How We Invest in a Falling Market

In this episode of Motley Fool Money, Motley Fool contributors Travis Hoium, Andy Cross, and Lou Whiteman discuss:

• Nasdaq correction
• Energy’s shocking rise
• The AI trade
• How well do you know your market history
• Stocks on our radar

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A full transcript is below.

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This podcast was recorded on Mar 27, 2026.

Travis Hoium: Nasdaq is officially in correction territory. What are we doing now? Motley Fool Money starts now.

Welcome to Motley Fool Money. I’m Travis Hoium joined today by Lou Whiteman and Andy Cross. Guys, as of early Friday, Nasdaq is down 12% from its all-time high. That actually happened in October, but the drop over the past couple of weeks has been pretty notable. Now, that means we’re in correction territory, 20%, it would be a bear market, I believe, if I’m getting my definitions correct. This is partly about Iran and oil prices, but it’s also partly about questions about AI, lots of things going on. When you look at this market overall, what do you think the market is seeing to have these big negative days we’re down 1.2% early in trading on Friday. Yesterday was a big down day. We’re not getting earnings. What’s on the top of mind for investors?

Andy Cross: Well, Travis, I think the start of the year, there was a little bit more hey, how is the market shaping up with so much of the tech spending? There’s just trillions going into data centers, and that pivoted very quickly towards the Iran war, the activities going on in the Middle East, and the impact on not just oil prices, but now I think more and more, it’s what are the ripple effects to those increases? Oil prices are going to percolate. If they say elevated throughout the economy, how is that going to impact consumer spending? How is that going to impact investor appetite? I think the markets have started shifting as we’re thinking, gosh, where is the value going to be not just for individual investors, but also for institutional investors? Much of that capital now has started to flow a little bit more towards things like energy and materials in the marketplace, energy is up more than 30% so far this year. But the overall impact into the market, whether it’s a Nasdaq or just the S&P 500, for energy is relatively small. You haven’t really seen the impacts, and that’s been even though the investing appetite has shifted, you haven’t seen that show up in the general markets because energy is just a smaller part of the investment landscape and of the indices, and technology is so much of a big of that part of the market, and that money is starting to flow out of there as investors get a little bit worried about, gosh, how much of this AI spending in data centers is going to be recouped because of the value for those dollars looking down the road. Where is the investor return going to be? You’re starting to see this market shift, and that is showing up in the overall indices and just some nervousness with the investor appetite going into 2026, and the Iran war certainly not helping.

Travis Hoium: I want to put some numbers to that. The Nasdaq Composite, year to date is down 8.9% as we’re recording. The S&P 500 is down 6.1%. Is that part of that energy allocation that you’re talking about. The NASDAQ is not going to be allocated in energy. Whereas if you look at one of the things I like to look at recently is the heat map of the S&P 500. If you do a year to date heat map of the S&P 500, there are huge segments of the market. A lot of the most popular stocks that we talk about all the time are down really big. Then you got these small little boxes, like, utilities, like, oil producers, Exxon Mobil, that are up huge. Is that what you’re talking about is that just that allocation has not balanced out because of the weights of the index?

Andy Cross: Energy makes up 3-4% maybe of the index right around there, compared to, technology and financials. Financials also not having a good start to the year just because of the interest rate concerns. Yes, those parts of the market just aren’t represented in the index, so you’re starting to see those fall off. Of course, many fools out there, including myself, own a lot of technology stocks. As we see those technology stocks underperform or there’s the Mag Seven or other parts of the tech stack underperform, that also weighs on some of that confidence and just wondering, hey, where do I have to try to find some Alpha in this market? Looking out over the next couple of years, do I need to raise some cash? How do I start to position myself knowing that technology or thinking about technology is starting to shift a little bit and other parts of the market are looking a little bit more attractive, considering some of the macro factors that we’re seeing. Now, I mentioned financials, financials have not done well this year, mostly because the interest rate environment where we are expecting rate cuts throughout pretty much the year, if you look at a lot of the expectations, and now the expectations are the rate cuts are not going to come, if at all, they come later in the year.

