5 Summer Vacation Stocks


It's Tuesday, June twenty fifth walk them to market foolery. I'm Chris hill. Joining me in studio back in the United States of America. It's Jason Moser looking, tanning and west it in ready feel like in my defense, I probably always looking tan to some level. Like I was adopted. So I don't know necessarily the bloodline there. But we've all determined that there must be some Mediterranean in me. But yet, maybe someone who sees you pretty much looking more. Maybe a little bit more. And there was a lot of sun there. Your little bit closer to the equator goes to Riga. Yeah, we'll get to that, and we'll get to some drama or maybe not drama between Warren Buffett and three g capital will unpack that as well once again, we're gonna start with a big deal this time in the healthcare space. And I'm saying healthcare, just the huge umbrella of healthcare abbvie buying. Allergen Allergan, the maker of boats. Socks. This is a sixty three billion dollar deal cash and stock Algan. If your shareholder while you're having a heck of a good day because the buyout price is forty five percent higher than yesterday's close. I am curious though the fact that Algan is now only trading up about twenty five twenty eight percent higher. We'll get to whether or not this deal goes through. But this is this is yet another big deal. Yeah. The I mean, whether it goes through is going to be interesting, just from the perspective that it wasn't all that long ago that there was an offer made believer allergen for for quite a bit more than today's offer. But then, also the recent calls have been for the company actually to split up and spin off some of its assets to realize more value that way. And then you find yourself where you are today as shareholder in the deal and is, is gonna be the best way to realize value for our shareholders. I don't know. Maybe I mean, I feel I it is a deal that brings together to companies that can likely do more together than separately. They're not a lot of overlap there. I look at this space, it kinda feels like that chip maker space in the sense that they're always stuck on this wheel of never ending innovation. You've always got to come up with something new the next big thing. And if you don't come up with the next big thing, I mean, the fall from grace can be pretty pretty severe. But I mean you know with our I mean, that's I think most people probably know it for talks and. I'm a little bit conflicted. They're just because botox I know there's some therapeutic implications there with migraines. It seems to be more something people associate with wrinkles, and like, cosmetic stuff. We gotta wonder how really necessary that is. I mean, other than just someone's vanity and I don't really have a lot of sympathy for that. But, you know, I mean it's a difficult one of work drugs face a lot of scrutiny in they're going to be plenty failures. It's questionable honestly today, whether you should be using some of them so interesting to see how this plays out. Well, and yesterday Dan climate, I talked about the merger in the casino industry with El Dorado and Caesar's. And that's one that, you know, at least to here damn clientele over the long term. That's you know, the he feels good about that deal, clearly, based on what's happening with shares of abbvie today. Looks like there, plenty of people who don't like this deal or. At least think that they are paying too much for elegant because shares abbvie are down about fifteen percent, and it's not like this stocks light in the world on fire the last eighteen months. Yeah. And I mean, you know, we talk about that a lot in that the acquirer usually feels a little bit of a pinch on the day of deal and the, the acquired feels a little bit of a bump does seem like these are heavier reactions than we might normally see. And I mean I do get that. Because when you look at our. In its overall business. I mean, you're talking sensually between botox cosmetics and therapeutics. That's more than two point five billion dollars of the company's overall sales, and that growth is clearly slowing down. I mean if you look at those numbers, but then when you look at the two companies combined. I mean, there are risks out there when it comes to generics. I mean, a lot of these drugs that they that they've been benefiting from for so long starting to come off Pat now generics threat. There was a there, a depression, drug, I think reasonably that our had trouble with in. I mean, again, I mean you go back to this idea that. I do think we are hitting a new generation new generational mentality that is going to question, whether we need a lot of a lot of these drugs. I mean, whether it's a depression, and they're serious, serious problems either. I mean, I'm not making light of, of something like depression. I mean, any any of these things require attention. But, but if you re any these commercials for these drugs, I mean it becomes now more. They read off it takes more time for them to read off the side effects and potential implications as opposed to the benefits of the drug. I mean you remember that Simpson's, I got to always go back to the Simpsons, right. Do you remember that Simpson's awhile back where? Homer was approached to be the spokesman for Viagra. Gain, do you remember that a lot? It gives you a lot of hair in what you need down there. Beth Ryan, and then but the possible side effects include loss. Oh, scalping Pena's. That's what was said