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In this week's episode of Motley Fool Money: Earnings-palooza! Chris Hill is joined by Motley Fool analysts Jason Moser, Ron Gross, and Andy Cross to bring you the latest news headlines and earnings reports from Wall Street. They've got some trillion-dollar companies' earnings reports to go through, they've also got cloud businesses, social media, coffee chains, and fitness and consumer goods companies. They share some stocks to put on your watch list and much more.

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.

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This video was recorded on October 30, 2020.

Chris Hill: Alphabet's third quarter profits came in much higher than expected, Google's online ad business continues to do well, revenue for Google Cloud was up, and YouTube revenue topped $5 billion.

Jason Moser, a lot to unpack, what stood out to you?

Jason Moser: You know, I think, generally speaking, the thing that stood out to me, this was a nice recovery from what was a pretty ho-hum quarter last quarter. You know, much like Facebook (NASDAQ: FB), Alphabet continues to benefit from this massive move from offline to online, and kind of harkens back to Satya Nadella's quote from back in April where he said we've seen two years' worth of digital transformation in two months. And Alphabet, certainly, one of the companies helping spearhead that and benefiting from it as well.

But 15% topline growth is very, very encouraging. They had nine services with 1 billion users each; I mean, it's just amazing to really think about it. But to your point, a lot to unpack there, Google Cloud continues to perform very well. They had ended the previous quarter with a backlog around $15 billion, and for this quarter they brought in revenue of $3.4 billion, it was up 45%. Clearly, well behind Amazon (NASDAQ: AMZN), and AWS, but they're picking up share, which is encouraging.

To YouTube, YouTube ad growth was really strong. It was up 32% from a year ago; nice recovery. Last quarter, if you recall, they chalked up about 6% revenue growth, and that was due to some weakness in brand advertising. That brand advertising is starting to come back, and certainly, YouTube has benefited from that.

So, all things considered, this is a business that has a lot of different ways to win. An interesting little factoid -- a couple of factoids from the call I just thought that were, kind of, noteworthy. They said, as the sign of the times, views for guided meditation videos are up 40% since March. And DIY facemask tutorials have been viewed over 1 billion times. So clearly, they are seeing themselves [laughs] as part of the solution, as opposed to part of the problem, and I think that's good, investors should be happy. [laughs]

Hill: I'm not a shareholder, but that just makes me happy. [laughs]

Moser: I am a shareholder, and yeah, it makes me happy too, Chris. [laughs]

Andy Cross: I got to go over there and look at some of those videos, because I can never get those masks on properly, so.

Hill: Microsoft's (NASDAQ: MSFT) first quarter profits and revenue came in higher than expected, but guidance for the second quarter came in low, and shares of Microsoft are down more than 7% this week. Andy, I get the short-term concern of [laughs] people on Wall Street, but this is such an impressive business.

Cross: Chris, absolutely. The sales growth of 12% was, I think, really respectable and higher than expectations powered by its cloud business, not to be forgotten, its office and the productivity segment did really well. Hello, Teams continue to show lots of rapid growth. And the cloud expectation growth coming for the next quarter, up 6% sequential, I think is what people focus on, but just looking at the quarter, Chris, sales are up 12%, now $37.2 billion for the quarter; that productivity and business process business, that's like Office 365, LinkedIn, the Dynamics business, that was up 11% in sales, much better than last quarter, the intelligent cloud business was up 20%. That was up versus the 17% growth in the fourth quarter. The Azure business, that's their big cloud business, that revenue was up 48% among that division; that was an acceleration off last quarter, so that acceleration, I think, may not be continuing as much going forward, I think that's what sent some investors a little bit worried, and sent the stock down.

The operating income, Chris, continued to really grow. I mean, that operating income in that Cloud business itself was up 39%; that helped drive overall growth, because that's now such a large part of their business. The gross margin was up 15%. The operating income was up 25% overall. That drove EPS growth really healthy up more than 30%. So, overall, looking at the quarter, Microsoft continues to do really well. And their game revenue; can't forget about the gaming revenue, up more than 20%. Xbox Game Pass now has more than 15 million subscribers.