Lou Whiteman: The six-month treasuries have been jumping, which, music to my ear, but not really we see with the markets. I think Andy did a great job, like, breaking down, the market dynamics and why maybe, if anything, I’m a little surprised the overall markets have held up as well as they have. You listen you read reports, you listen to podcasts as, energy experts talk about like, wow. We are experiencing things that in the models, we said, well, this is worst-case scenario and we will never know, and that’s our reality. I think part of this, too, is market psychology. I’m worried, guys, because I do think that the damage done will take time to heal. I think it’s a question of quarters or if not years, how long it takes to ripple through the economy. I think that as an investor, I might not change things on that because I’m trying to focus on the long term and I’m trying to be in companies that can get through down cycles. But it feels like this is the straw that might break the camel’s back and cause recession. On the other hand, what’s happened every time the stocks have gone down less since COVID, there has been a pop. I do think the markets are likely looking for a pop when we finally do have some resolution to what’s going on in the Middle East. I think that’s rational. Especially if I’m a professional money manager and I’m graded quarter to quarter, if I think a pop is coming, I’m not positioning for five years. I do think there’s these weird psychological dynamics that if anything, I think it’s good to maybe understand or have a feel for. But for what I’m trying to do, I’m also trying to ignore. I’m trying to maybe use it to explain what I’m seeing and why things are moving. But I personally don’t want to make decisions based on what could happen next week, but I do think the psychology of the market is that we do see whether it’s Fomo or, what’s going on is influencing what’s going on.

Andy Cross: Lou and Travis, it’s interesting. The individual investor Lou mentioned about, the buy the dip mentality. Individual investors now represent a good chunk of the investing activity. That’s a lot different than it was five years ago, and we’ve seen them be in a lot of ways, the buyer of last resort and institutional investors, a little bit more on the short term panic, hit the button, jump out of positions. Individual investor treat.

Travis Hoium: That has been a fascinating shift over the past 10 or 20 years.

Andy Cross: It’s really elevated since COVID. If you look at really since COVID, when so many institutions or so many individual investors, hey, credit us. Hey, win for the individual investor. That’s awesome. Those individual investors have really, in many ways, supported the market, especially on the margin side. I think you are starting to see, hey, it’s been a great performance the last three years, really since 2022, after that bear market, the markets have done so well, so many positions have done so well, led by technology. Now I think individual investors are saying, hey, made overweight in that area, and now I’m starting to pivot and look at other spots of the market. I think that shift is going on, and that’s not necessarily that doesn’t get reflected in the index. As we mentioned before, and that’s one reason why the index has underperformed this year.

Travis Hoium: One of the questions that I have about the market and the economy, one of the things you guys talked a lot about market dynamics. We have not talked a lot about the economy, and the reality is oil prices are soaring. That’s a huge expense for a lot of consumers. Year to date, rent crude is up 76%. WTI, West Texas Intermediate it’s up 70%. We’re at $93 per barrel. That is going to ultimately hit people’s pocketbooks. Lou, does that worry you that yes, I think Andy is totally right. The great thing that we’ve been trained as individual investors is to have a longer term view and to buy these dips but what’s different now is that in the last 17 years, we have not gone through a traditional recession where people are losing put COVID aside. There was a lot of weird things going on with COVID. But where those buyers of last resort, that Andy said, were, losing jobs, we’re pulling money out of the market, instead of putting money into the market, Are those two things energy prices going up and the risk of a recession, could that be bad news squared for the market overall because those buyers are going to start going elsewhere or just going to cash?