next. And that's what these drugs always feel like you'd see this little benefit, and you're like, oh, well, that's nice. But then you hear about the side of why knee hell, what I take that thing it sounds like I may die. Maybe I'd just rather do it on my own terms. There is something I think they have to figure out there and I'm not sure so, so simple because because it does feel like the it feels like this base is only becoming more pointed in that direction, where you question the benefits versus the costs. And so the consolidation is not terribly surprising. But to companies was slowing growth doesn't necessarily make one company that can accelerate growth. Speaking of slowing growth, let's talk about craft Hines because shares are down about fifty percent or so this year. There have been reports of trouble between Berkshire Hathaway and three capital bears. Remembering that those two teamed up a few years back to buy Kraft Heinz and got a lot of headlines at the time, and rightly, so in part because Warren Buffett has or certainly had up to that point a track record of making acquisitions essentially on his own. And so, at the time it was like, oh, here's this new deal. Also buffet has been critical in the past of private equity. So it raised a couple of eyebrows berkshire-hathaway with team up with the private equity firm, even won the reputation of three g capital and then go out and buy craft Hines. Apparently these reports. You hear little rumblings here, and there, it never struck me as something that was front page news. You know, maybe I missed it, but I know that the Wall Street Journal had some splashy a headline on the front page about some big rift. But apparently, Warren Buffett felt the need to reach out to CNBC and come out and today and say that there's no tension between Berkshire Hathaway three J really downplay these reports. And I don't know. I, I don't know your reaction. But my reaction was well, first of all, given what's happened given the way craft Hines performed particularly over the last two years, the write downs that have happened for? Berkshire Hathaway the fact that buffet aside to come out and say, oh, yeah, we paid too much for this. I think any reasonable person would expect there to be some level of tension, seems like a little bit of, you know, he protests too much. You're slag messages, just it made me laugh on my way to work because he just like really shouldn't there be some tensions because. Yeah, you're right, there should be stock has gotten killed in for, for a lot of a lot of non necessarily easy to reasons. It seems like I mean. Misreporting notwithstanding. Right. Restatements notwithstanding this on its surface, this, thank you. Just add parenthetically. Yes, craft also some accounting problems. And it does mean that's not it's certainly we've seen other companies that have had that. And I mean it's you're talking about something that's very fixable in. You can recover from that. But I think the thing about this deal that always struck me it on the surface, it's right in his wheelhouse. Right. Is just consumer brands not tech related. It's food. It's something you associate with your arch all that really. I mean, a lot of these brands we you and I associate with our childhoods, and I think that's part of the problem really. I mean I know he said that the biggest problem facing crab Hines is that Hines overpaid one merging with craft in July. And then they made a mistake and overpaying for that investment. I think. It goes far deeper than that. I mean, I think that these are brands that are they're not resonating with, with younger generations of consumers today. And I don't think that necessarily changes so quickly, particularly when you see the attitudes towards what people are eating the brands are coming up from that in the nature of being able to get that get out there and brand Bill didn't exist when we were rowing up via social media and other other channels. I mean, I just it's not to say that this is some, you know, trip zero I don't think that's the case. There's value in Kraft and Heinz Philly cream cheese and whatnot. But I know I don't look at those as brands that are going to be leading the way going forward. And I think that. You know, for for them to think that overpaying was the problem. I think misses the point tireless. Well, and I'm not I'm not rooting against Berkshire Hathaway. I'm not rooting against Warren Buffett, I but part of me just to be completely honest. Part of me is heartened by the fact that. Yeah. Warren, Buffett's human. Sure, you know, and he would probably like a mulligan on this one and from time to time we talk about sunk costs and how that's hard to fight against as an investor turns out. It's hard for Warren Buffett to fight against because at the time of this deal in twenty thirteen one of the things buff, it said at the time was, oh, yeah. I've had my eye on hind going back to nineteen eighty so for more than thirty years. She had on some level, but look been looking at the Heinz business and saying, boy, I show would like to get some of that. And ironically, had he made that investment back, then I'm sure things will work that a lot better. I mean I think you you really hit. On something there that I would love to know like given a mulligan. And if you could have this deal for half of what you paid for it would would you do again. I would ask buffer that would you do it again, if you can have it for half because