So, across the board, when you look at all of the businesses, for the most part, Microsoft is doing really well.

Hill: Shares of Amazon down a bit this week despite the fact that third quarter revenue came in at a record $96 billion. And Jason, I'm pretty sure that record is only going to stand [laughs] for a few months, because the Amazon holiday quarter is just around the corner.

Moser: It is, it is set up for success, that's for sure. You got 37% topline growth for the quarter, which, you know, you couple that with the 40% topline growth that they recorded just last quarter, I mean, it's really, it's still Amazon's world, right, we're just living in it. I mean, this is just a business that continues to perform so well in so many different ways. And to your point on the holiday quarter, they're going to enjoy their first +$100 billion quarter this holiday season; that's just going to be phenomenal to think about there, and how well Jeff Bezos continues to invest that capital, reinvest that capital back into the business.

Looking at Prime Day, that wasn't something that was reflected in the quarter's results, but Prime Day, we know, generated more than $3.5 billion in sales for the small- and medium-sized businesses on its marketplace; that was up 60% from a year ago.

Speaking of Amazon Web Services, another strong performance there, 29% revenue growth, operating income was up 56% for AWS. Operating margin for AWS was up better than 5%; that's now a +$45 billion annualized run rate business, it's still growing like a weed. So, just a lot of different ways for Amazon to win and they continue to execute.

Hill: Let me go back to Prime Day for a second, because we talked on this show a few weeks ago, going into that week when Prime Day was happening and Apple (NASDAQ: AAPL) was having their event to unveil the iPhone 12. And I think as a group, we said Amazon has got a little bit more on the line here, because they've had some bumps in 2020, they need to execute well. It now looks like it really was a test run for them, I mean, they spoke to that a little bit on the call. And for anyone concerned about Amazon packages going to get to me in time for the holidays, they appear to be doing everything they can to make sure that's the case.

Moser: Yeah, they are. I mean, they did note that costs are going up. I mean, a lot of that is COVID-related, but nevertheless, they are spending a lot on this business to, sort of, deal with this new paradigm, so to speak, and the fulfillment logistics challenges that come with that. So, I think you're right, I think they are set up for success this holiday season from a fulfillment perspective. I think the bigger concern, really, is going to be from a volume perspective, the supply. I mean, are they going to have everything that everybody wants? That could be the crimp, so to speak.

And again, I think the general recommendation for folks out there, don't wait 'till the last minute, I mean, Amazon is wonderful, but don't wait until the last minute, because it's going to be a challenging season for everyone. [laughs]

Hill: Pinterest (NYSE: PINS) is nowhere near a $1 trillion company, but shares were up more than 25% on Thursday after a blowout third quarter, revenue was up, monthly active users, revenue per user. Andy, pretty much everything you would want to see, if you're Pinterest shareholder, was up this quarter.

Cross: Chris, if there's a better reported quarter, I haven't seen it. I mean, this is just really impressive. Revenues skyrocketed 58%, and that was just versus the 30% growth that they had guided themselves last quarter. Monthly active users jumped 37% now to more than 442 million versus 416 million last quarter. In the U.S. the revenue was up 49%. The monthly active users in the U.S. was up 13% compared that to the growth in international, which was up 46%, international continues to be the big volume driver, but revenue per user is really driven by the U.S., but that was alone was up 31% versus the growth on the international side of 66% on the per user side. So, the profit picture really improved too, their non-GAAP operating income was $84 million versus -$3 million a year ago.

So, overall, they continue to drive a lot of interest in the Pinterest platform as more and more users are migrating there to be inspired by the visual representation there. But what Pinterest, the business, is doing in there, innovation on linking in their shopping, their auto-bidding feature now makes advertising a much more seamless for those small- and medium-sized businesses that now are relying more on Pinterest. And overall, just a really nice quarter, and the company continues to innovate and take advantage of the usage that is exploding on their platform.

