: Would you like to share something that you've appreciated that you found on Etsy?

Gallagher: My friend and her boyfriend moved into an apartment together. She is obsessed with the TV show Friends. I found a mug on Etsy that you could personalize. So I got her a mug. All of the friends titles are "The One Where ... " which I think is very clever, so I got her a mug that says "The One Where Alyssa and Patrick moved in together."

Gardner: Wonderful.

Gallagher: And it was a hit.

Gardner: And you probably couldn't have got that as easily on Amazon. Is that fair?

Gallagher: I don't think so, no.

Gardner: Have you ever listed something for sale on Etsy?

Gallagher: I haven't. I'm not actually a very good crafty person, but I know people who have.

Gardner: All right, Maria, I feel like you're about to get us to the didactic, big, one-line takeaway, and maybe it hails back to the title of your story, because sometimes those things are related. I don't know. But a little bit earlier in the story, you tossed glibly off your lips a phrase that we would understand around here, because it's an acronym. You said "a CAGR." That's compound annual growth rate. Am I right?

Gallagher: Yes.

Gardner: And what is that, exactly? Can you just summarize for somebody who may be new to the stock market, and just hearing this impressive Motley Fool analyst go, "Yeah, it's got a CAGR of blah, blah, blah."

Gallagher: [laughs] Yeah. So it's basically just the way that the revenue has returned. You do it annually, and you compound it, and you see how the stock has changed.

Gardner: Yeah, and all kinds of annualized growth rates are important for us, whether it's the top-line sales or the bottom-line net income or some of the middle lines, like looking at cash flows or other things. So, yes, annual growth rates, a big part of us finding good companies. They're the ones that have good growth rates, that do it over time. And I think part of the magic of CAGR, Maria, is that you can't be a one-year wonder, can you? These are annualized over three- or five-year periods, which is a smoother way of analyzing a company.

Gallagher: Exactly. It narrows out those outliers.

Gardner: Well, I feel like I've gotten us a little bit down in the weeds. Let's get back to the thrilling conclusion of your story. Maria, what is the takeaway of "I Think I Can, I Think I Can, I Can Coexist With Amazon"?

Gallagher: My lesson from this is, if you can differentiate yourself, you can compete.

Gardner: That is so important in business. For us as investors, we're always asking, what is the competitive advantage? What differentiates this company or that company? It also works in life. Maria, for you as a person, either as a working professional or a longtime member of your family, what's a good example of how you're differentiated?

Gallagher: I think for work, I come from a pretty different background of studying psychology. So I think I look at companies a little bit differently than other people might. And then, in my family, I think I am hands-down the funniest person in my family, and I will fight anyone who says that's not true.

Gardner: [laughs] Excellent. Well, Maria, thank you very much for sharing your story about Etsy. Psychologically, do you feel positive entering 2020 for Etsy shares the next three-plus years?

Gallagher: I do. They're working a lot on making free shipping more of an option for people, which is, in the Amazon world, kind of table stakes. If I see that something costs a lot of money in shipping, I might not buy it. So, I feel like that's exciting.

Gardner: You bet. Maria, thanks. Fool on!

Gallagher: Thank you so much for having me. Happy New Year!

Gardner: Well, my next friend has just sat himself down at the campfire here around which we're telling stock stories this week. Jim Mueller, great to see you again.

Jim Mueller: David, a pleasure to be here.

Gardner: Happy New Year!

Mueller: Happy New Year to you!

Gardner: Was 2019 a good year for you?

Mueller: 2019 was a great year for me.

Gardner: I know in part it's because you went to a new area of the world that was a very special trip.

Mueller: I was able to take the entire month of November off, and I actually completely unplugged. I didn't even look at news or sporting events or anything.

Gardner: I don't think I've ever done that, Jim. Wow!

Mueller: [laughs] It was awesome. My wife and I went to Sydney, Australia, to start a tour that ended in Auckland, New Zealand, with a few days before and after, and a cruise ship, which I'd never been on before. It was just an awesome time.