Lou Whiteman: I’m definitely worried. Look, we’ve talked about this a lot before. We like to talk about the consumers if it’s one person, but it really is just all of the households out there. On an individual level, do you feel confident enough to keep spending at your average pace. It’s always a mix between yes and no, If the nose hit a critical point, then that is when the consumer is having trouble. Oil is one thing, but just, the refined products, what we actually consume, hopefully not literally. But whether it’s gas, whether it’s jet fuel, whether it’s, what happens with plastics on all the chip making, the helium and some of the acids that we get out if everything is getting more expensive, does that shift the K-shaped economy just slightly till we end up in a downturn? It wouldn’t shock me. Travis, you’re right. We are now conditioned to buy the dip. It wasn’t too long ago that look after the dotcom boom, the Nasdaq took what a decade to recover. There was a whole, market mentality tied to that before. I’m guessing this time around won’t be either extreme. I don’t think knock on wood, it won’t take 10 years to bounce back, but I think we might end up with enough headwinds that we find this a lot easier to just bounce back and move on. I’m trying to think about that. I don’t know if I can change my portfolio with that, but mentally, I’m trying to prepare myself, so I don’t do anything panicked if and when that does happen.

Andy Cross: The one slight bright side is just the impact of increasing energy prices and oil prices, gasoline prices is much less now than it was, 30 or 40 years ago. That’s some good sign, but Lou is absolutely right. It’s just going to percolate through the economy. I think, again, investors are sensitive to this. Travis, you did, I think, bring up a great point when you just think about, there’s just this uncertainty around jobs, I think, now that we’re all feeling whether it’s AI or just macro conditions, and that might be a weighing impact on investor appetite to put more capital to work into stocks. Now, we might have some pretty big IPOs hitting the market this year, which would be very exciting. I think individual investors, especially would gravitate towards that. In the K shaped economy, the wealthy are as well off now as ever before. We have a little bit of that, but I do worry about the job impact having some negative consequences on the appetite for individual investors to be investing.

Travis Hoium: It does seem like there’s multiple pieces of the market, too. We talked about that a little bit. Like energy is doing very well. But if you just look at, certain segments, we went through this in 2022, as well. There were certain segments down 70, 80, 90%. Then you look at the market overall, and it was like, it was a down year, but it wasn’t the end of the world. We didn’t actually end up in a recession. The other thing that I wanted to note too is even going back to the Great Depression, these recessions, market corrections, any downturn you want to talk about, they seem to be shorter than every single time we go through them. The Great Depression was a decade, even dotcom was two years. COVID was like five minutes, so it may be the case again this time. When we come back, we’re going to get an update on the AI trade. You’re listening to Motley Fool Money.

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Travis Hoium: Welcome back to Motley Fool Money. The question I have this week is, has the AI trade lost its legs? Andy, we’ve got some big moves in some of the AI players over the past few years, and this is what’s really driven a lot of the market. Even GDP growth has been driven by AI investment, so Microsoft down 24% this year, Tesla down 70%, Nvidia is down 8%, Oracle down 27%. Some of these stocks are really taking it on the chin, despite some phenomenal numbers, so what is going on with this AI trade?

Andy Cross: For the most part, great on the earnings side, the revenue side, even making impacts on a lot of their AI benefits, but certainly, the market is just thinking about the return on all of these spending. It’s going to be trillion dollars close, give or take whatever year you’re talking about.

Travis Hoium: What’s a few hundred billion dollars between friends?

Andy Cross: Yes, and we had just re-recommended Amazon recently. We had this conversation among the team. Amazon is going to spend hundreds of billions of dollars on capex this year. What happens if they came out and said, hey, we’re not going to spend quite as much? How would the market react? Would they be positive because it’s going to benefit the free cash flow, or negative and say, gosh, they’re not spending enough to be competitive in the AI race against the likes of OpenAI and Google and Microsoft, and Meta, who are spending equally hundreds of billions total. There is this thinking at the market, and the market doesn’t quite know what to make of these numbers, Travis, and it gets to our earlier conversation. They’re saying, hey, great. Investors are, I think, thinking, hey, it was a great run, but now these dollars are getting so high. I made a lot of money in these stocks, and I want to pivot and look at other parts of the market.