Hill: Shares of Facebook falling 7% this week. Third quarter revenue grew 22%, but Facebook's users in the U.S. and Canada, Ron, they actually fell a bit.

Ron Gross: Yeah, and they expect that to continue into the fourth quarter, which is interesting. But as you said, overall things looked pretty strong with the revenue up 22%. Interestingly, that July advertising boycott, you recall, really didn't have much impact. This company is largely reliant on millions and millions of small businesses, so you know, while there was some headline news there, it didn't really seem to make much of an impact on revenue. The shift to e-commerce this year has led to increasing demand for advertising for sure. 2.74 billion monthly active users for Facebook; that's up 12%. Now, total expenses are up significantly, they're up 28%. Their cost is continuing to grow as they invest in infrastructure, which includes R&D. Their headcount is up 32% this year, legal expenses, they've got a lot of stuff going on, up 33%. So, that took a bite out of what would have been a pretty strong bottom-line. A lower tax rate helped them get an earnings boost of 28%, but if we strip that out, operating earnings only up 12%.

Now, I think what investors are focusing on from a stock perspective is the warning for what they're calling a tougher 2021. They see significant uncertainty, citing privacy changes by Apple, regulatory environment in Europe, increased expenses for many of the same reasons that we just discussed, including headcount and getting people back into the offices once the pandemic starts to wane. So, they're expecting a marginal decline as a result. And it looks pretty clear to me that investors are not happy about that.

Hill: Shopify's (NYSE: SHOP) revenue in the third quarter was nearly double what it was a year ago, and yet, shares down around 10% this week. Andy, I get that Shopify has been on fire lately, so over the past year this stock has been amazing. This was a great quarter.

Cross: It was, Chris. I think that just the curse of expectations with a company like Shopify has done so well. As you mentioned, revenues up 96%, almost a double. Subscription sales up 48%. Their merchant sales, which are things like their payment fees, their shipping fees, Shopify Capital did more than double, up 132% now, $522 million.

Their gross merchandise volume, so all the volume across the Shopify platforms, did double. It was up a 109%; that was a little bit of a deceleration, Chris, from last quarter at 119%. But it is above their pre-COVID level, so they're already back there. So, when you look at the kinds of merchants that Shopify continues to add to its network, add to its platform, and the solutions, importantly, that continues to evolve. I mean, Jason had talked about Amazon preparing for the heavy holiday shipping. Certainly Shopify, now with 6% of the e-commerce market, the second largest behind Amazon, is preparing for that. They're really working on building out their fulfilment network.

And they have these new initiatives with TikTok and Pinterest. More than half of eligible merchants now use Shopify Shipping, that's up from 45% last quarter. So, the profit picture is impressive. When you continue to look at the scale that they're building out, but there's just some expectation with a company that has delivered so much, so fast with Shopify that it looks like investors may be taking a little steam out of the stock, but overall, a really nice quarter from the Canadian company.

Hill: Apple shares were down more than 5% on Friday. Apple's fourth quarter profits and revenue came in a little higher than expected, but iPhone sales weren't exactly lighting the world on fire, Ron.

Gross: Yeah, not so great. Sales in Greater China were down 29%; that's the lowest since 2014. And that's largely the result of the delayed launch of the iPhone 12. Now, total revenue was up slightly, about 1%, which the company was quick to point out isn't that bad considering there were no new launches during the quarter. So, not too bad. Total product revenue down 2.7%, driven, as you noted, by a 21% decline in iPhone revenue. But some bright spots, Mac revenue up 29%. iPad, up 46%, as more people are using them for at-home learning. Service revenue up 16%. Wearables up 21%. So, some strong numbers there. And I would expect to see the iPhone regain their growth now that the iPhone 12 will begin to sell in November.

Gross margin is up a bit, but operating expense is up 14%, so that actually led to a 3.9% decline in earnings per share. So, a decline in profits from Apple. No forecast for the holiday quarter, investors are not happy at all with that, but you know it's still a wonderful company generating gobs of cash flow. $192 billion in cash. And let's not forget that the Apple One subscription is launching today, which bundles Apple Music, Apple TV+, Apple Arcade, Cloud Storage, starts at $14.99.