Gardner: That is wonderful. And that's all just one month within 12. The backdrop that continued to occur while you were on that trip is that the stock market went up in 2019.

Mueller: Yeah, but my own portfolio is trailing it just a tiny bit.

Gardner: I understand that. As I've already mentioned to our listeners, we're taping this near the end of 2019. Even though we're saying Happy New Year, we don't actually know how things closed out 2019. But it's been an awfully good year for the most part. Netflix (NASDAQ:NFLX) is a big holding for both you and me. Underperformed at different points in 2019. Maybe hurting our results relative to some other stocks that didn't.

Mueller: Yeah, probably. But we're both long-term holders of that company in particular and companies in general.

Gardner: Yeah, I'm glad I mentioned Netflix, because I believe, Jim, you might be telling a story, maybe, about Netflix?

Mueller: Yeah, imagine that. [laughs]

Gardner: What's the title of your story?

Mueller: The title of this story is, "Just Because Everyone Believes It, It Ain't Necessarily So."

Gardner: OK, good. start us.

Mueller: Netflix, as you know, I've held for many, many years. I've followed the company for many years. I want to talk a little bit about the narratives that are in the news, the financial press, about this company, and in particular, how it's almost always focused on the domestic story. Even way back in the day, recalling the Qwikster episode --

Gardner: 2011.

Mueller: Fall of 2011. That's when, also, the day that Netflix announced that they were raising prices, basically, Starz announced, with malicious forethought, that they could not come to an agreement with Netflix on the renewal of the licensing for the streaming content. That helped drive the prices down, because everyone was freaking out. "Oh, no, Starz!"

Gardner: I remember that. I'd forgotten that eight years later, but yes, that was part of that story.

Mueller: Yes. That was how they got their big library, and they don't have enough content, and this ties into one of the things that everyone knows, in that you might not find much to watch on Netflix, and if you're not finding it, how do you know other people are finding it? And therefore, the company is going to go down in flames. Because you, yourself, can't find stuff to watch on Netflix. In fact, there's a colleague here in the office who I don't believe has ever invested in Netflix because of that very belief.

Gardner: It's funny, because now here in 2020, I see a lot of Starz shows on Netflix. For example, Outlander.

Mueller: Yeah, well, Starz learned their lesson.

Gardner: OK, well, let's go back in time again to where you were.

Mueller: Netflix, as everyone knows, has licensed a bunch of content. They had the Disney deal. The same story is repeating with Disney with Disney launching Disney+. They're letting the Netflix license roll off and not renewing it because they don't want to have the content on a competitor. And everyone's crying wolf again, in my opinion, in that Netflix is no longer going to have the popular content, and given the popularity of everything Disney owns nowadays -- Star Wars and Pixar, and just name it, they own it -- everyone's again saying Netflix doesn't have the content. And that's not really true, because Netflix has some very good stuff. You just look at the awards they've been winning, and the Golden Globe nominations. They nailed it on that one. Traditional TV is not even in the picture anymore.

Further, the Disney+ and the Apple TV+, whatever the name of that service is, and Peacock from NBC Universal, and Hulu and Amazon Prime and all this -- all these are going to be the famous Netflix killers, and it just hasn't happened in the past. Walmart was going to be the Netflix killer. They had DVDs, Walmart was going to rent out DVDs.

Gardner: Yeah, you could drop it off at Walmart, you wouldn't have to mail it back to Netflix in the age of DVDs.

Mueller: Exactly. Reed Hastings and his team have seen the same story play out over and over and over again. They're familiar with it. They know how to work it, and they can see a path through.

My story, everything I've mentioned so far has all been domestic. All these worries are about the domestic market here in the U.S. Netflix is not a domestic company, not nearly as much as people think it is. Here's what everyone thinks is true -- focused on the U.S., while ignoring the fact that back in Q3 2017, when international subscriber count outnumbered domestic --

Gardner: Was that the first time that happened?