Travis Hoium: What is your answer? Let’s say that Amazon this year or even next year says, hey, we are going to pull back. Do you think that boosts the stock?

Andy Cross: I think the market would react positively to that.

Travis Hoium: It has changed 180 in six months, it seems like.

Lou Whiteman: Honestly, I’m not sure. I just cut it to play devil’s advocate, but I think the market long term may like it, but I think in the short term, the first company that says we’re cutting back is risking that it’s going to be reads like ours isn’t as good or we have failed and everybody else is still going so that’s fascinating to me. Look, for long term, if that’s what they’re seeing, they need to pull the band aid, but I am not sure the market initially would cheer any one company alone, saying, I’m not so sure.

Travis Hoium: They need to have a joint press release. We’re all pulling [OVERLAPPING]

Lou Whiteman: Good luck with that. Part of this, too, I think, is just the sheer excitement, the euphoria always degrades over time. There’s so many of these stocks are still up so big over, say, five years. The fact that they’re down for a few months, maybe that is just us normalizing. But just look at OpenAI, the last month. They’ve introduced things, they’ve dropped things. I think that, as we are seeing, it’s good that these companies are trying to focus on where can we make money, especially the ones like OpenAI that are going from zero to try to do it, but I also think we are introduced into the conversation, the idea, will this make money, or how are you going to make money? Seeing things fail makes that a big red underline that it might not just work out. Maybe there is just a little more, like Andy said, show me, or maybe we’re just a little more grounded as we look at this instead of just anything and everything is good.

Travis Hoium: Well, and a lot of things are cycles, so if you think about something like the Gardner Hype cycle, where you have this hype cycle with artificial intelligence started at the ChatGPT moment in November of 2022. You eventually end up at a point where you get to a trough of disillusionment, where people go, man, this isn’t real, there is no payoff. Maybe the technology is real, but we went through this with the Internet, where are these companies going to actually be able to make money? That took years to get to that point. Is it possible, Andy, that we get to that point in the next year or two with AI? Actually, that’s when you want to start buying some of these companies because that’s when you’re going to be able to find the next Amazon, the next Google, and they’re going to already have won the market. I think looking back historically, that would have been the time to buy.

Andy Cross: I think that’s right, Travis. These are some of the greatest companies ever created in the world. I think the chances of them making and doing well with these investments is spot on. It’s just that right now, the market is just not rewarding that.

Lou Whiteman: Almost inevitably. I agree, it’s hard to imagine any of these is really the quote “losers.” I mean, they are so good, and some of these companies in so many places, I don’t think it’s an extra central threat, but if everybody’s a winner this time, it will be the first time. I do think that part of this is just trying to think in those terms. Again, I don’t think Microsoft is going to go to zero if they happen to be a loser, but there will be relative winners and losers here. I don’t think any of us know the answer to that, but I think maybe what we’re seeing is just that these discussions started to happen instead of, yes, just go.

Travis Hoium: When we come back, we’re going to see how well Lou and Andy remember their market history. You’re listening to Motley Fool Money. Welcome back to Motley Fool Money. In this segment, we like to have a little bit of fun, so I wanted to see how well Lou and Andy remember their market history. These are all tied to things that are going on in the market today. We may have our first trillionaire if Elon Musk is able to take SpaceX public in the next month or so. Since 1983, nine men have held the title of richest person in the world. Can you name all of them, or even, you know what, if you can even name seven of them, I’m going to be pretty impressed.

Lou Whiteman: We’re going to start with Elon, we got one.

Travis Hoium: Let’s start with Elon. There was somebody who held it for a number of years.

Andy Cross: Jeff Bezos.

Travis Hoium: Only a couple of years for Bezos. Surprising one there, only three years, 2018 to 2022.

Lou Whiteman: Bill Gates for a while.

Travis Hoium: Bill Gates held it for over a decade, I think.

Andy Cross: Buffett for a while.

Travis Hoium: Buffett for one year.

Lou Whiteman: Just one year.

