“The best Motley Fool investing idea since AOL and Amazon.com in the 1990s”

What are David Gardner's "Voice + Prediction + Gesture = $$$" Stocks?

By Travis Johnson, Stock Gumshoe, January 15, 2013

Irregulars Quick Take Paid members get a quick summary of the stocks teased and our thoughts here. Join as a Stock Gumshoe Irregular today (already a member? Log in)

That’s our pitch today — that the new “themed” technology investments being teased by the Motley Foolians are as good as David Gardner’s push for AOL and Amazon.com back in the days before the Motley Fool published their current Stock Advisor newsletter.

The ad letter actually comes in from a different Fool employee, Todd Etter, though it’s all about the ideas being pitched by the Gardner brothers in their flagship letter, and the stock ideas they’re holding above our heads (jump! Just a little higher! Only $49 now!) are all built around the basic idea that instead of people learning how to use confusing computers, the world is moving toward computers learning how to understand people.

Or, as David Gardner titles his “special report”: “Voice + Prediction + Gesture = $$$”

Incidentally, the Foolies have dramatically cut the price of Stock Advisor — at least in the email pitch I received, they’re down to $49 and the last pricing I had seen before that was, I think, $199 … I wonder whether they’re testing the strategy espoused by the Agoraplex newsletters and starting folks off with a low price to get them used to paying something, then pitch them on “upgrades” more aggressively to get them into the more expensive letters in the years to come. I guess we’ll start to find out as the next crops of teasers roll through. (The list price is still $199 on their website, FYI, so maybe they’re just testing out some sale prices.)

So what’s the big idea? Well, the title of the report pretty much says it all — the companies behind voice recognition, gesture recognition and big data (that’s what you use to predict behavior) are going to make us rich. Etter tells us that much of this advance came from video gams.

“… one thing I’ve learned from being a professional game maker and game player all these years is that a lot of real problems — in education, in medicine, and even in defense & security — were solved by innovations that first appeared in video games.

“Which is why, when I first heard about David’s newest investing idea, I knew right away that he was onto something big.

“Because I had already seen it in the video games my kids were playing.

“It just hadn’t dawned on me yet that it would be the perfect solution for so many of our daily aggravations. Or that it would be so easy to use, and work as well as it does….

“I also didn’t realize that scientists at M.I.T. were calling it ‘the most important new technology since the smart phone.’

“That major corporations like McDonald’s, Toyota, Microsoft, Intel, Samsung, GM, Sony, and Bloomingdale’s were scrambling to implement it.

“Or that major hospitals like Miami Children’s Hospital and the National Naval Medical Center were already relying on it to treat their patients.

“And I certainly didn’t know the 3 companies that David had selected for his newest investing strategy, or why his research made him so confident about them.”

So that’s the basic spiel … what, then, are our three companies? He teases them one at a time — the first one is the voice recognition pick:

“It all starts with the power of your voice….

“… if you’re like my wife and me, the solution you’ve already fallen in love with is “Siri”…

“That’s the name of the voice recognition program on Apple’s new iPhones. (You’ve probably seen Samuel Jackson and Martin Scorsese using it on TV.) …

“But here’s the really interesting thing… Someone else gets a fat cut of the profit from every single one of those iPhones! And it’s a company very few investors have ever heard of…

“See, the Siri voice recognition program wasn’t invented by Steve Jobs. Or by anyone else at Apple.

“And even though Google and Microsoft are using the same program in 540 million other devices, neither of them invented it either….

“… the little company that does control the key patents for what scientists like Steve Rizzo at the University of Southern California are calling ‘the holy grail to technology’… can sell it to whomever they please….

“…stocks like this one, which benefit from the success of Apple and the other technology giants — but require a bit more savvy to discover — make such good investments.”

Now, tying your stock idea to Apple (AAPL) has been less of a successful pitch in recent weeks … but we’ll let that pass (and I’m still a holder of Apple stock and think it has gotten ridiculously cheap, if you’re wondering which side of that fence I stand on).

More clues about this first pick? But of course …

“According to Andrew Rosenberg, a computer science professor at Queens College in New York, the company that controls this voice recognition technology is ‘the equivalent of Microsoft, Google, or Amazon in a very niche technological space.’