Hill: It is interesting to see the ripple effect, as we've seen over the past few months more companies reinstating dividends, increasing dividends, companies starting to give guidance. It is still a little jarring that a company as big as Apple and a CEO as experienced as Tim Cook says, nah! I'm not giving guidance for Q1.

Gross: Yeah. I guess the holiday quarter is such an important quarter, and so investors are even more upset to not receive guidance for that versus, let's say, a mundane second quarter. [laughs] But he's sticking to his guns and we'll just have to wait and see how they look.

Hill: Starbucks (NASDAQ: SBUX) wrapped up the fiscal year with a better than expected fourth quarter report, and what that means, Andy, is that same-store sales in the United States were only down 9% and comps [laughs] in China were only down 3%. I shouldn't poke fun. Like, this is legitimately better than people were expecting, and it's amazing to me that Starbucks' shares have held up through 2020, the extent to which they have.

Cross: The bucks is on its way back, Chris. I mean, sales were down 8%. Global comps, compatible store sales down 9%. But that's an improvement from the down 40% last quarter, Chris. Down 23% in transactions; that was lower than the last quarter, which was down -51%. Average tickets are still up 17%. And that was down from up 23%. But as you mentioned, Chris, it was versus the 12% to 17% drop they had estimated for the global and U.S. combined comps.

And overall, you look at the way that Starbucks has really tried to rebound from this, they've opened 480 new stores, that includes 40% growth, and now have almost 33,000 total stores. Their loyalty card, 90-day active members in the U.S. is up 10% to 19.3 million now. They increased the dividend by 10%, Chris, their channel development business was up 17%; that's ahead of the market growing 9% in that business overall. Their ready-to-drink business, those solutions up 15%. Their guidance for the next fiscal year for the global comps was 18% to 23%.

So, overall, looking at the way that Starbucks has rebounded from this, their learnings in China, getting on top of it. They just thought that this -- I look at this quarter and say, you know, it's not over, they're definitely not out of the woods yet, Chris, but really operating very nicely. They're going to be very judicious in how they open up their stores, being very careful, they are going to close a bunch, even more than they thought so in the metro markets that are a little bit more dense, they're really underperforming.

So, when you look at their investments they're making, the way Kevin Johnson and his team have managed this business and rebounded from those lows, which were just really drastic earlier in the year, it's been a nice rebound for Starbucks.

Gross: Andy, I know my family is single-handedly responsible for the increase in sales of pumpkin bread, but are we the only folks eating food at Starbucks, is the food business at Starbucks going to be hurt by the model going forward?

Cross: It has. I think it already has, it's really the coffee business. As I mentioned, the trends -- as we can now go, and I've done this, if you want more coffee and more drinks, you kind of load up, so the transactions, the volume of transactions are down, but when you go there, you spend more on, but I think that's mostly on the coffee business and really talking through how they're continuing to innovate and serve those clients. And now mobile orders are a full quarter of total sales. And that's up really nicely over the past year.

Hill: Twitter's (NYSE: TWTR) third quarter profits and revenue came in higher than expected, but user growth is slowing, and shares of Twitter were down 20% on Friday.

Jason, for anyone wondering, if this is an overreaction, it's probably worth pointing out that Twitter's business has never really earned the benefit of the doubt.

Moser: I agree with that totally, [laughs] actually. And you know, I used to be a little bit more bullish on Twitter; these days I am certainly a bit more bearish and for a lot of reasons. I think ultimately Twitter has a growth problem, right, and reframing the user metrics can't hide that. And that's what they did when they went to those monetizable daily active users. I do agree that Twitter is a daily use platform, that that metric is more relevant, but when you look at the raw numbers, compared to other competitors in the space, I mean, it's clear as day. You get Snap with somewhere in the neighborhood of 250 million, Pinterest at 442 million. Twitter sitting there with 187 million daily active users, I mean, sequential growth was basically nonexistent.