Travis Hoium: What year would that be?

Andy Cross: Is it 2001?

Travis Hoium: 2008.

Andy Cross: 2008, fascinating.

Travis Hoium: The down year, the one company who was able to come to the rescue, Warren Buffett. Now you’re getting to the harder territory.

Lou Whiteman: There was Carlos Slim.

Travis Hoium: Carlos Slim.

Andy Cross: Good one.

Travis Hoium: I’m going to give you a hint. Early 1980s, who would have been the richest person in the world? Sam Walton.

Andy Cross: Sam Walton?

Travis Hoium: Then there’s three that you’re missing. One of them, this was just in the last four years, Bernard Arnault from LVMH, and then there is two people actually. I didn’t even remember this in the early 90s.

Lou Whiteman: Early 90s.

Travis Hoium: Two Japanese real estate investors. I’m not even going to try to put you in their names, but everything ended up going belly up. He was the richest person in the world in 1991, and then was no longer a billionaire a little over ten years later, so just crazy how fast things can go down.

Lou Whiteman: I mean, relatable, Andy?

Andy Cross: Well, it’s just like they’re thinking about those oil barns, just like the wildcatters that they live and breathe, and they go through these cycles. It’s just T. Boone Pickens, a fascinating chance to interview him and talk to him. Just even at the elevated age that he was when we spoke to him, he was just so sharp when it comes to energy and his fields. But I think he had gone bankrupt something like three times before and just made it all back.

Travis Hoium: That is one of the wild things, some of these people who are well-known investors, you look back on their history, and they have these periods of bust in them. Benjamin Graham, as well, I think, either went bankrupt or was effectively broke. We talked a little bit about oil earlier in the show. Do you guys remember what year US oil consumption peaked? I’ll give you a hint, it was not last year, but what year did oil consumption peak in the U.S.?

Andy Cross: I’m guessing 2007.

Lou Whiteman: That’s close. I was going to say sometime in that decade. I’ll go under, I’ll say 2004, just to be different. But I think Andy’s probably right.

Travis Hoium: The answer is 2005, I’ve got this [OVERLAPPING]

Andy Cross: Right in between.

Travis Hoium: I’ve got this EIA table that I go back to every once in a while, that has oil consumption. It’s just always fascinating to see because you think about the impacts. We’re not driving less, but vehicles are much more efficient, and there’s just a lot of efficiency that’s gone through the market overall. Electric vehicles is a small piece of it, but it’s not most of it when you look at oil.

Andy Cross: Also, just the impact of changing diesel engines, how does that all play into the refinery capacity and all that stuff, too?

Travis Hoium: Exactly. Speaking of refineries, what percentage of oil in 2005 did the US import on a net basis? The U.S. imports some oil, and then exports refined products or oil. But on a net basis, what percentage of oil did the US import in 2005 at that peak consumption?

Lou Whiteman: More than half.

Andy Cross: Fracking was just taking off. Fracking had just started taking off at that point.

Lou Whiteman: More than half, I don’t know. Pick a number, Andy.

Andy Cross: I’ll go a little bit higher, I’ll say 65%.

Travis Hoium: Sixty percent, wow, that is a good memory. What percentage of oil over the last I think, we’re on what the first four months of the year, the last eight months that they reported. What percentage of oil does the US import on a net basis today?

Lou Whiteman: Closer to 20 or so, maybe.

Andy Cross: I would say even lower.

Travis Hoium: Negative 10%, exporter of oil.

Lou Whiteman: I got you.

Travis Hoium: The fascinating thing there is we talked about oil prices and the rise in oil prices. In the US, that is not going to be just a complete sink of money, that’s just a lot of that oil came from the Persian Gulf in 2005. That will just recirculating through the US economy in one way, shape, or form. Maybe we have another boom in Texas and in North Dakota, again, if we get oil going to $150 a barrel.

