In this episode of Industry Focus: Tech, Dylan Lewis and Motley Fool contributor Brian Feroldi discuss four great tech stocks you can get for cheap. Learn what cheap means and common mistakes investors make while choosing cheap stocks.
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This video was recorded on September 25, 2020.
Dylan Lewis: It's Friday, September 25th, and we're talking about cheap tech stocks. I'm your host Dylan Lewis, and I'm joined by Fool.com's extreme entrust of essential extra edits, Brian Feroldi. Brian, I don't think that's true. I think that you are, at least when it comes to audio, pretty clean. We don't have to do too much editing here on Industry Focus.
Brian Feroldi: As long as I don't have to pronounce anything or write anything or spell anything, I'm OK.
Lewis: [laughs] That's true, you are TMFtypo; and you know, it's good to own that, I think.
Feroldi: That's right. [laughs] Celebrate your weaknesses in life.
Lewis: [laughs] Well, if you own them, then it just becomes something people expect and enjoy, you know, which is fun.
Brian, we're going to be talking about cheap tech stocks on today's show. And maybe this is kind of a palate cleanser for all the people that have listened to us [laughs] talk about JFrog and Snowflake and Zoom, and ZoomInfo over the last couple of weeks and said, guys, I mean, it's great, but at the same time I'm looking for something that's not trading at 50X sales. [laughs]
Feroldi: And talk about a role reversal here. I mean, you're right, we have talked about nothing but awesome businesses that are tech stocks, that are dominating, growing like crazy, their stocks are on fire. This show today is basically the exact [laughs] opposite of all of that.
Lewis: [laughs] And I think as we start the conversation, it's important for us to talk about what we mean when we say cheap, because there are going to be people that say, OK, I'm expecting you to talk about penny stocks. That's not what we're going to be doing here. We are looking at companies that are cheap on a valuation basis. And I think it's important for us to define that difference between cheap on a valuation basis and cheap on a share price basis.
Feroldi: You are 100% right, and I'm glad you pointed that out. It is extremely common for new investors to think that cheap just means a low dollar amount of a share price, but when we're talking cheap or expensive, what we're talking about is the size of the business, or the market cap of the company, relative to its financial performance. The metrics that we throw around all the time to talk about that are price-to-sales, price-to-earnings, price-to-free cash flow, you can also do a discounted cash flow model. So, yeah, when we're talking about cheap today, we don't care about the dollar amount of a single share, we care about low valuations; that's the metrics that we're judging these companies by.
Lewis: Yeah. And it's a common mistake, and it's one that a lot of new investors make. I know I'm certainly guilty of it, thinking back to my early investing days, being like, you know, I would much rather buy that $10 stock than this probably quality business that's $150/share. Ignoring market cap, ignoring traditional valuation metrics and instead fixating on the share price meal to accumulate a bunch of them.
Brian, I think you have a horror story with that too, right?
Feroldi: Yeah. Like most new investors, when I first started and didn't know anything, I thought that the way to make money was to buy cheap stocks that traded below $1/share, because if it's a $0.50 stock, it can double a whole lot faster than a $100 stock. Boy! Did I learn the hard way that [laughs] that is not how the market works. And it's a hard lesson to learn. I'm looking at the current share price of one share of Berkshire Hathaway A, it's the ultimate example. This is a $313,000 stock. One share costs $313,000. And yet, you can actually make a pretty compelling argument today that that stock is undervalued. You wouldn't know that if you only looked at the price of one share, it's about the valuation.
Lewis: Yep. It's all about valuation, and that's why we are going to be taking the market caps of these businesses and then putting them in the context of what they produce for people who own the shares. And so, a couple of different ways to do that, you're going to hear us kick around P/E, you're going to hear us kick around maybe price-to-sales as well, as Brian mentioned before. But just understand, that's really what we're getting at when we're talking about cheap.
With that disclaimer out of the way, Brian, we have four names that we're going to be discussing on today's show. What's the first one that you're going to be throwing out there?
Feroldi: This name is probably familiar to everybody. Intel (NASDAQ:INTC), ticker symbol INTC. This is a $212 billion company. It trades for about $50/share. Again, those metrics by themselves wouldn't indicate cheap, but there's no doubt, if you look at this company's valuation numbers, it's cheap. I think most people know what Intel does. Intel Inside was the brand campaign of the 1990s. If you have a computer at home, the odds are very good that Intel makes the chip that powers it.
Lewis: [laughs] Yeah. They are kind of in everything, right?