“And with 43 different strategic acquisitions over the past six years, and a war chest of 2,016 patents, it’s easy to see why he’s comfortable making such a provocative comparison…

Bloomberg BusinessWeek took things even further. Calling this CEO ‘every bit as powerful as Steve Jobs.'”

OK, so those are accurage quotes and that’s real information, albeit not a full picture, but it ignores my favorite quote from that same Bloomberg Businessweek article: Dave Grannan, CEO of Vlingo, was quoted as saying that “Competing with Nuance is like having a venereal disease that’s in remission.”

And yes, this first teased pick is the dominant voice recognition technology company, Nuance Communications (NUAN). Which, perhaps not surprisingly, bought Vlingo about six months after that quote.

Nuance does own the technology that helps to power Siri, we’re told (I don’t think Apple has officially confirmed that still, but it’s widely believed that Nuance is involved — and it’s hard to imagine that they wouldn’t be), and they have indeed been extremely acquisitive over the years in adding new technologies and patent portfolios to their quiver … and they are not, frankly, all that expensive if the analysts are estimating well. The company has finally started to generate some real revenue and profit growth over the past year, growth that analysts believe is sustainable, and while it’s probably wise to be a bit skeptical of a company that has been so acquisitive and such a “next year” story for several years now, there is a growing trend toward voice recognition from more and more of your gadgets, from your TV remote to your car.

Of course, Nuance, despite being quite aggressive in the courts, does not own the whole idea of interfacing with machines via voice — and there are projects at most of the big software and mobile companies to develop better voice controls, too, including from Microsoft and Google. So we can’t necessarily draw our straight line on the graph and say that Nuance is going to own the “Siri” of the future … but you can definitely argue that if anyone’s going to win that race, Nuance has the pole position.

They’ve gotten consistently better at turning sales into free cash flow in recent years, and in generating more cash flow than earnings, so that’s a good indication that the business is “real” and has some staying power — though they also turn a lot of that cash into investments in acquiring little bolt-on companies, and they’re pretty free with the stock grants to management. There is good insider ownership, and a couple of large institutional shareholders, but there has not been any insider buying in the recent past. Right now they’re trading for 12X the expected earnings for this coming year (their fiscal year ends in September, but we haven’t seen December quarter numbers for NUAN yet so that’s really just the forward estimated PE). That’s coupled with earnings growth that is expected to be about 10% in 2013, and projections that they can grow earnings by better than 15% a year going out into the future … so if those numbers work out as the analysts expect NUAN is certainly worth buying here — that’s a low PEG ratio and a stock with a good “theme” story behind it, and they have done a little bit better than analyst estimates over the past three quarters.

Of course, that depends on NUAN continuing to lead this technology and getting more clients and more installations, leading to more revenue — much of their revenue in the past has come from older technologies and businesses, particularly stuff like medical dictation, so there’s plenty of risk that as voice integration becomes mainstream it might take away some of the barriers to entry for other companies. Nuance did recently win Hyundai’s business in developing a new voice system for their next generation of vehicles, and they’ve had similar systems in other cars for a while, but we don’t really know how much revenue that turns into in the future. They also own the only real brand in the voice recognition space, Dragon, but I don’t know whether that brand really means anything just yet.

So … mercurial CEO that people love to hate, lots of patent lawsuits, rumors of an attempted takeover by Apple about a year and a half ago, and lots of dreams about the future of talking to your TV or your car in plain language, and you can see why Nuance gets a lot of press. Beneath that chatter, however, is a company that has managed to scare off or acquire most of its small rivals, and that has pretty quietly become reasonably priced … the growth for this current year isn’t dramatic, but at a PE of 11 or 12 you don’t necessarily need dramatic growth. The shares have come down a bit this year and there isn’t any particular momentum to either the earnings growth or the stock price, but it is in a potentially growing industry and it’s not expensive. I don’t own the shares and never have, but as it dips down here I’m starting to think that maybe it’s worth taking a deeper look.

How about the second idea pitched by the Fool?