Lou Whiteman: Just the other big thing, too, is where it’s coming from. I would bet that the vast majority of the imports it’s just we need the heavy crude from Canada. It’s a North American story. I think Fortress North America looks even more impressive. It’s still a global price, unfortunately, but the world has changed.

Andy Cross: Well, it’s interesting the pricing difference too, between WTI and Brent, the global price, especially traded over the physical asset. Traded overseas after the Iran conflict, and how that has really changed, and at least part of it is because of the fact that we are a net exporter of our own crude.

Travis Hoium: Let’s put some numbers to that we got this in front of me. As we’re recording WTI, West Texas Intermediate, which technically needs to be delivered in is it Cushing, Oklahoma, I believe, $97 per barrel. Brent crude, which is the more international crude price is almost $111 per barrel. That’s that differential. Usually, they’re pretty similar, but that’s that differential you’re talking about where the internal dynamics in the U.S., not quite as impacted as you see internationally. The next question, we’re going to potentially have the biggest IPO ever next month, maybe in the next couple of months. What is the biggest IPO so far? How much was raised and was the value of the company?

Lou Whiteman: It was Saudi Aramco.

Travis Hoium: Correct.

Lou Whiteman: How much they raised, I don’t know.

Andy Cross: I think they only issued, like four or 5% of the company or something like that.

Travis Hoium: Twenty billion? I don’t know. But ultimately, $29 billion. But that was a $1.7 trillion valuation at the time. These IPOs have gotten just bigger and bigger.

Andy Cross: If you back out that, if you go Saudi Aramco, which is own unique beast, I wonder what the next one would be like a 50 billion valuation, I think, right?

Lou Whiteman: Most of them are international. I don’t know what the list would be, but SoftBank, Alibaba, a lot of the biggest ones have been these massive headline-grabbing international companies. You have to be bigger arguably too if you’re an international company listing in the US. But I can’t think of what the biggest US IPO would have been.

Travis Hoium: Does Alibaba count? Alibaba raised $22 billion, had a valuation of approximately 230 billion at IPO. Does that count? Those structures, those companies is very strange.

Lou Whiteman: I don’t know if that counts or not.

Andy Cross: Will we get three big IPOs this year? There seems to be a little bit of a race to see who can come in. Sounds like SpaceX is the first one out of the gate, but OpenAI, Anthropic. Databricks has always been in there.

Travis Hoium: Well, what do you think? Of those four, Andy do you think we’re going to get two, three, four of those hitting the markets this year?

Andy Cross: If Anthropic goes or OpenAI goes, I think the other one has to go.

Travis Hoium: That’s like a warning sign. If Anthropic kill public, OpenAI can’t, then that’s real trouble.

Andy Cross: Well, OpenAI, I think, is going to be a little bit more difficult. They just need so much capital, more capital than Anthropic does right now. As we’ve seen over the past couple of weeks, they’re really trying to find what company they are going to be and where are they going to focus on and how do they drive their enterprise subscription, which a year or two years ago was all talk about OpenAI and Anthropic was this little interesting bubbling upstart that’s mixing things up. Now the narrative has completely changed, and the world has really started to focus much more on the enterprise licensing and business model of Anthropic and how OpenAI can compete with.

Travis Hoium: This is going to be fascinating. Obviously going to get a lot of attention no matter when they do go public. Let’s turn to some historical market numbers. The S&P 500 and Nasdaq. We talked a little bit about the history of recessions potential, oils impact. The last major recession before the financial crisis was the tech bubble, maybe some parallels to where we are today with AI. The market peaked in March of 2000, so both the S&P 500 and the Nasdaq. How long did it take for both of those to regain their all time highs?

Lou Whiteman: I mentioned this earlier. I think the Nasdaq was about a decade. The S&P was quicker, I don’t know. Ten years for the Nasdaq and 2.5 years for the S&P, I don’t know.

Andy Cross: I think the peak March 9, 2000, was the date, I just have that in my head, at least. That’s what I remember.

Travis Hoium: That was the bottom of the great recession, but the market actually peaked in, was it March 2008 was the peak?