And the revenue growth shows it too. If you see, users were up year-over-year, now, not sequentially, but year-over-year users were up 29%. Revenue only grew 14% and that's a problem, and I think one of the concerns is that they continue to invest in their ad-tech and they continue to delay rolling out this new ad-tech, these new features. In this direct response market that is such a big opportunity, they're not really able to participate in it to its fullest, because they just continue to move so slowly.

And then, you've got the whole other issue there of becoming more consistent with their community guidelines and policies. I mean, they can't offer up certain guidelines and standards to then only act another way and then apologize for it later saying it was bad judgment, it's a constant state of confusion there and they need to figure that out. It does feel like one of those features that they rolled out, the Topics feature, which I know that it could be a little bit of a hot button issue for some people, it did reach 70 million users by the end of the quarter, and that was up 40% from a quarter ago.

So, maybe that's something that could be sustainable and monetizable, but that remains to be seen, regardless they continue to just move so slowly, they have so many things to figure out, it's not a very encouraging picture these days.

Hill: Well, that was something you and I were talking about earlier in the week, because we're both pretty active on Twitter. I remember just asking you on the side, like, hey, they keep pushing this Topics thing, is there a way to shut that off? And you're like, no, I don't think there is. And then, when we got the quarterly results and, you know, the growth that you mentioned, I thought, oh, that's what -- [laughs] it's like, OK, I find it annoying, but from a business standpoint, I completely understand why they're doing it.

Moser: Yeah, I do too. And I guess the question is, will it be sustainable? I mean, it's one thing to try it, it's another thing to continue to use it. And then, you look at just [laughs] the overall environment on Twitter, it is becoming a very toxic place. Unfortunately, it's so levered to politics, which is really just not a great place [laughs] to be right now. And so, I think that, you know, they have a lot to clean up there on the platform and on the user side. And unfortunately, because they're so levered to politics, ultimately, it's just going to make half their user base feel alienated, which is going to, obviously, impact that user growth. So, I don't know that expecting any user growth is really a reasonable expectation at this point, and that's going to be a real drag on the business for sure.

Hill: Signs of life from Under Armour (NYSE: UA) (NYSE: UAA), third quarter profits and revenue were higher than expected, and the company sold its MyFitnessPal platform for $345 million. And yes, Ron, that is less than Under Armour paid for it five years ago, but as a shareholder, I feel like they're making progress.

Gross: Buy high, sell low. Is that the goal; [laughs] is that the mission? You know, revenue was flat here, which is actually a good thing, and it is better than expected. Online ordering, not the physical stores, drove that beat. Direct-to-consumer, up 17%. Wholesale and store retail was weak, and they're attempting to really deemphasize physical stores to the point that they can. They're going to reduce some North American distribution points, they're going to try to cut 2,000 to 3000 distribution points, which will end them with about 10,000 still existing by 2022.

We saw strength in footwear, up 19%; accessories, up 23%, I think that's likely reflecting the trend of folks exercising more at home. Apparel, a little bit weak at 6%, even though lots of us are likely looking to get comfy while we work at home. Gross margins were down, product mix was largely the cause of that, including COVID expenses. The company has had $550 million of restructuring and impairment charges so far this year; $74 million just in the third quarter. So, right there, that kind of gives you an indication of how this business has been run. Not great.

They were slightly profitable. Adjusted net income of $118 million. And as you said, they'll be getting some cash in the door through the sale of the MyFitness app as well as the Endomondo platform, which they're selling for $85 million as well.

Hill: Etsy's (NASDAQ: ETSY) third quarter report was impressive on the top- and bottom-lines, but shares falling more than 10% this week, in part because expenses are also rising for the specialty retailer. Jason, CEO Josh Silverman says this is the perfect moment for Etsy to make big investments in marketing. Do you agree?