“… it’s time to meet our second hidden Silicon Valley power player.

“And find out how Apple got a leg up on Microsoft when Steve Jobs went to seek out this visionary CEO’s advice about prediction software.

“We’ll also discover why Jobs trusted this man as a mentor… literally driving to his house at one point to sit on the floor at his feet.

“And finally, we’ll see why 134 of the world’s 200 biggest corporations have trusted their future to this tiny company’s one-of-a-kind technology solution.

“Remember, the key is prediction. Computers can’t really think like we do, but with this cutting edge software, they can learn….

“… when Wal-Mart came looking for an ‘impossible’ 60% bump to its sky-high profit margins, this company used its prediction software to show them a new way to sell popular items like Strawberry Pop-Tarts… seven times faster!”

Seriously? Wal-Mart’s profit margins are only sky high if you compare them to Amazon’s. I can’t think of many large companies that have smaller profit margins, WMT’s overall margin is right around 3.5% and not high even when compared with peers like Target (4.2%).

OK, they’re high compared to grocery stores, which often have profit margins below 1%, so we’ll accept the pop tart reference … but grudgingly.

“[David Gardner] went on to say that it’s widely known among technology insiders that this company simply makes this software better than anyone else does.

“(Even the mainstream media is starting to catch on… For example, CNBC’s Jim Cramer says this ‘scrappy company’ has ‘a major edge on the competition,’ and admits that the way it’s been overlooked by Wall Street insiders is ‘kind of ridiculous.’)”

So … hoodat? Well, the two possibilities are both stocks that have been recommended by the Motley Fool, Tibco Software and Teradata … and both have been mentioned positively by Jim Cramer over the past year as well, but the fact that we’re talking primarily about software to understand this predictive data (rather than systems to store and organize it — Teradata is a data warehouser, Tibco a software company) leans toward Tibco, as do the specific quotes about being “scrappy” from Cramer. So I’m pretty sure they’re teasing Tibco Software here, symbol TIBX (though Teradata was specifically involved with those Wal-Mart pop tart epiphanies, back when it was a division of NCR … the story was that Wal-Mart used data mining to discover that people stock up on pop-tarts after a hurricane and therefore increased pop tart sales dramatically by stocking heavily into predicted hurricane areas. I don’t know if Tibco was working with Walmart at the time or not.)

And yes, that story about Steve Jobs sitting on the floor in front of the CEO is true, that was way back when Jobs had been fired from Apple and was starting fresh and wanted some guidance from Vivek Ranadive, who hadn’t yet started Tibco but was well respected for building and selling technology.

Tibco is a company I’ve been intending to take more of a look at as they’ve seen their share price drop — Ranadive is somewhat of a “big data” evangelist and he has built a business data integration company that is platform agnostic, with an incredible capacity to process and interpret reams of data. That may be important because many of the competitors work primarily or only with their own data systems, whether that’s Oracle or Salesforce.com or IBM. They have thousands of customers and have had a steadily growing business and slowly improving margins for several years now, but over the last year or so they’ve also seen earnings growth decelerate and, in the last quarter, a bad miss that brought the shares down sharply.

I don’t know whether or not TIBX will do better than expected over the next couple quarters, but their reduced guidance and disappointing numbers last time around still clearly have investors a bit nervous — analyst estimates have come down over the last couple months for both the current year and for next year, so we’re dealing with a very profitable company in what should be a growing business, but one that’s either facing increased competition or simply having internal trouble in managing their sales (they say it’s the latter).

I’m intrigued by this one, I’ll have to dig deeper and see if I can get comfortable with the reduced expectations — Tibco is not particularly cheap, they have big competitors and they’ve grown to a substantial size (about $4 billion market cap) now, and investors are wary … but they do have a good, high margin business and a recurring customer base, a strong toehold in the “big data” trend, and a strong leader, so the story is nice and solid … it’s just a question of whether we can be confident about the size of future revenues.

One more?

“The last piece of the puzzle is now ‘at hand.’ Silicon Valley types call it gesture control.

“And like I said before, if you have kids, you might have seen crude versions of this device before… in their video games.