Mueller: That was the first time that happened. That quarter was when it flipped to being more than 50% international on subscriber count. And in revenue, it flipped to international just nine months later, Q2 2018. And ever since, revenues from international have been growing more than revenue from domestic.

Gardner: Which I guess makes sense, because in the end domestic, which is the U.S., is about 300 million people, which means we're outnumbered by about 20:1 by the rest of the world. So you would think being big internationally and having a real on-ramp there would be a great bullish sign.

Mueller: Exactly. But it is ignored so much in the press and in the thinking of investors. There's a name for this. It's called home bias. People tend to invest in companies in their home country. Here in the U.S., we are very much focused on news in the U.S., and we don't listen to very much news from outside the U.S. But my trip to Australia really reminded me, it's a really big world out there, and there are a lot of people out there. And Netflix is taking advantage of it.

On Monday, the 16th of December, Netflix reminded the market -- actually, in my opinion, kind of slapped the market in the face and said, "Hey, pay attention!" They filed a form with the SEC, an 8-K form, you can find it on the SEC EDGAR website, in which they broke out their international subscription numbers and revenue-per-user numbers, data that they hadn't shared before.

Gardner: So, for the first time.

Mueller: For the first time. They've been reporting U.S. domestic and all of international. Now, they're reporting U.S., Canada, Europe, Middle East and Africa, Latin America, and Asia Pacific. These are the traditional geographies that companies tend to report in. So, they're giving us a lot more detail, and they're showing that the growth in these places is faster than you might expect, even though, as a group, you could see it from what they were reporting already. Even more surprising, the ARPU, the average revenue per user -- what each person pays on average for the service -- is probably higher than many people thought. Europe is around $10. The U.S. is around $11.50. I'm going off memory here. Latin America is around $8. Asia Pacific is around $8. But you can see the trends going up for each region, and you can see this playing out. So what Netflix is saying is, "Don't assume just because you're located in the U.S., and you think there's nothing good to watch, that we cannot succeed."

Gardner: OK. Jim, thinking about the stock then, looking backwards just at the year 2019, for example, it was rocketing to all-time highs in the spring. I think it hit over $380 a share as an all-time high as recently as July. And from around $385, it dropped to $250 in just three months in the fall of 2019. How much of that in your mind was Disney+ coming online, Disney pulling its stuff off Netflix, Disney+, Disney+?

Mueller: A fair amount of it. But also, back to this domestic focus, in Q2 of this year, they reported their first drop in domestic subscriber counts for the first time in many, many years. That really scared everybody. But, again, it's an international growth story. In a few days between when they released this international data and when we're taping on Thursday, the 19th, shares of Netflix have risen from about $304 to well over $331, almost exactly 9% in just three days.

Gardner: All right. Well, thank you, Jim. A company that you and I have observed for 15+ years, covered them. Jim, no one has covered Netflix better or more voluminously with a better memory than you have, whether it's on our discussion boards or through services like Motley Fool Stock Advisor. So, let me thank you for all the great work you've put in on NFLX over a couple decades now. It's been rewarding for all of us who are listening who own the shares.

Jim, what is your one-line takeaway at the end of your story?

Mueller: It's basically the title again. "Just because you think something doesn't make it true." And, "it's a big world."

Gardner: Well put. Jim, Happy New Year!

Mueller: Happy New Year, David!

Gardner: All right, and my next friend joining me at the stock story campfire is Tim Beyers, longtime analyst with me at Motley Fool Rule Breakers and working on a lot of other interesting stuff. In fact, I'm going to ask him very shortly to talk about his new project here in January. But first, let me welcome him. Tim, welcome!

Tim Beyers: Thanks, David! It's great to be here.

Gardner: Thank you! It's great to have you back on the show. Geez, we've worked together almost since Rule Breakers started. I know we started the service in October 2004. You were online with this within the first year, right?