Feroldi: Yes. And data centers. PCs have historically been the market that they dominated alongside Microsoft in the 1990s, and had commanding market shares. More recently they have broadened their business into the datacenter market, so if you've heard about massive growth in data centers, that's another market that Intel has held a very strong position, and also has a number of other growth areas that it's getting into, such as, autonomous driving and stuffs.
So, semiconductors, incredibly important technology. Intel has been historically a fantastic investment. Pays a strong dividend, buys back stock, and has made shareholders a ton of money. However, the last few years, the story has taken a turn for the worse and we actually see the company at multi-year lows in terms of valuation. This is a company that's trading at less than 3X sales, that's a five-year low; it has a dividend yield of 2.7%, that's a three-year high and it's also above the S&P 500; and it's trading at 9Xs trailing earnings and 10X forward earnings. Those are cheap numbers.
Lewis: Those are cheap numbers, and Brian, kind of the ones that you would expect for an older business that is a little bit more slow-moving. That's typically what we tend to see with a lot of the names that start trading in that valuation range.
Feroldi: Yeah. I mean, there's no doubt that the hypergrowth days of Intel are over and it's moved over to the mature phase of its lifestyle. But again, semiconductors, they still have plenty of room to grow. If you look forward five and 10 years, do you think computers are going to be more or less important than they are today? How about data centers, you think we're going to have more or less than those today? How about the Internet of Things or 5G or augmented reality? All these are tremendous opportunities for semiconductor manufacturers, like Intel.
However, they've kind of stumbled over the last couple of years. And forever, Intel has been the dominant provider of semiconductor chips. And their archrival, AMD, has been like a shell of what Intel is. That story has changed dramatically over the last year; AMD has really picked up a lot of market share in the datacenter and home computing market. Those two markets are 85% of Intel's revenue. The loss of market share in those two markets is a big reason why the share price has fallen so much and the valuation is so cheap.
Lewis: Yeah. Anyone that follows the tech space has probably come across the name AMD in the last couple of years. It has been [laughs] a ridiculous stock to own over the last five years, a huge performer. Also, one of those stocks, Brian, that kind of winds up in the trader forums online and is a trader favorite. So, it winds up being heavily traded and in a lot of headlines for that reason.
Feroldi: Yeah, it's not a stock that we at The Fool celebrate that much, it's had a very rocky up-and-down, it's a boom-and-bust business, but over the last two years there's no doubt that they have kind of been whipping Intel in the markets that it's supposed to dominate. One of the big reasons why is that Intel's next generation of chips, which are based on a 7nm architecture, were supposed to be out now. AMD actually has launched a chipset that's 7nm that's doing very well. Intel's is delayed, it's not going to be launched until 2022.
The other big negative headline that we've seen in the last year is that Apple has said that they are moving away from Intel, they've had a partnership with them for many years and they're going to be producing their own chips. You add those two things up, it's understandable why investors have fled from the stock.
Lewis: So, with that groundwork laid, Brian, what's the turnaround story here, what's the thesis that makes this a cheap stock that is also an investable idea or maybe a watchlist-worthy idea?
Feroldi: Yeah. I mean, the company is in turnaround mode right now. Again, they have that 7nm chip that's coming out in the next year. The delay of a year definitely is going to hurt this company; however, once it comes out, that should, in theory, allow them to regain some of their lost market share. It's also important to remember that the market that this company is in, the demand for chips is likely to continue to grow substantially, especially as the demand for Software-as-a-Service and cloud computing continues to grow. Remember, Intel dominates the chip market for data centers. And when you sprinkle in opportunities and say, 5G and AI and augmented reality, those are not big revenue opportunities for Intel now, but there's no reason the company couldn't focus on those markets or acquire market leaders in there.
When you combine that with the company's dividend, which is, you know, very dependable, as well as a recent $10 billion stock buyback program, it's not hard to see investors doing OK by buying today.
Lewis: Yeah. And while it has struggled over the last couple of years, I think if you're looking at a company like Intel, where it pays a dividend, it's about a 2.5% yield, so it's not huge, but it's also nothing to sneeze at, you have to factor in total return when you're looking at the business and you're looking at share price appreciation over time, because that's something that you're going to realize if you own the stock. Over the past, three, five, 10 years, it has handily outperformed the S&P 500 because of that reinvested dividend approach. And so, you're getting a nice little kicker there. And it seems like there are still tailwinds pushing this business. It is just a business that needs to navigate some change right now.