Andy Cross: No, I’m saying March 9, I think it was March was it. You know what? Yes, maybe you’re right, yes. March 9, 2009 was the bottom of the great financial crisis. March 2000 also was the high of the Nasdaq peak?

Travis Hoium: Yes, March is a big.

Andy Cross: I’ll say seven years for the S&P, and I’ll say 12 years for the Nasdaq.

Travis Hoium: That’s probably better. Andy is good at this. Seven years is the correct answer for the S&P. Short lived, though it really took 13 years to get a sustainable gain over that 2000 high because then you had the great financial crisis [OVERLAPPING] 2007, 2008 and then 15 years for the Nasdaq to get back to the all-time high. One quick one to end us on. This gets to everything that we talk about with the Motley Fool being long-term investors, having that long-term mindset. Even if you bought at the peak in March of 2000, and you bought four stocks, Netflix, Amazon, Microsoft, and Apple. Those are the four I’m going to give you. If you put $10,000 in each of those stocks, how much would they have been worth? Let’s start with Microsoft. That’s the laggard of the four. But if you put $10,000 in Microsoft, how much would you have today?

Andy Cross: As a person who owned Microsoft through those dark days and then eventually sold it about a year before Satya Nadella took over, and then the stock took off. After I befriend I finally bought back into it a few years later. Gosh, $10,000 in Microsoft in 2000? Is he worth today?

Lou Whiteman: Man, I’m so bad at this.

Andy Cross: I think it took 14 years for Microsoft to recover is my guess.

Travis Hoium: It’s more than 10X since then. You’d have $130,000. Next up, Amazon. If you bought Amazon, basically at its peak. You had the worst market timing ever because I think it dropped 90% after this. If you put 10,000 in, how much would you have today?

Lou Whiteman: 500,000. I don’t know.

Andy Cross: It’s got to be a 50 bagger.

Travis Hoium: Pretty cool. More than a 60 bagger, 618,000. Apple is next up.

Lou Whiteman: All of that it’s probably flat over the last. Apple, Chase, 1.5. No, that’s too much. Definitely over 1 million, Andy. I don’t know. Maybe over 2 million.

Travis Hoium: Yeah, $2.6 million. Netflix. This is the fun one. If you had bought $10,000 worth of Netflix stock.

Andy Cross: It was a penny a share because I know in Stock Advisor, our cost basis is, David’s cost basis is like pennies.

Lou Whiteman: What was Apple, Travis, Apple?

Travis Hoium: Apple was 2.6 million. Netflix, you would have $7.85 million by just doing nothing, but holding Netflix stock.

Lou Whiteman: Wait, and the real lesson there, and I know it doesn’t work this way, but say you bought 10 companies, and nine of them went bust, and one of them was Netflix. It’s a weird game. Your batting out was just terrible, and you don’t care.

Travis Hoium: It’s these huge winners that really define your returns in the market.

Andy Cross: Long term, it’s a slugging percentage game, really, across diversified portfolio list, like those mega winners drive the bulk of the return. Studies show this time and time again, but most investors, I think, are trying to much more focus, at least in the short term, on batting average. They don’t want to lose money. They want singles and doubles.

Travis Hoium: I hadn’t even looked this up. Invidia, by the way, would be $14.2 million, so that’s even better. I wouldn’t have guessed that much, I’ll admit. When we come back, we are going to get to the Stock Center radar, you’re listening to Motley Fool Money [MUSIC] As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against so I’ll buy or sell stocks based solely on what you hear. All personal finance content follows the Motley Fools editorial standards, and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. We like to end the show with stocks on our radar. Andy, you are the newcomer this week. What’s on your radar?

