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2 Stocks With Tremendous Long-Term Potential

By Matthew Frankel, CFP® - Updated Jun 22, 2021 at 2:37PM

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Here are two stocks that could be worth a look for patient long-term investors.

Every week on Industry Focus: Financials, host Jason Moser and contributor Matt Frankel, CFP, each mention one stock they're watching. In this Fool Live video clip, recorded on June 7, hear why the pair are very interested in potential home-run stocks Latch (LTCH 4.00%) and Cannae Holdings (CNNE 1.60%)

Matt Frankel: I am watching Latch and I can say just Latch now because they finally completed their SPAC deal. Latch, if you remember, we had CEO Luke Schoenfelder on our show not that long ago. Latch was acquired by a SPAC called TS Innovation Acquisitions. It was Tishman Speyer's stack. They just went public today, which is very significant because it means they now have access to the $450 million they were getting in that SPAC deal. Now they're going to have really deep pockets. They've recently announced that they expanded into commercial offices. They're pretty much in apartment buildings. They provide an apartment building operating system for the most part. That's their core business. They're expanding into office buildings. They are trying to expand into the Europe market, which has about double the rental housing units of the United States, by the way. Now they have the cash to really take on that market head-on. I'm really watching that one, the stock is actually down since the original spark merger was announced. They were discussing their first-quarter business results on Wednesday, so I'm going to be paying attention to that. I own shares of Latch now. It's interesting to say Latch trades under its own ticker symbol, it's LTCH. That's one I am watching very closely.

Jason Moser: Good stuff. I am going to be watching a company called Cannae Holdings, ticker is CNNE. Ever heard of Cannae Holdings, Matt?

Frankel: I have not.

Moser: This one was new to me as well, we had a listener who had asked a question for Market Foolery and Chris and I talked about it one day. The more I dug into it, just a very interesting company with an interesting history. It split off from Fidelity National Financial back in 2017. It's not a SPAC, but it is a business. You talk a lot about how management really is the key. It does feel like management is the key here for Cannae as well. Bill Foley, who actually is running the show, he owns around 3.7% of the business today. He's got some skin in the game. He is, I believe, the executive chairman and the one generally speaking, calling the shots there. Ultimately, it's a company that takes meaningful equity ownership stakes in businesses that they see opportunity. They own everything from shares of Dun & Bradstreet, which is data analytics, to a large collection of restaurants. They have fintech and the company called Paysafe. They even have real estate in a golf course community, Matt, so just a lot of different investments there that fully is made through the years, and over the course of the last three years, the stock has done well and it's returned better than 80%, outpaced the market. Just an interesting business. The question was in the line of is this the kind of Berkshire Hathaway-style investment minus the insurance operations? I think there's something to that. It's one that I am going to dig into, learn a little bit more about just because it was a new one for me and interesting and it could be an opportunity for investors. So we'll keep an eye on Cannae Holdings.

Jason Moser has no position in any of the stocks mentioned. Matthew Frankel, CFP owns shares of Berkshire Hathaway (B shares) and Latch, Inc. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). The Motley Fool recommends Latch, Inc. and recommends the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), short January 2023 $200 puts on Berkshire Hathaway (B shares), and short January 2023 $265 calls on Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy.

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Stocks Mentioned

Fidelity National Financial Ventures Stock Quote
Fidelity National Financial Ventures
$23.51 (1.60%) $0.37
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
$452,697.25 (1.66%) $7,395.26
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
$301.55 (1.71%) $5.08
Fidelity National Financial, Inc. Stock Quote
Fidelity National Financial, Inc.
$41.00 (1.66%) $0.67
Latch, Inc. Stock Quote
Latch, Inc.
$1.30 (4.00%) $0.05
Paysafe Group Plc Stock Quote
Paysafe Group Plc
Paysafe Limited Stock Quote
Paysafe Limited
$2.06 (0.49%) $0.01

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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