Feroldi: Yeah. And this is exactly the kind of company, if you were an income investor or you were a value investor, this is going to be a slow-moving company, but it's still going to be predictable and pump out profits and cash flow even when it's down on its luck. This is exactly the kind of company that you can use valuation metrics on, and you want to buy it when it's at its cheapest and perhaps lighten it when it gets a little bit more expensive. Right now, it's definitely on the cheaper side of its historic valuation.
Lewis: Brian, speaking of dividends, the second sock that we're going to be talking about today, IBM (NYSE:IBM). Maybe a little bit of a surprise for people that have listened to the show this long, I don't know that we've said the name "IBM" on the show in several years.
Feroldi: Incredible, huh! I agree with you, I don't think we've ever talked about IBM. This is a $100 billion company. I think everybody listening at least knows IBM; the company that used to absolutely dominate the tech space. They sold hardware, they sold software, more recently they've gotten into things like consulting, business services, they actually finance some of their products. And this was the dominant tech stock, say, 30 or 40 years ago.
More recently the story has also taken a turn for the worse. They have really been outcompeted by the likes of Amazon, Microsoft, Google, [Alphabet] Oracle, Salesforce. The cloud benefits those companies, but it directly hurts IBM. As a result, this company's revenue and profits have both been on an eight-year slide. Revenue is actually down 23% over the last eight years. And investors have just thrown up their hands. This company is now trading at 1.5X sales; that's a 10-year low. Its dividend yield is, wait for it, 5.5%; that's a 25-year high. And like Intel, very cheap on an earnings basis. 13X trailing earnings, 11X forward earnings. Investors are not expecting any growth at all from this company.
Lewis: Yeah. And as you were kind of giving that overview, Brian, I was thinking back and I was, like, OK, if I was in a time machine and I went back 10 or 15 years and I said, there's going to be a megatrend that creates billions, maybe trillions of dollars [laughs] in value for big tech, everyone's going to need to use it and it's going to be the backbone of how we interact with everything online. Who would you think would be in the best position to benefit from that?
Feroldi: I mean, you would say the big boys, right? You would say the Oracles, you would say the IBMs, you would say the Ciscos.
Lewis: Yeah. And yet, they have been displaced. And I could see how people would look at that and say, well, they missed the boat, you know, why is this a [laughs] management team that I should be too confident in, or just a business that I should be too confident in? And I think that some of that concern is well-placed. There are some things that are going in the right direction or could go in the right direction for IBM though.
Feroldi: Yes. IBM has been transforming itself over the last eight years. Again, its revenue has been on the decline as have its profits; that's a hard pill to swallow. But if you look at IBM today, it is drastically different than it was 8 or even 10 years ago. It's significantly grown its cloud operations. Last year it actually made a $34 billion deal to acquire Red Hat, which is a leading provider of enterprise software. That was a huge deal that bolstered their offering. And today, cloud and cloud products are 30% of this company's total revenue and growing. And they also have plenty of opportunities in
AI, I think most people are familiar with Watson; at least from its time on Jeopardy; data analytics; computer security; and they also sell a lot of high-margin software and services on top of that. The problem is, the growth in all of those things have been overshadowed by their legacy businesses which are just dying.
Eventually, you could see the tide finally turning and Wall Street reevaluating this company to say, OK, it's no longer a dying giant, it's now a new company that could potentially grow. And if Wall Street bought that narrative, it wouldn't take much for this company to produce good returns for investors. I mean, don't forget we saw Microsoft go through a transformation and we've seen Apple's valuation, like, double just in the last year. All of that could be due to narrative change. The same thing could happen at IBM.
Lewis: Yeah. And I think even if IBM is not a watchlist stock for you and you're not interested in a more dividend-oriented investment, there are some really good lessons from this company, particularly when you have a huge chunk of your revenue coming from a very specific [laughs] set of operations, that's awesome so long as those things are going well, you know. If you look back at Apple over the last 15 years, you would say, I'm pretty happy that they bet the farm on the iPhone and saw this wildly successful consumer tech product. But as we've seen over the last couple of years with Apple, if you have any disruptions to the growth story with that segment, it doesn't matter what else is going on. You know, you can release the Apple Watch and it could be a wildly successful operation for any other business, but if you're making so much money from one product and that's what's really justifying your valuation, there are any issues with that, you're going to get hit and it's really hard to turn a ship that's that big with anything that is smaller.