Moser: Yeah, absolutely. I think he's certainly walking the talk. Etsy is playing some serious offense these days. And the good news is for them that it appears to be working like a charm, as they continue just to smash their own internal expectations. To your point on the marketing spend, they ended the third quarter with consolidated marketing spend of $127 million; that was up 153% from a year ago. I mean, that is just amazing, the willingness to spend on this business, but it is working. They brought in gross merchandise sales of $2.63 billion for the quarter; that beat their own guidance, which was a range of $2.2 billion to $2.5 billion. Revenue of $451 million, and adjusted EBITDA of $151 million also beat internal expectations.

They now have 3.7 million sellers, that was versus 3.14 million a quarter ago, and 69.6 million buyers versus 60.3 million a quarter ago. Etsy Payments and Etsy Ads continue to drive revenue as well. I wouldn't be worried about the sell-off in the stock price, I mean, it's had a good year, and it's a business that continues to really, really impress. I think that even as we get past this pandemic, this is going to be a company that just continues to see many bright days ahead.

Hill: The stock of the week is Tupperware. Yes, Tupperware. Third quarter profits were 3X higher than Wall Street was expecting. Shares are up 45% this week. And Ron, in the Spring this thing was just over $1/share and now it's around $30.

Gross: So, you're telling me it's not only technology stocks that go up? [laughs]

Hill: This is not cloud Tupperware or Tupperware-as-a-Service, this is just Tupperware.

Gross: [laughs] This is actually a very interesting turnaround story for people who have not followed it; and I think that's most of us. And it's also helped by everyone significantly eating more at home, so you have a turnaround plus the impact of COVID. So, the turnaround plan includes a new CEO, a new executive team, they're paying down debt, they've been over-levered for quite some time, they're improving their cost structure, they're selling noncore assets, including real estate. And then you have the benefits of what just took place in the quarter. So, your sales are up 14%.

And you have to remember now that this is still largely a registered rep party plan model, the old Tupperware party still is in existence. Their average sales force was up 10%, active sales force. And the sales for active sales force was up 10% also, so those two things compound to, kind of, really boost some nice growth.

Management highlighted new digital tools that reps are using to sell the products in these crazy times. All regions were up, except for Asia Pacific, which was down 6%, but North America clearly the highlight, up 42%. They delivered $60 million in cost savings during the quarter, and that led to a [laughs] 233% increase in earnings per share. Not too bad.

Hill: Let me ask the question that I would be asking if we were talking about a SaaS stock or a cloud stock. It's up more than [laughs] 25X in value since the Spring, is this an expensive stock at this price?

Gross: Hey, you know what, I think it's only trading for 9X EBITDA, if memory serves me correctly, which it is not an expensive stock in that regard, but they have to keep turning this business. I'm not sure I love the continuation of the party planning model, they might want to think of a more multi-distribution in a bigger way, but [laughs] it's not that expensive, no.

Hill: Chris Hill here with the entire crew, Jason Moser, Andy Cross and Ron Gross, all together for the homestretch, guys. Guys, on last week's show we talked about the latest earnings from Netflix. And, Ron, I asked you if you thought they were going to raise prices. And honestly, I wasn't even that objective, I framed it as, they're not going to do this, are they? It was one of those things, like, if it was a courtroom, the other lawyer would be like, I object, he's leading the witness. It turns out we were both wrong, [laughs] because we said, no, they're not going to raise prices. And this week Netflix [laughs] announced it is raising prices. Its most popular plan is going to go from $13/MONTH to $14/MONTH. The premium plan goes from $16/MONTH to $18/MONTH. They got pricing power, Ron, and they're wielding it.

Gross: I am surprised that they chose to exercise their pricing power during a pandemic when everyone is stuck at home looking for something to do, it doesn't actually sit right with me, to be honest with you. But, yeah, they can do it, we'll see how it impacts subscriptions. If it does, it probably won't, it's not an incredibly large hike, it's only been about a year-and-a-half, I think, since their last increase. They've had five hikes in six-and-a-half years, so maybe we should have realized that one was overdue, but just because of the times we're living in, it did take me by surprise.

Hill: Andy, it's going to be interesting to see when the next one is coming, because at some point today they got to go over $20/MONTH.