Beyers: Yeah, the first six months. I convinced you that Akamai was a Rule Breaker. You agreed. And that was April of 2005. And we haven't looked back.

Gardner: That's right. In fact, you're the one who really brought cloud computing to us at The Motley Fool. You started saying, "Hey, is anybody looking at what's happening out there? It's going to be called cloud computing." You brought Salesforce to Rule Breakers early on, and we have a beautiful long-term win in that position. Tim, thank you for that and many other things.

I think the story you're going to be telling us relates to another stock that you brought to Rule Breakers and that has made our members happy. Tim, what is the stock subject of your story?

Beyers: The subject of my story is MongoDB (NASDAQ:MDB). My title is, "What You Look For Matters More Than What You Find."

Gardner: "What you look for matters more than what you find." Tim, go ahead.

Beyers: MongoDB is a very interesting company. For those who don't know it, they are a database provider. A database is just where you store information digitally. If you have images, if you have numbers, or whatever it is, you store it in a database. Developers use these all the time. MongoDB looked like, to a lot of people, before we brought it into Rule Breakers, as this little upstart that was destined to be crushed by Oracle, which is, of course, the big dog in this space. So, when I was looking at this in the beginning of 2018, I knew that the numbers, the financial statements, frankly, just weren't going to say very much about this company. And I think, David, we found that many times at Rule Breakers that a lot of times, the financial numbers sometimes can be even a little bit misleading in some cases. When I was looking at this, I started looking at the things that other people weren't looking at. And it's, how do developers see this company? A few things stood out.

DB-Engines is a ranking system of how popular databases are. At the time of MongoDB's IPO, not only had its ranking shot up by orders of magnitude since 2013, but at the time, it was the No. 5 database in the world, and it was the only one of its kind that was doing this work called NoSQL, and what that means is, in a world like we live in now, where a lot of the data you want to store is images or video or things like that -- our mutual friend Carl Thiel described it as, the NoSQL database is like your kitchen pantry. There's a million things you store in your pantry. Lots of different food, and none of it is the same thing. That's the specialty of MongoDB. So it became very popular for this.

In addition, this company was started in 2007. I thought that was fascinating. Not only was it started in 2007 by three people who decided they wanted to start their company and keep it in New York, instead of move it to Silicon Valley at the insistence of venture capitalists, they were just going to build something that they wanted to be great. And they started it as this platform called Tengen. And as they went along, they realized, "Wow, the database we built for this thing is good. In fact, it's so good, it can store so much data, that people call it Mongo. So, we're going to call it MongoDB."

So, first of all, it had an interesting evolution. The founders had been very committed to this business over those 10 years. And they owned 15% of the business. I thought that was super interesting.

And then, two things that are interrelated that stuck with me. There had been 30 million downloads of the free version of this product at the time of the IPO. I thought that was staggering. But what's even more interesting is that over the prior 12 months, 10 million of those 30 million downloads had occurred. So it was accelerating. Lots of interest. And at the time, they had introduced this version of the product that would exist entirely online, entirely in the cloud. I thought that was fascinating. It had grown from contributing 1% of revenue up to 8%. This was a thing called the Atlas. And it was just a way for, if you downloaded the product, you're using it, and then you wanted to get started with doing more with it. Well, then, you would just log into Amazon Web Services and use the Atlas version of Mongo.

So all of these things told me that this was a company that was on the rise, that was moving very quickly, and was very popular with its most important customer segment: developers. And, thankfully, David, you agreed. And we put it in Rule Breakers. And boy, it's been a great winner.

Gardner: Yes. Again, thank you, Tim. It was, in fact, February 28th of 2018, so just under two years ago. Our cost basis for Rule Breakers members, $32.21. The stock recently tipping the scales at the end of the year right around $130. That's a pretty good two-year return.