Feroldi: That's exactly right. I mean, if you look at Apple even five years ago, I'm pretty sure the iPhone was 60% or 70% of revenue, now it's below 50%. And what's happened to Apple's valuation since then? The market has significantly bid up the P/E ratio. I think that's because Apple has done a good job of rebranding itself as a service company that has a recurring revenue as opposed to one-time hardware sales. IBM could follow the same playbook, we'll see.
Lewis: We'll see. And one other thing I want to throw in there with IBM is that dividend yield of 5.5% that you mentioned, 25-year high. One of the things you always want to do, if you're seeing a dividend yield spike, is look at that payout ratio and say, am I buying something that is going to continue to be there? The nice thing about a dividend yield of 5.5% is, assuming the share price stays flat, you're immediately getting about a 5% return, which is awesome. In the case of IBM, their payout ratio is about 60%, so while it has spiked, as they've basically, you know, continued their dividend program while the business has struggled, it is still a dividend that they're going to be able to service for the foreseeable future without any problems.
Feroldi: Yeah. And the dividend at IBM is sacrosanct. IBM is one of those companies that would do everything in its power to not have to cut the dividend; and there is plenty of room right now. IBM also spends billions of dollars on buybacks each year, and I could see them easily suspending that activity if they needed to in favor of paying the dividend. So, yeah, I think the dividend is pretty safe, unless something drastic happens.
Lewis: Yeah. All right, Brian, stock No. 3, probably one that's familiar to some Fools out there listening, BlackBerry (NYSE:BB). Another old guard name trying to make the turnaround happen. What's the story here?
Feroldi: Yeah, I can almost hear our listeners groaning [laughs] just by the mention of that name, because in the last two years when I heard BlackBerry, my immediate thought was, pass. Like, this is a company that was completely disrupted, how on earth could this be a value stock? BlackBerry once upon a time owned, "owned," the smartphone market then Google and Apple stole all of it from them and it's been a downward slide ever since. I mean, this company's revenue is down [laughs] 95% since 2012. 95% revenue down since 2012!
It makes sense why this has been a horrific investment over the last nine years and why that company's valuation today is so low. This is a company that trades at 2.5X sales, it's only worth $2.6 billion, and it's trading at 21X earnings. So, yes, earnings. This company actually, believe it or not, has earnings. But this has been a horrendous stock to own over the last 10 years.
Lewis: I can't think of too many businesses that could weather having [laughs] a 95% reduction in revenue and, honestly, still be investable; you know, even be in the conversation of being worth throwing on a watchlist.
Feroldi: And if you want to immediately take a hard pass, I encourage you to just keep listening. Because the BlackBerry of today is nothing like the BlackBerry of eight years ago. Management team has been hyper-focused on reinventing BlackBerry from a hardware maker into a software company, and a software company that excels in endpoint security. Remember that when BlackBerry smartphones, even after the iPhone and Android came out, BlackBerry still had a niche market opportunity in governments and any businesses that security was the No. 1 most important thing. BlackBerry has leveraged that brand name and security into an entirely new business today. And this company now gets -- 90% of its revenue actually comes from high-margin [laughs] recurring sources, such as software. And, Dylan, this company's gross margin has expanded significantly, currently 78%.
If I just came to you and said, software company, 90% recurring revenue, 78% gross margin, you would pay attention. That is BlackBerry today.
Lewis: Yeah, it sounds great. It's also amazing, because I think, [laughs] if you had told people in the future, you know, going back 10 years ago, BlackBerry would have 70%-something gross margin. You'd be like, aren't they a hardware company? [laughs]
Feroldi: You would be extremely confused. But they want to be a leader in anything related to endpoint security. They coined this term, the Enterprise of Things; it's a nice play on the Internet-of-Things. Basically, any enterprise-level device requires security, and BlackBerry wants to be the company that provides the software that keeps all of that up and running. They also have a lot of growth potential especially in the automotive market. They historically have provided the software that keeps the infotainment systems going. They have taken those relationships and they've leveraged them outward to also handle communications and safety. And this company actually has relationships with the likes of Qualcomm, Baidu, Ford, Nvidia, and even the recent electric car IPO, XPeng. They also have plenty of relationships with governments like the government contracts, like the U.S. Air Force, the U.K. Ministry of Defense, the Royal Canadian Mint, etc., etc. In fact, 17 governments have chosen BlackBerry's architecture. There is a business here.