Cross: Well, it's not like they have, you know, any obligations to pay for over the next few years, the content is streaming, so they got $19 billion in due. So, yeah, I think this is just a little bit more evidence of what they think they can raise from a pricing power perspective. I think they have lots more room to go when you look at the competitive landscape out there and the price that they're charging. And as long as they continue to innovate and get their people paying more and watching more movies, I think it's a good thing.

Moser: I would also just say, I mean, I agree with you, Ron. It does seem like odd timing; I'm not necessarily in agreement with them on that. But it's also, to Andy's point [laughs] about the obligations, just do a little bit of the back of the envelope math when you get a chance and recognize the fact that a bump of $1 in subscription charges isn't going to make really much of a dent in the obligations that they owe. I mean, they owe a ton of money, and that's always going to be the case, because they have to keep on producing all this content. So, it is going to be something that, I don't know, it feels like it's never going to end, they're going to run into a wall eventually, but I think expecting these types of price increases for the foreseeable future is reasonable.

Hill: Real quick while we're on the topic of streaming. We didn't get to Comcast's quarterly report, but, Jason, the thing that stood out to me, Peacock has more than 20 million signups already; that's a pretty good start they're off to.

Moser: It's a great start. I think we all had a little bit of fun with it when they were launching it, [laughs] maybe that was more centered around the name than anything else. But, hey, really, you know what, it's a lot easier to understand the brand there with Peacock then all of these different HBO iterations and, you know, CBS' efforts at rebranding and whatnot. Listen, I tried Peacock, I'm impressed with it. I'm in the middle of watching Mr. Mercedes on there now -- well done, by the way, I think the books were better, but still a good show and it's a good experience, so hats off to them.

Gross: And Netflix has to realize that it's been a long time since they were the only game in town, and there's a lot of good streaming services out there battling for our dollars. So, I would just say, be careful of how often you raise those prices.

Hill: Real quick before we get to the stocks on our radar this week. I don't know if you heard, but there's a Presidential Election here in the United States next week. Let's just go around the proverbial table real quick. And Ron, I'll start with you.

For anyone who is looking at their portfolio and thinking about investing around the election, what's one piece of advice you'd give?

Gross: I would say, stick to your knitting, just because it's election season it doesn't mean you should be doing anything different. I haven't made one move that's directly related to the election. We're going to see different policies depending on who wins, different taxes, different regulatory environments, buy great companies, hold them for the long-term.

Hill: Jason?

Moser: Yep. I think that the best action is often inaction, don't fall for any kneejerk reactions, look back at the history of Presidential administrations and understand that markets go up, they go down. I mean, however this shakes out, just don't do anything rash.

Hill: Andy?

Cross: I almost have nothing to add to that great advice, but I guess I will say is, you can expect a lot more volatility, both not just next week, but I think going forward, so you want to make sure your portfolio is ready for that and have a watchlist, have a buy list ready to go if you have some cash sitting on the sidelines you want to put to work; I think, over the next few months you're going to get some better prices.

Hill: By the way, if anyone listening is a member of any of The Motley Fool services, you can go to Election.Fool.com for more insights and analysis now and throughout next week. And if you're not a member of any of our services and you want to check out our flagship service Stock Advisor, get stock recommendations from Tom and David Gardner, their Best Buys Now and a lot more, you can go to RadarStocks.Fool.com. Get a 50% discount, because you are one of our dozens of listeners.

Let's get to the stocks on our radar. Our man, Steve Broido, is back where he belongs, behind the glass. Ron Gross, you're up first, what are you looking at this week?

Gross: I recently started looking at Wix.com, WIX. It's a Stock Advisor rerecommendation back in August, they're a do-it-yourself website builder platform, make it easier and cheaper to create a website with really no design or coding experience needed. Both of my kids have used them to create websites, which is really what got me interested, and I must say it was pretty easy. They've got a bunch of things going for them. There's no upfront cost if you want to create a website, but they do have almost 4 million paying customers as well. Trends in social media and e-commerce are only adding to the growth in this business. Both Co-Founders are still really, really involved. And they have a new high-end service which puts them up against Shopify. So, I need to dig into a little bit more on that, because that sounds either like an opportunity or a risk, and I'm not sure which yet.