I think what's so interesting about Mongo DB, Tim, is that it's kind of open source. You mentioned people are downloading a free version. I know a lot of people -- and I'm not a developer myself, but I think I understand a little bit about open source -- are probably scratching their heads right now, going, "How is there a business there?"

Beyers: Yeah, what a great question. In fact, the very fact that it's open source is a little bit of a threat to MongoDB's business, but it's also a real advantage. What open source means, putting it in really simple terms, it's almost like, let's say you wanted to build a car. And all you had to do was design the way you wanted to fit in the car, like the fit of the seat, and the style of the steering wheel. Most of the things that are essential to that car have been prebuilt. Open-source software is like that. Software libraries have been prebuilt to do all sorts of things. And because of that, MongoDB was not only easy to build and easy to use, but it was really easy for developers to adopt. Of course, because of that, it's also easy to copy. David, this stock has visited many places over the past two years.

Gardner: Can you briefly remind us of that, Tim? I mentioned, I hope it didn't sound too much like bragging, our amazing cost basis of $32 a share, tipping the scales around $130 at the end of 2019. But where did we go in the meantime?

Beyers: Oh my gosh, it went all over the place. These are just a few of the drops that happened in between then and now. It was down 20% in April 2018, then another 19% in June of 2018. 24% between September and October of 2018. Then, in January of 2019, when Amazon decided to copy what MongoDB was doing, it was down another 13%. It was down 14% in March of 2019. And then just recently, even though we're so far up, it was down 33% from June to October of 2019. And inevitably, if you trace back and you look at that stock's story, almost what happened every time is, MongoDB would come out with some really interesting business results, and because it was either priced excessively or it didn't quite hit exactly what Wall Street wanted, it would crater temporarily. Then it would gather momentum and keep coming back.

Gardner: That is amazing. And even though we've held it all the way through, Tim, I have to admit, I hadn't looked at it that carefully. I had no idea that it's had something like six double-digit drops in less than two years. This is for a stock that has quadrupled for us overall. What a remarkable story that is. In fact, I want to triple underline that for our listeners this week, because of all the stock stories, that might be the single most amazing thing that we have shared this week. It's not true of every company. It's not true of every winning stock. But to know that it can be true. Drop, drop, drop, drop, of a great stock, is a reminder of the importance of patience and finding excellence and holding on.

Beyers: There's no question. When I titled this "What You Look For Is More Important Than What You Find," what you find is, especially in the world that we live in, in the world of stock investing, there's so much data available, it's very easy to find things like a P/E ratio or an analyst comment that this is an overvalued stock. But if you set your lens on what's really important about this business -- and for us at Rule Breakers, we set our lens on, this is a tool that helps developers. So what do developers think about it? So you go looking for that data of what developers think about it, and it tells a very interesting story about this business. I will go out on a, I guess, not very long limb here and just say, I think the story holds up. I think this story goes on for at least another 10 years.

Gardner: And that's an important statement. Thank you, Tim, because yeah, we do tell stories this week, and they're mainly about the past, but for each of the companies we're talking about this week, these are stocks that we actively recommend today, and we like them from this point going forward. Even though we're telling stories of the past, I hope to inspire, I hope you'll realize that MongoDB, Netflix, Etsy, and what I'm about to talk about, Lululemon (NASDAQ:LULU), these are all future winners -- well, I sure hope so.

Tim, what is the takeaway line that you have for us here at the end of your story?

Beyers: I'm going to steal a line from Steve Ballmer. If you've never seen this, it's a famous YouTube video, where Steve says, "Developers, developers, developers, developers." It's a hilarious video, but it is true. And I think something we've found in Rule Breakers, particularly in some of the tech stocks that, David, you've been putting through to our members, that developers do matter. And where they put their time, where they put their talent, where they put their resources, tells you a lot about how industries are shaping up. And there's a lot of value created when developers get behind a technology. And in the case of MongoDB, boy, they really have.

Gardner: Tim, what was the title of your story, one last time?