“I doubt I need to explain to you why it’s a necessary complement to voice control — maybe even an improvement on it. And why it blows all of the old “user interface technologies” out of the water.

“Of course, there are bound to be skeptics. Remember the people who said they’d never use a computer mouse?

“But gesture control is just the next logical step after the mouse and the touch screen. As Dr. Mark Bolas at the University of Southern California points out, ‘when using a computer today, we think of our bodies as a fingertip or at most two fingertips. But humans evolved to communicate with their whole bodies.’…

“David’s investing strategy for this third and last part of his technology “triple play” didn’t lead him to a small, start-up type company.

“Instead, it led him to one of the most powerful corporations in the world.

“See, he believes they’re the only company with the R&D capabilities to refine this technology further — they’ve already developed a next-generation gesture control program that allows you not only to wave, swipe, and pinch your commands for a built-in camera, but also to use any surface in your house, including your couch cushion, your coffee table, and even the water in your drinking glass as a virtual touch screen.”

OK, so this one’s nice and easy, as several folks have noted — that’s Disney (DIS), which was similarly touted by the Fool in their “Television 2.0: The War for Your Living Room” teaser pitch a few months ago. The cool new remote control and technology stuff is part of their Disney Research arm, including several different touch- and gesture-oriented research projects … and maybe some of them will eventually migrate into your TV. But don’t worry, for now the cost of goods on the buffet table of the Disney Wonder cruise ship is going to be more meaningful for the bottom line than are these various R&D projects.

Disney is a technology company to some degree, of course, but their core skills are storytelling and merchandizing … and they do it better than anyone else. This is a stock that I’ve often intended to nibble at, but my timing has been bad and I’ve never actually followed through and bought shares — I think they’re in a tremendous position competitively with their Pixar, Lucas Films, Marvel and other creative franchises, and as importantly with their ownership of ESPN and it’s massive leverage over live sports coverage, but every time I sniff around the shares I walk away thinking, “eh, maybe I can get it just a little bit cheaper”. Last time was a couple months ago when they made the deal to buy the Star Wars franchise and bring out the next Star Wars film, the stock dropped a couple dollars, I and I thought to myself, “just a bit more and then I’ll buy.” But no dice, the stock bounced right back up.

Disney is not a particularly expensive stock, but it is a mega cap company with a market capitalization around $90 billion so you have to temper your growth expectations. If they can continue putting up growth numbers in excess of 10% a year, this is going to be a great investment even if you buy it here near the 52-week highs … but the skinflint in me, for some reason, keeps hoping that the flu epidemic will cut the gate proceeds at Disney World, or they release another awful and expensive film like John Carter, and then I’ll be able to jump on a slightly better price. I should probably just buy five shares a week and forget trying to pick a bargain, but where’s the fun in that?

So those are the three picks from Dave Gardner for this new revolution — I think it’s probably a stretch to buy Disney based on haptics and gestures, and there are plenty of other plays in data integration and “big data” to go along with Tibco, but they’re all reasonably priced firms with real profits and at least some potential to grow into new businesses as human-computer interaction continues to evolve. Got a favorite from this bunch or elsewhere in the field? Let us know with a comment below.

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Share Your Thoughts

ShowHide Comments (46)
    1. voiper
      Jan 15 2013, 05:54:30 pm

      I only skimmed this.. but I’m not so bullish on Nuance.
      Mostly: Google, and others, are working on voice recognition and google at least has the ability to fight back in case of law suit.
      Plus, google can actually give the tech away for free because they make money on the search, etc.

      And if you take law suits out of it, it seems many start ups are able to create their own voice recognition in a pretty short time frame.
      That’s the same reason I’m overall not so bullish on 3D printing systems — when people can start a kickstarter and get nearly $3million, and other projects get in the 6 digits – it makes me think the barrier to entry isn’t that high…

      • Deborah G Flynn
        Jul 4 2013, 10:24:10 am

        I have never been a fan of Motley fool. The profits are slim the growth slow and they pick things that are ok by a conservative standard but you never get anywhere. They make huge claims on their gians but I followed them for several years and while I didn’t lose money overall it was pretty flat overall. I’ll stick to my picks I do better

    2. chuck
      Jan 15 2013, 07:19:48 pm

      Have owned DIS since late 2008 when I bought my modest 100 shares at approximately 21 per. But probably being an even bigger skinflint/cheap skate than you –Travis; would not be adding additional shares over and above my dividend re-investment, even on dips, at a P/E of 16.5 and a yearly paid 1.5% dividend.