Hill: Steve, question about Wix?

Steve Broido: Sure. It seems like Wix popped out of nowhere. It was Squarespace and then Wix just out of nowhere. If you just advertise enough, can you become the big dog?

Gross: They've done a good job. Their platform is very strong, and the growth, you know, has followed along.

Hill: Jason Moser, what are you looking at?

Moser: Yeah, a company I've talked about here on the show a couple of times maybe, Inphi (NASDAQ: IPHI), ticker is IPHI. We saw the news this week that Marvell Technology will be acquiring Inphi, unfortunately. I was actually looking forward to letting this company do its thing for a while, but Inphi consider themselves in the bandwidth business, right, via its semiconductor components and optical subsystems. And so, Marvell sees this as a great 5G play. I do agree, it's a great 5G play; that's why I liked Inphi so much.

The deal is going to be financed, though, with a combination of cash and stock. And all-in it values Inphi at around $163/SHARE. So, you see, obviously, it's trading well below that right now, as we see oftentimes when a stock is a part of compensation there. So, there probably are some arbitrage opportunities for investors, we don't typically recommend that course of action though, but nevertheless, we'll be keeping up with it to see if this is a deal that actually ends up going through; it looks like it will though.

Hill: Steve, question about Inphi?

Broido: You bet. Will 5G replace my home internet service? Will I be wireless all the time?

Moser: No. I mean, it'll be part of the overall solution, though. We're looking at all sorts of different ways this technology is going to play out. 5G will be a part of it, you've got WIFI 6, that's going to be a part of it as well. And then, hey, Steve, by 2030, we're going to be talking about 6G, so just hang in there. [laughs]

Hill: Andy Cross, what are you looking at?

Cross: Steve, I'm looking at EPAM Systems (NYSE: EPAM), symbol EPAM, provides outsourced software and technology, digital content consulting for technology companies, media companies, pharmaceutical companies, financial services, the whole gamut. Founded in 1993 by Arkadiy Dobkin, who is still CEO. It works with half of the top 10 banks, 80% of the largest pharmaceutical companies, has a really admirable track record of being, what I call a 20/20 company, Steve. Consistent, steady 20% growth in revenue and profits. Last quarter it actually fell below that level, so I'm looking to see when they report earnings next quarter, if they're getting back to that. It's an $18 billion company, the stock has done really well, up more than four times in five years. Reporting earnings next week, so a lot to watch and see what they are talking about regarding their market and are their clients willing to spend more with them.

Hill: Steve?

Broido: Will a continued pandemic help or hurt this company?

Cross: You know, I think it will continue to help because of the consulting, the digital market they play in, it's not a huge driver like it is for the likes of Pinterest or Shopify, but it does definitely help.

Hill: What do you want to add to your watchlist, Steve?

Broido: I'm going -- is it Inphi or IPHI?

Moser: Inphi.

Broido: Inphi. Count me in, I'm in Inphi.

Moser: Love it.

Hill: All right. Jason Moser, Ron Gross, Andy Cross. Thanks for being here, guys.

Cross: Thanks, guys.

Hill: That's going to do it for this week's Motley Fool Money, the show is mixed by Steve Broido, our Producer is Mac Greer. I'm Chris Hill, thanks for listening, we'll see you next week.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Chris Hill owns shares of Amazon, Starbucks, Under Armour (A Shares), and Under Armour (C Shares). The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, EPAM Systems, Etsy, Facebook, Microsoft, Pinterest, Shopify, Starbucks, Twitter, Under Armour (A Shares), Under Armour (C Shares), and Wix.com. The Motley Fool recommends Comcast and Inphi and recommends the following options: long January 2022 $1920 calls on Amazon, short January 2022 $1940 calls on Amazon, short January 2021 $115 calls on Microsoft, short November 2020 $85 calls on Starbucks, and long January 2021 $85 calls on Microsoft. The Motley Fool has a disclosure policy.


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