Beyers: "What You Look For Matters More Than What You Find."

Gardner: I like that. It was reminding me, when you first said it, of Flannery O'Connor, the very talented female short-story writer of the 20th century, because it sounds like one of her titles. Two of her more famous short stories I remember reading. One is A Good Man Is Hard to Find. So, it's kind of allusive to what you just said. Another is Everything That Rises Must Converge. I just think you are titling in the Flannery O'Connor tradition. Well done!

Beyers: I love that. I'm going to take that compliment. That's fantastic!

Gardner: Happy New Year, Tim! Let me ask you in closing, what's one wish that you have for the year? Maybe it concerns a certain thing you're working on right now at the start of 2020.

Beyers: My wish this year is that our members and anybody who is not a member will take a look at the cloud, because we have a service upcoming that we're launching in January of 2020. We're calling it Motley Fool Discovery Cloud Disruptors 2020. We are going to introduce the world to the cloud value chain. What I mean by that, David, is we think that most of the world, when they look at the cloud, they see software-as-a-service companies. They see Salesforce, they see HubSpot, and these are great companies, but the cloud is so much bigger than that. So when we launch this product, we're going to take a look at all of the things that comprise the cloud, because we think there is so much more to be learned, and so many great returns to be had, looking at the entirety of what the cloud can be.

Gardner: All right. Thank you, Tim! Well put. Good luck with that. Calling in from our Foolorado offices, longtime Motley Fool analyst and writer Tim Beyers. Tim, Fool on, and Happy New Year.

Beyers: Fool on, and Happy New Year to you too, David.

Gardner: All right, and I get to be the closer this time around. Thank you for sticking around for stock story No. 4. I've entitled this one "How To Make 6X Your Money Despite Enduring Almost As Many CEO Firings." And, as I've mentioned, we're going to take a look at the story at Lululemon.

Lululemon, I think most of us know, higher-end clothing retailer around fitness. Most particularly women's yoga pants. But these days, men's apparel as well. And the power of a brand, which is foreshadowing the end, my money takeaway line for this one. But let's go back briefly and look at 2007.

It was late July 2007. This Canadian retailer, Lululemon Athletica, started in Canada. They were getting ready to price the initial public offering for Lululemon Athletica. These are split-adjusted numbers, but initially, they were thinking $5 to $6 a share. And then, just a couple weeks before getting ready to IPO, they decided it was so popular, it was oversubscribed, they raised the target price from $5 to $6 to $7.50 to $8.50 a share and also added 2 million more shares on top of it that they wanted to offer. So they saw the money, and they did what you would do, too. They saw the demand, so they supplied more shares, and they raised their price. But when that first share traded on the day of the IPO, it traded at $14, well above $7.50 to $8.50 per share. Lululemon had a tremendous IPO, raising over $325 million. And back then, 2007, the company was worth just over a billion dollars. So it was up about 50% on its first day. One of those IPOs.

By the way, the company founded by Chip Wilson, who owned a bunch of shares back then. A Canadian, of course, himself.

Now, how had I first heard about this company? Well, my sister. My brother Tom and I have a younger sister, Mackie. She's the fittest of the three Gardner siblings. She's also a certified Pilates instructor. So way back then, somewhere around 2005 or 2006, my sister was saying, "Dave, if a company called Lululemon ever comes public, I think you should look at that. Consider recommending it for your services, because I think it's a great company, it's going to be a success." That's how I knew a little bit about Lululemon before it came public.

But when it came public, I did what I typically tell you to do, which is, don't jump in the first day. Don't go get that IPO's shares. Often, they'll be lower six months later. So I just sat there, and I watched it over the next three months double again. Again, it came public, huge uplift at $14, right about the start of August 2007. By mid-October 2007, It was at $29. A solid double from its IPO big-bang first day.