    3. john K
      Jan 15 2013, 07:44:11 pm

      Travis, I also think Appple is moving into best buy territory. If it drops below $480, I might even purchase a 500 June call. What do you think?

      • 3984 |
        Travis Johnson, Stock Gumshoe
        Jan 15 2013, 07:57:16 pm

        I thought it was a compelling buy at $520, so my thoughts might not be particularly useful on that point 🙂

    4. Dick
      Jan 15 2013, 08:33:49 pm

      About AAPL, the trend is down. Don’t buy now. I don’t know why but that’s a fact and for the moment it’s catching a falling knife.

    5. jax
      Jan 15 2013, 09:33:33 pm

      Travis, Your right about why they have lowered the price to the stock advisor. They havecome out with the “supernova newsletter group” for a mere $1,200 per year.

      • Deborah G Flynn
        Jul 4 2013, 10:25:57 am

        we DON”T NEED to pay those prices for newsletter we have our fearless leader. If you are NOt a paid subsciber get out of the skinflint mode and pay this guy! Travis is the best out there for fiunding out the teases we can take it from there. best money I ever spent

    6. 168 |
      Jan 15 2013, 09:34:33 pm

      That gesture technology certainly is interesting. In the Todd Etter Motley Fool note, he mentions ‘MIT scientists calling it the most important new technology since the smart phone’ . I did a search on this and found the company, Leap Motion. Unfortunately this company is not public. Here is the demo and more interesting, is the comments that follow.
      In the same Todd Etter note is a reference to Forbes magazine calling it ‘the most significant game changer in retail this decade’. Forbes likes Microsoft Kinect.

      • jdoggle
        Jan 22 2013, 11:45:06 am

        I did the same research when I originally received the Fool emails. I found Leap Motion and was excited to learn more about. I would definitely invest in them if I could. There was also another privately held company that was mentioned in their newsletter, can’t think of it right now though.

        I ended up buying SPLK.

    7. 996 |
      Hi Pockets
      Jan 16 2013, 02:55:12 am

      I joined the Fools about 3 months ago because of a teaser about 3D, paying $199 for a two year subscription. My big problem is that the stocks they recommend are usually over $50.00, which is too much for me If I want to be diversified. Also, the research available through ScotTrade usually does not rate the stocks as good buys for one reason or another (at that point in time).

      Of course, the Fool thesis is to buy stocks that have great upside potential over the long haul. At my age I have to be interested in mid-term potential — maybe one to two years.

      A smaller problem is that I’m spammed to death. I even get teasers from the Fool group in the U.K.

      I’m still working on exploring their website. Their graphing capabilities leave a LOT to be desired.

      All in all, I’m relatively happy with their service. Their commentary pages (“What Members are Saying About . . . . “) often points out things that I would not have thought about. And, best of all, joining them led me to joining Stock Gumshoe. So it wasn’t a bad investment! :>)

      • Ira Cotton
        Jan 16 2013, 01:16:24 pm

        What difference does the stock price make in a diversification plan? You don’t have to buy stock in 100 lot increments. Buy just 5 or 10 shares if that’s all you can afford.

        • 15
          Wayne Hatcher
          Feb 28 2013, 06:20:43 pm

          I agree. It doesn’t matter whether you have 40 shares at $50 or 100 shares at $20, 10% return on either is $200.

            • 15
              Wayne Hatcher
              Mar 22 2013, 02:38:34 pm

              No, sorry Mike. I spent 33 years in the Brewing industry involved in everything from production to safety/security. Before that I worked in mechanical construction during the 70s. That was another time when the economy tanked into recession due to high inflation causing massive layoffs in my field. I am just glad that hard times don’t stop beer drinkers because there have been several since. Funny how this stuff runs in cycles depending on political and socioeconomic policies. But sure as the sun comes up it’s gonna happen sooner or later. Retired now and just watching the world go ape AGAIN.