Lewis: There is a business. And I think it's strong for them to leverage what they're good at, and approach people who desperately need that with their systems. You know, if they can go in and basically say, look, you have X number of autonomous vehicles out there, or you plan to, we'll be there. You have this installed base; we'll be there and make sure [laughs] that everything is secure and acts the way that you wanted to. That's very compelling, because none of those auto manufacturers want to have to build that themselves, they would much rather have someone else come in and handle that for them.
Feroldi: Nor do they have the expertise. It makes sense to partner with a company like BlackBerry. Again, the name BlackBerry doesn't mean anything to me and you, because we're consumers. If you're in government and security matters, the name BlackBerry actually has some value. Now, 2020, not exactly a great year for auto sales, so that has weighed on their financials. But moving forward there is reason to believe that this recurring revenue business with high margins can actually get its topline growing again and can pump out free cash flow and profits. If that happens, it's possible that the next 10 years will be far more prosperous than the last 10.
Lewis: [laughs] After the last couple of stocks, people might be used to the idea of some relatively cheap, cheap businesses. You know, we talked about some that are down around the 10 P/E ratio type arena. I'm going to throw a name out there, it might be a controversial name, for stock No. 4, because it is a little bit more richly valued, but valuation is relative, and we can talk about that.
My fourth stock here is Electronic Arts (NASDAQ:EA). And so, like a lot of these other companies, probably doesn't need much of an introduction for people. But the company that makes Madden, FIFA, NHL; if there's a sports game, there's a really good chance that they make it. They also have a UFC line, they have Apex Legends, they have several Star Wars games. They are one of the biggest pureplay video game manufacturers out there. I think, Brian, if you are a gamer, there is a very strong chance that you have an EA title on your console.
Feroldi: I can tell you that my son's a gamer, I'm a gamer. And on our Xbox at home we have Madden and Star Wars Battlefront, so we are EA consumers.
Lewis: Yeah. And I'm guessing that you've been an EA consumer more than once.
Feroldi: Yes. Not my first time buying from EA. God! I've been a consumer of theirs for 30 years almost.
Lewis: Yeah, and me too. I mean, I think back to the PlayStation 2 that I owned and bought with my own money when I was, like, 11. And those early Madden releases that would come out or MVP Baseball, back when they were making that game, and I would pretty much buy it every year because I loved it, and I think that's the value of a business like this.
They are currently about a $35 billion company. They posted about $1.9 billion in net income over the past 12 months; that is padded a little bit by some tax benefits, but they are roughly at 20X trailing earnings. A little bit higher than some of the other things that we've thrown out there, but when we talk about undervalued, the way that I'm looking at this, Brian, is saying, market multiple right now for the S&P 500 is about 28X, this business is below that, and I think it probably has better growth prospects than the overall market.
Feroldi: Yeah, if you look at the other three companies that we talked about, you can make a pretty compelling argument that those companies deserve to be cheap. EA has been in growth mode and video games are an incredibly attractive place for investors to look. The size of the video game market is huge and growing, so this is an interesting value pick.
Lewis: Yeah. And I think that they, in some ways, deserve to be at a lower valuation than maybe some of the other video game publishers, because they haven't had consistent strong results. There was a period in 2019 where they had some pretty disappointing releases. And if you talk with anyone in the gaming space over the last two years, battle royale has taken over as a construct. And I think they were just a little bit late to the game with that style of game, and they had some misses with some of their releases. So, it makes sense that they wound up, kind of, taking a hit with this. If you look at their growth rates over the last, you know, 8, 10 quarters, they've had some ugly quarters in there, [laughs] as they've had to deal with missing that megatrend. They seem to be back on track, though.
And what I like about this business is, they have bankable franchises, Madden, FIFA, all their sports franchises. That's a snap-test type property for me. If they disappeared, people would freak out. They love those games and they love getting them every year. It's also a business that is not disrupted by the pandemic. In fact, it probably benefits from people staying at home, as long as people generally are employed, because they're able to digitally deliver their games and they're able to do everything that they need to do as people from home. In fact, I think people are probably a little bit more willing to spend money on video games if they're staying at home, Brian.
Feroldi: Yeah, we've seen sales of video games take off; it makes complete sense as to why. And one thing that I really like about the video game industry in general is that just because you play or buy from one company, it doesn't mean you won't play or buy from another company. In fact, you could argue that success of any one video game provides a halo effect to all other game makers. I'm playing more video games than ever because of Fortnite, and that has reignited my passion for video games in my house. So, we've gone out and bought Madden and such; so that's something.
These seem like rival businesses, but just because one company is succeeding, doesn't necessarily mean it's at the detriment of another.