But since I'm telling a stock story here, I would be remiss if I didn't mention that within a year and a half of that, do you remember 2008, 2009? Do you remember the Great Recession? I sure do. I bet you do, too. Lululemon had dropped from $29 at its peak in October 2007 to $2.25 a share in March of 2009. It lost more than nine-tenths of its value less than two years after that IPO.

Now, again, it wasn't all the company's fault. It was really the economy. So many companies lost a lot of their value, 60% or more, some big American stalwarts. So yes, it was that time and that place. And Lululemon, an upstart, a Canadian retailer, got trampled.

Well, I'm never the guy who buys at the bottom of just about anything, so I kept watching Lululemon. Sure enough, it recovered faster than I was expecting, or most people did. 2009. 2010, finally, the stock market gets good again. It's been pretty much good ever since. I finally decided about nine years ago, it was December 22nd of 2010, that I would recommend Lululemon Athletica for Rule Breaker members. I'm sure I made my sister happy that day. I wasn't that happy, though, because guess what our initial price was? It was $35.85. That's right. I wasn't the guy recommending it down at $2 less than two years earlier. I watched it go from $2 back to $4 back to $10 back to $20, up to $35.85. Now, I typically am going to tell stock stories that are exciting and have positive lessons. So you might imagine that Lululemon has been a good stock, even though we got it at $35.85. And if you were imagining that, you would be right.

Now, by June 2013 -- that's two and a half years later -- it had gone from $35 to $80. Now, anybody who knows Lululemon will recognize June 2013. People call it Pantsgate for Lululemon. It was that very week after hitting that high over $80. It had been a double for us in Rule Breakers. It was announced that some of Lululemon's black yoga pants were unintentionally transparent and, quotes, "too thin," which would force the company to recall 17% of all women's pants sold in their stores. By the end of that year, 2013, the CEO, Christine Day, resigned.

Now, I'm going to progress forward with the story in just a sec, but I do want to reflect briefly on Christine Day, a Canadian herself. Incredible background. As a young woman, she was working at a money management firm, and one of their clients at the time was a young man named Howard Schultz. Howard hadn't yet bought Starbucks, a chain he was thinking of acquiring. He was just running Il Giornale, the coffee outlet. He had his money managed by this firm. And Christine Day decided she was impressed by him and his vision and went to work for him. She was at Starbucks for the next 20 years prior to joining Lululemon as its CEO. In fact, I think she may have been running Starbucks Asia Pacific when, in 2008, it was announced she would become the CEO of Lululemon. And if you're piecing all this math together with me, you'll realize, she became a public market CEO after Lululemon was public, and those first couple years were tough for her.

Well, Pantsgate felled Christine Day. She left the company in December of 2013. Rising to take her place was the founder, Chip Wilson. Now, Chip Wilson himself two years later would go on to say in public -- this was not a good thing for him to say -- he said something to the effect of, some women's bodies were not made for Lululemon clothing. He was criticizing a portion of his own customer base, defensively reacting to some of the reporting about Lululemon. And, in fact, Chip Wilson himself would then resign in 2015.

Which then brought on the next CEO, Laurent Potdevin, who himself in 2018 was forced to resign both his position as CEO and from the Board of Directors under accusations of a toxic workplace culture at Lululemon and some improper behavior on his own part. If you're interested in this kind of sordid thing, feel free to google it more on the internet. Suffice it to say, the critical part of my story -- which, as you'll remember, was entitled "How To Make 6X Your Money Despite Enduring Almost As Many CEO Firings" -- just about two years ago, Lululemon lost its latest CEO, Laurent Potdevin.

I bet you're wondering how the stock did during all these times. Well, again, the week that Pantsgate hit, it went from that new high of $80 down to $62 in just a couple of days. So, it lost a quarter of its value on that. By the end of that year and into next year, it had dropped below $40 as Christine Day resigns. Fast-forward to Laurent Potdevin in 2018 getting fired, basically, from the company. The stock had recovered to $77, but from the day he left, pretty much through today, as I'm sure many of you will know -- I hope you own Lululemon; I hope you're a Motley Fool Rule Breakers member -- the stock has pretty much gone straight up. As we recorded this podcast right at the end of 2019, Lululemon was at $230 a share. So, that initial cost basis of $35.85 for Rule Breaker members, which was a big multiple over the $2 it had been trading at about a year before, has in fact gone from $35 to about $230.