        • Alan Harris
          Apr 16 2013, 12:36:39 pm

          Hi Pockets
          Sure 100 @ 20 is the same $2k as a 1000 @ $2. But the replies your getting are not completely answering what I think youre saying….. and being skint, Im sympathetic. The smaller the amount you invest magnifies the trading costs (inc your Fool subscription) ratio of your return on capital employed. We spoke before on a different thread. If you can only invest a small (ish) amount, to begin with its better to spread that around just 5 stocks that you can get to know intimately. That way you wont need Fool to tempt you every 10mins nor pay multiple subscriptions. You can trade those few stocks’ movements 50 times a day if you like, rather than trying to keep up with the movements of 50 different stocks. And by buying bigger chunks, your returns ratio will be less depleated by trading/education costs.

          • Terrence Powell
            May 4 2013, 05:16:38 am

            @ Alan Harris,
            Could you give an example of how you would execute what you said about “trading movements… times a day”? For the most part I think I’ve got it, but I would benefit greatly from a solid example laid out.

            • Alan Harris
              Jul 4 2013, 08:14:05 pm

              Sorry Ive only just seen this. What I meant was, If you like the buzz of trading rather than buy and sit on it for months, you can short term/day trade trade any stock 5 times a day if you like. The problem (apart fom early heart problems) is that your gains are usually tiny, so you need to buy big so that small gains cover trading costs. If you are going to short term trade, you really need to know the company inside out or you are just gambling. Another reason to keep it down to 5 stocks is, if youre betting $2-3k+ lots x 5 that 15k in play. Happy for you if got more than that much as risk capital you can ‘afford’ to lose.

      • Rhinodaddy
        Feb 3 2013, 12:19:52 pm

        @David – Huge mistake if I understand what you are saying correctly. If you can only afford to invest a fixed amount per month join one of the online firms that let you buy incremental shares (like sharebuilder.com). The only reason the share of a stock price should matter is because of the price you are paying relative to fundamentals like P/E, NEVER because I can afford two of this stock at $50, but only one share of another at $100.

        Once I started building up my account, I made it a rule to never buy less than $2000 worth of any company that held my interest. Based on $10 transaction fees, that puts the ‘friction’ of losses at 0.5%. OK?

        • June Dwyer
          Apr 16 2013, 10:58:58 am

          What you said had a point – about never buying less than $2000 for a 9.95 fee for example
          on sharebuilder. Not everyone has $2000 to throw in at one time, though. I had my purchase
          on auto for a while on sharebuilder but even then it was $4.00 a transaction (waaaay too much), so now I stick to transfer agents like computershare and shareowneronline now. Fees depend on the company you are buying. For example, BKE charges more than $1 per transaction and CTL charges nothing. Unless of course the company is not serviced by one of
          these transfer agents – then go to etrade and spend that $10.

    8. fnoobler
      Jan 16 2013, 05:35:53 am

      I’m long Nuance Communications. There’s a transcript on Seeking Alpha where Nuance explain their technology:


      In that transcript the Chairman and Chief Executive Officer (not ideal re governance IMO) says:

      “we believe that our technology increasingly provides a source of differentiation for us”

      If you can figure out how, please post.

      Anyway I think they’d say they’ve moved on from voice recognition to natural language understanding (NLU). The way they develop NLU is to take an area like medical (I think, or maybe smaller like oncology), get experts to cook up some rules, then apply learning algorithms to a large data set.

      Some guesses:

      The data sets are some mixture of text and voice.
      Once a company has the general know-how, the size and quality of the data set determines how good the NLU gets.
      If it was easy to do, Apple would have done their own (although there’s more to a software personal assistant than just NLU).

      Also they have a joint research program with IBM, and Nuance’s latest acquisition does software personal assistants.