Lewis: Yeah. And I'm not even a big-time gamer, but I have an Xbox 360 that I dusted off, found my games for, and have been playing on-and-off over the last couple of months, just because I've been looking for things to mix it up and do something fun. I think there are a lot of people that are probably gaming a lot more than me that are actually [laughs] spending more money and, kind of, buying new titles, but I like the fact that there is a major tailwind pushing this business forward. I think video games are only going to become more and more relevant over time.
And looking at the financials for this business, 75% gross margins, $6 billion in cash and equivalents, $400 million in long-term debt. So, this is a business that has a ton of flexibility, they're in pretty good shape financially. They have posted double-digit revenue growth for the last couple of quarters after struggling for a while. I think with folks staying at home, that's probably going to continue.
This isn't maybe one of those super-high-growth companies that we often talk about, Brian, but I think it's kind of a nice blend of a business that clearly has some greenfield ahead of it, that really isn't being properly valued by the market right now.
Feroldi: Yeah, and one other thing that I've really liked about the video game industry over the last couple of years is the switch to selling directly to consumers and going more toward an in-app purchase model as opposed to a one-time upfront cost model. We've seen, historically, that when huge titles come out, these companies get a bonanza of revenue if it's a blockbuster. And then that makes it incredibly challenging to grow the next year by switching over to a low-cost or upfront, giving away these games for free in many cases, and then you buy things in the game. It just completely changes the revenue dynamics of the companies.
Lewis: Yeah. And it expands the ability to monetize games that you do have to pay for, you know, if you have something where you pay for the title but then you have upgrades within the game. There are some people that love that and they want to do that, that's another revenue source, and another way for them to improve the experience for some of the hardcore gamers out there. So, I just think there's a lot that's going in the right direction for this business, and it's certainly worth throwing on the watchlist.
Brian, four names, how are you ranking these four personally in terms of preference?
Feroldi: Okay. Well, for me EA is the number one, definitely. EA is a high-quality business that has huge tailwinds behind it, and it's cheap temporarily, in my opinion. I think the next 10 years are going to be great for almost all video game companies, and EA is certainly in there.
For No. 2, I would probably go BlackBerry, believe it or not. Even though this has been a [laughs] horrendous stock in so many ways. I think the business today is just so drastically different. And again, 90% recurring revenue, and 78% gross margins, it's easy to have a successful business when you have those two things going for you.
And then with the No. 3 and the 4. I would probably go, Intel, 3; and IBM, 4. I think Intel's woes are fixable in the next year or two. I wouldn't count out IBM, and its dividend yield is really high. But yeah that would be 1, 2, 3, 4 for me. How about you, Dylan?
Lewis: Yeah, I think I'm relatively similar. What I would say with BlackBerry is, it probably is in some ways the longest bet out of these four stocks, but I think the upside is probably the biggest. And so, you know, if you're thinking more dividend-oriented, Intel and IBM would be probably at the top of the list for you. But I would go EA and BlackBerry because of the growth opportunity. And then, probably, take a pass [laughs] on IBM and Intel, mostly just because over the last couple of years, I've been focusing a little bit less on the dividend payers and looking more for growth opportunities. And I think both of those businesses really do have some attractive growth opportunities in front of them.
Feroldi: Fair enough. I mean, I myself am focused on awesome businesses, first; growth, second; and income, last. So, like you, none of these are going to be top of my watchlist by any stretch of the imagination, but if you are a value investor and you dabble in tech, these are definitely four companies worth checking out.
Lewis: Yeah. I think, importantly, Brian, we need to prove to listeners that we are capable [laughs] of talking about companies that weren't trading at 40X sales and up.
Feroldi: Right. I mean, geez! Some of these companies are under 3X sales, talk about a bargain, right? [laughs]
Lewis: [laughs] That's awesome. Don't worry, folks, we'll be back with our high-growth businesses sometime in the near future. Brian, thank you so much for hopping on today's show with me.
Feroldi: Have a good weekend, Dylan.
Lewis: Listeners, that's going to do it for this episode of Industry Focus. If you have any questions or you want to reach out and say, "Hey!" shoot us an email over at IndustryFocus@Fool.com, or tweet us @MFIndustryFocus. If you want more stuff, subscribe on iTunes or wherever you get your podcasts.
As always, people on the program may own companies discussed on the show, and The Motley Fool may have formal recommendations for or against stocks mentioned, so don't buy or sell anything based solely on what you hear.
Thanks to Tim Sparks for all his work behind the glass, and thank you for listening. Fool on!