Andy Cross: Well, team, let’s talk about a company that most people use and know if you wear a uniform at your place at work, and that is Cintas, symbol CTAS, company has been around for years and years and years. It was family-founded and a father-son run combination. The stock’s been absolutely outstanding. We put it into the Stock Advisor team Hidden Gems. Tom, put it on the Stock Advisor scorecard in 2008. It’s up almost 40 times in value, absolutely crushing the market. The last 10 years, last five years, and last three years, it has beaten the market, as well. They reported quarterly earnings. The numbers were continued to be impressive, revenue up 9%. But what’s really impressive is their margin profile. They’ve just done a fantastic job managing that distribution network for office services, uniform rentals, first aid kits, all those things that offices need.

Over the years, their growth rates have been somewhere in the high single digits on average over the last five years, but they’ve been able to continue to get margin improvement, so they’re margin profile grows faster. They pay a nice little dividend. They buy back some stock, they make smart acquisitions. The big news is they now are looking to acquire Unit First, which is another huge provider of uniform rentals. I’m watching how that acquisition all works through because it will add a lot of goodwill to the balance sheet. But hey, if a company can get the value out of those assets, it is Cintas because they’ve done it time and time again. CTAS is one I’m continuing to be impressed with and continue to watch, especially with the stock more than 20% off its all time highs.

Travis Hoium: I believe, I don’t know if it was Cintas, but back in my 3M days, I used to wear these lab smocks that were serviced by one of these companies. Andy, have you ever worn a Cintas uniform in any way, shape, or form?

Andy Cross: I never have. I’ve only worn a lab smock back in my high school days, and I don’t think it was a Cintas one.

Travis Hoium: Maybe we need to make you a user.

Andy Cross: Yes.

Lou Whiteman: You could have back at the spectrum, Andy. You could have gotten a job at the spectrum back in the day and done it this.

Travis Hoium: Lou, what are you looking at?

Lou Whiteman: I’m focused on airlines, and in particular, JetBlue, ticker JBLU. Guys, there’s a lot of drama in this sector right now. Sky high fuel prices, chaos at the airports. This week, just to add to the drama, JetBlue has come in and said, we are looking for an exit. They’ve reportedly hired bankers to explore a sale. On paper, a deal makes sense. JetBlue is getting squeezed by the industry’s big four. There’s no clear path for growth in part because they weren’t allowed to buy someone. All the rumored buyers, United, Southwest, and Alaska, they all have reasons where this would make sense, but also they all have their own internal drama or internal priorities, other than this to deal with. Airline mergers are historically really difficult to integrate. It all just makes for a big mess. For now, I’m mostly just making popcorn and watching because I think it’ll be fun to play out, but I will say the most interesting company out of all of this is one I haven’t mentioned, Delta Airlines, best mix of balance sheet and product. If one of their competitors decides to do this, it could really benefit them in terms of just grabbing assets at airports and also just letting the chaos play out. Real interesting sector to watch right now, but JetBlue with a little shout out the Delta. That’s what I’m watching.

Travis Hoium: Is this actually an investable space, or is this just popcorn, like you said?

Lou Whiteman: I think it’s more investable now than it used to be. The big four are a lot healthier, but it is still highly cyclical. Keep your seat belt fast and didn’t expect turbulence, all of those puns.

Travis Hoium: Well, I’m feeling a little bit sentimental, so I’m going to add Cintas to the watch list. Not a stock that I’ve looked at, but, man, you look at this stock chart. This is obviously a very impressive company. For Lou, Andy, and Bart behind the glass, I’m Travis Hoium. Thanks for listening to Motley Fool Money. We’ll see you here tomorrow.

JPMorgan Chase is an advertising partner of Motley Fool Money. Andy Cross has positions in Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia, and Tesla. Lou Whiteman has no position in any of the stocks mentioned. Travis Hoium has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, JPMorgan Chase, Meta Platforms, Microsoft, Netflix, Nvidia, Oracle, and Tesla and is short shares of Apple. The Motley Fool recommends Alaska Air Group, Alibaba Group, Cintas, Delta Air Lines, Lvmh Moët Hennessy – Louis Vuitton, Société Européenne, and Southwest Airlines. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.