    9. Robert Hard
      Jan 16 2013, 10:41:34 am

      Regarding Apple, I agree that it’s an excellent company with great products selling at a very low PE for a company with reasonable growth prospects. (I say “reasonable” rather than “fanatastic” because their sales are already so huge). Does that make them a good investment? Not necessarily. I’m thinking of IBM in the 1970s. It was near the top of all companies in terms of market cap, it dominated its industry, it had a huge cash hoard (a giant stock portfolio they had accumulated with cash they didn’t know what else to do with) –and a stock price that languished for years despite strong earnings. The problem was not the company. It was the investment community. Everyone and his brother already owned it–so where was the new money (and really big money) going to come from to propel this mega-cap higher? Like any other product on the market, when everyone has bought it, there is no place for price to go but down. Apple was the single biggest holding for any number of hedge funds in 2011, and its fall was the single biggest reason that the index crushed the hedgies in 2012. Maybe with that selling (I haven’t actually tottted up the volume figures, which could be revealing) there is again room in poprtfolios for additonal Apple purchases. But that, i believe, is the problem you’re dealing with: Excessively broad holding, and nothing whatever to do with the Iphone 5 or any other product.
      And one more thing: i can’t think of an example of tech company that oonce had a high PE, but then lost it, and then got it back. Once that PE falls to the ground (i.e. 8 to 12), it tends to stay there for decades. If anyone knows some counter-examples, please post.

    10. John Kreamer
      Jan 16 2013, 11:52:24 am

      Apple has an advantage in its apps/iTunes store over android devices and that’s about it. Samsung Galaxy products are a year ahead of the iPhone. You hardly hear about Apple’s computers anymore. The iPad is also one of their leading products but the competitive advantage is not what it used to be. Slowly people are moving towards other smart phone manufacturers as their phones have more customer oriented features when compared to Apple’s. Apple refuses, to date, to make discounted iPhones and subsequently is losing out to the developing country markets. Their CEO had to travel to China in effort to get China Mobile to sell their phones which speaks volumes as in the past people were begging to sell Apple products. I don’t see why people think Apple will rebound. To me the writing is on the wall that they will go the way of Microsoft as a company with a lot of cash but flat stock prices. I live in Asia where I used to see everybody with an iPhone, now I see an ever increasing number of Apple’s competitors phones being used. RIM may also take away market share with its new phone and os.

      • ABirks
        Jan 22 2013, 09:34:47 pm

        China Mobile are unofficially selling iPhones, including 5, they are available in all China Mobile shops, not sure where they are sourcing the phones but despite CM not having 4g or even 3g thats iPhone compatible (iPhone only connect to CM with Edge) most users in China still prefer to use an iPhone with CM than with Unicom due to better national coverage and international roaming benefits.
        Whilst Apple could increase sales with CM with an official tie up, the increase would not be as great as people outside China believe since a good level of sales already exists.

    11. JulieMarisa
      Jan 17 2013, 11:40:41 am

      Today, the Fools are teasing with the dominant data storage players? I think that they’ve done this before with the whole secret “Columbia River” buildings which of course are located in Quincy, WA.

      I joined the Fools way back in the beginning and then left after a couple of years. Later joined for a year and then kicked myself for doing it. The Fools started by behaving like Gumshoe, then they became what they preached against. I get tired of the sales pitches.

    12. maleman
      Jan 22 2013, 09:55:05 pm

      I live in Asia and I too see the decline in iPhone users while travelliing on the buses and subway. My friend’s daughter even said nobody wants an iPhone cos it’s not cool anymore and it’s only used by the older folks. Without Steve Jobs around, Apple has begun to lose its cool factor. Nobody will make you wanna buy a product like Steve does. He’s a natural. Every other CEO just tries to hard. Anyway when Apple loses their cool factor and doesn’t keep up with their competitors new features {when they should be ahead) I don’t see how they’ll return to what they were before.

    13. maurice carter
      Feb 7 2013, 07:18:34 pm

      My friend is a Fool subscriber and is amazed at Fools reco Net Flex…. and it’s run ….from 0 to 200, down to 50 and back to 185….they really hold on and there picks have been very profitable. I’m pleased you covered Fool’s teaser…I’ve been looking and now I know. Thanks so much for your good work.

      Care to comment on the new (3 year) craze on BINARY OPTION TRADING!