Now, just like the other three companies discussed earlier, the story continues for this. For all of them. The market will continue trading. The world will keep growing. I hope these stocks will keep growing. You and I will continue to see the remarkable volatility that a company like MongoDB has, or Lululemon. But I think my takeaway line, my didactic learning from Lululemon, is that great brands will overcome.

Lululemon is basically just a yoga pants retailer, and a pretty solid well-known brand, all the way through, if you knew it back in 2008. Even if you didn't, I bet you'd heard of it by 2013 or 2014. And here we are in 2020, it's pretty much been Lululemon all the way through. But the incredible volatility of the stock price is a reminder -- and we heard that a few other times this week -- of how much volatility you will go through even for something as simple as a branded yoga pants retailer. But one thing that Lululemon has done a good job with, I call brand management. The quality of the products, despite some temporary shabbiness. The effort to grow the base of buyers. Not just women today, men as well. The understanding of how to just do business right. And yet, having had such poor leadership at different points over the course of the last 10 years, it's an incredible testament to the resilience that you sometimes have to show as an investor, even in some of the simpler-to-understand companies. So yes, my takeaway line: "great brands can and will overcome."

Alright, good luck to Etsy, to Netflix, to MongoDB, and to Lululemon Athletica. Good luck to us all as shareholders in these enterprises. I think each of them is an excellent enterprise with all the human flaws that you'd expect to see. We sure hope for good things ahead and more great stock stories from these stocks and others.

Well, that was Stock Stories: Vol 4. Thanks for being with us here in the first week of 2020. I do want to mention what we're going to do next week. The second week of every year, I've made a habit of talking about my worst stocks. So yep, next week is David's Biggest Losers: Vol. 5. It's time for me to eat crow, as I do every year right around this time.

And then, the following week -- and I'm going to preview this; I don't usually do this -- we're going to be doing a five-stock sampler. I already know the theme. I'm going to give that out to you now. If you have suggestions for me, for stocks that would fit this theme optimally, tweet us @RBIPodcast on Twitter. It's going to need to be stocks that are within the Supernova universe. If you're a Stock Advisor or Rule Breakers member, it's going to need to be those companies. But here it is.

A lot of us start each year with some new resolutions, and among those, in addition to things like better exercise, eat better, lose weight, another big one is simplify, clean things up. Maybe a spring-cleaning mentality, but it's not just spring. There's a lot of that in January. Marie Kondo has distinguished herself as an influencer and a voice for simplifying your life, most specifically simplifying your stuff. I know there are a lot of Mar-Kon fans out there. And you know her signature line, which is, you pick up something like an old sweater, you're trying to decide, do I keep this thing or not? Trying to clear out my wardrobe. And you ask yourself this question: Does it give me joy? Does it spark joy for me? This old sweater? Or that award I got for penmanship in fifth grade? Or that photo album for my third dog 23 years ago? Do I keep it? Does it spark joy?

My supposition is that the companies that spark joy for us as consumers probably are among the best stocks that you can buy to hold for long periods of time and reward us. So the five-stock sampler: Five Stocks That Bring Us Joy. And if you know our portfolios both in Stock Advisor and Rule Breakers, and you think there's a company that does that really well, tweet us @RBIPodcast. You might help me figure out which five, because I've got a lot to pick from, should fit that sampler. So, that's the next two weeks.

In the meantime, thank you again for joining me during a holiday week. I hope you are having a wonderful start to your new year, wherever you are around the world. Thanks for tuning in to Rule Breaker Investing. I'm David Gardner. Fool on!