    14. 528 |
      Franklin White
      Mar 22 2013, 02:20:00 pm

      TIBX pulled a stinker of an earnings report and projected lower earnings for next quarter.
      The stock was down about 16% earlier today and is currently down 12.7%. It will be
      interesting to see if they can bottom around the $20 level.

    15. Dan
      Mar 22 2013, 03:35:16 pm

      My platform shows NUAN with a 36.1 PE ratio, not 12 as stated. Which is correct? I see it gapped down from 24 to 20 on bad earnings Feb 7. Thank you Travis for a great service!

    16. george
      Mar 22 2013, 11:52:27 pm

      “OK, they’re high compared to grocery stores, which often have profit margins below 1%, so
      we’ll accept the pop tart reference … but grudgingly.”

      Grocery stores have a 1% margin on inventory; however, they turn their inventory over once a month. Thus, they have a 12% annual profit margin. If Wal Mart’s 3.5% margin is on inventory, the question then becomes, how many times per year does Wal-Mart turn over its inventory. You would need to know that before judging its profit margin.

    17. Lisa
      Mar 24 2013, 01:13:32 am

      I highly recommend UNXL (Uniboss touch screen) and PAMT (parmetric sound technology). Both have very low float and no debt. Even at these prices, they still have more rooms for upside. UNXL will be announcing their ecosystem and joint venture partners very, very soon and they’ll also announce first shipment of products in April.
      Do your DD and buy the dips.

    18. Richard Hewitt
      Apr 16 2013, 03:15:47 pm

      The best example of a tech company going from high PE to low and back to high would probably be Apple. They were in penny stock range after their original glory days and before their recent success.

    19. john
      Apr 16 2013, 04:58:41 pm

      I agree with Hi Pockets. The Fool has stocks that are to high to buy into unless you have a lot of money.. I need stocks from 5 -$20.

        • SCOTT MURRAY
          Sep 12 2013, 05:22:06 am

          True. If you think stocks are expensive based on the price of a share alone, without reference to other factors (such as earnings), you simply don’t know enough to invest in stocks. You are the kind of investor who makes stock-trading profitable for everyone else, because they take your money. If you could not afford one share of GOOG when it was selling for $200, save your hard-earned cash for hard times… don’t risk it on the market.

    20. Joe Gilson
      Aug 3 2013, 03:53:10 pm

      Blah blah blah Fool!! Buy Disney? It’s ONLY one of the greatest money generating businesses on the PLANET! Who doesn’t love Disney? Who doesn’t love ESPN? Who does not in some way, shape or form, spend money toward the Disney Co.? They make money even when they LOSE on stupid movies like The Lone Ranger!! Even if somebody died on one of their park rides, stock may tumble a bit…BUT when investors forget, like a day or two later, it will go back up. This is the best you got, Motley Fool? Come on!! Everybody wants to own shares of Disney!! Tell me something WE don’t know.

    21. J Franzo
      Nov 2 2013, 09:48:21 am

      Re: Nuance (NUAN), A month ago Carl Icahn’s son and a partner both joined Nuance board of directors, and ever since the stock is in a steep nose dive. Any thoughts why?

      • 18 |
        Dec 20 2013, 09:13:03 am

        One theory that I’ve read is that retail investors were hoping that after Icahn became involved, he would engineer a sale, possibly to Apple. When he shot that down and indicated that he was in Nuance for the long run, the price dropped.

        There has also been some notice recently of the ridiculous compensation paid to upper management, which has eaten up a large chuck of the firm’s profitability (there were a couple of articles on seekingalpha). Some people speculate that next year, when Icahn is no longer limited to 20% of the outstanding shares due to an agreement he made with management, he will increase his holdings and either change the compensation scheme or oust upper management entirely. We’ll see.

        I’ve been following Nuance since this article came out and finally bought some, first when the price dipped to around $15.75 and then added more in the low $13s.

    22. 18 |
      Dec 20 2013, 09:14:26 am

      Did anyone here buy TIBX based on this tout? It’s down over 10% in the pre-market today, and I’m wondering if anyone has any opinions as to whether it is still worth a buy, and, if so, at what price… Any thoughts?

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