I mean, maybe he would maybe would I think the value investor in quite possibly, would, I would still question that, but yeah, I mean, again, it just goes back to sometimes things are cheap for reason. US news. And World Report has come out with their annual list of the best places to travel to Paris, coming in at number one, followed by New Zealand's South Island than Rome to Sheedy and London running out the top five number twenty nine on the list, Costa Rica. Now I did note. And I do wanna share, you know, not only what kind of time you had in Costa Rica with your family, but also to the extent that you had business takeaways. But I did note that in their right up US news and world port included this caveat when it comes to Costa Rica, and I'm quoting here, just make sure you plan a visit during the country's dry season between December and April. And I read that this morning. Check her first question. I'm pretty sure Jason's trip fell outside that win. It definitely did. And I mean first and foremost, I think my lovely wife for lobbing, this idea of. Many many once ago because once she said, Costa Rica, I thought, hey, I'm all in place. We'd never been loved to go visit, and so we planned it for awhile. Thankfully, for us, the weather worked out, really well, and we had a couple of days that were total rainouts in just very fortunate that on those days, we didn't have anything planned in the house that we rented was on top of a mountain on the Pacific Ocean side of the country. So, you know, we had a nice view and, and easy way to spend the day even even when the weather was bad. But I mean that's first time we've ever been I loved it. I mean, I feel like if you love nature and wildlife and animals, that's a place. You really need to go visit, I can't speak to the other side of the country. But I do know that on, I mean, from what I've understood the Pacific side is, is better from wildlife perspective in, in certainly, we got to see a lot of from a business point. I know from following you on Twitter. You're reading. John Carey's, book banned blood. Yeah. Yeah. That was just entertainment. I mean that, that was I had I had spoken with Greg, Greg gauges, a member of ours at, at full fest. And, and he just told me because I was waiting actually just watched the documentary on HBO. And he said dude, read the book, then watch the documentary or watch the documentary, then read the book, but either way do both in. And so I took him up on that in no regrets. It was a terrific book. But I mean when I when I yeah, I look at that trip. And I think men, there's so many things I did that. We did that touch my portfolio in one way or another. And I'm sure like the easy thing is to come back and talk about payments and travel. Right. So I'm not gonna talk about that because I think about that before traveling, but because of Costa Rica because of the nature of the wildlife side of it, like we went to an animal sanctuary one day where they're helping injured animals in the jungle recovers, they hopefully put him back out. We went horseback, riding one day through the jungle and on the beach was really cool. Saw. Just tons of wildlife. It was so cool. And it got me thinking that one of the company do I talk about IOT X laboratories a lot on the shows. But the other one that really doesn't get as much attention Izzo, Edis, ticker. There is E T S, but they're the business of animal health medicines and magazines. So whether it's companion animals, like dogs, cats horses or its livestock animals. Zo Edis is essentially the world's biggest company when it comes to the spun out of FIS or a while back. So a little bit of a bigger company, perhaps the growth, isn't quite like, you know, some type of rule breaker, but plays in a very, very large and growing market pays nice little dividend. Well led I own shares personally. So ETA struck me as one that just from the wildlife perspective. I'm certain that some of their stuff was being used down there. And then from an entertainment, perspective, beyond the book. I really do. Think Spotify is building a really strong entertainment platform beyond music. I think podcast I think it's going to become an entertainment. Platform that people use for so many different things. And they've got such a large user base. Now with a lot of a lot of data, they can pull from that. They're, they're building their own content Hamad think you're gonna be able to a lot of stuff with. And so, I think spot of has another one, the fats domino award that goes to Tripadvisor the L ain't that ashamed. It's such a helpful service in for whatever reason they just cannot Bill the compelling business from it. I mean, I again, I mean I said, from the Bahamas and Costa Rica was accepted. I just got so much help from Tripadvisor on the trip there for whatever reason they've not been able to build a really compelling business out of at least yet, maybe that'll change, and then the one to keep an eye on. I think even when you take a bake -ation in a word never seems to escape you, particularly if you love your work, like I do so with new air service, I was in touch with some people here, you know, back and forth. And slack was really, really helpful from that perspective. So that ticker is w. Oh, are K new listing obviously. But everything from work to got to go. Have dinner down there with Mario, gotta and his wife Sophia. Their fools have been to Austin event and the more recently fast. So we got to go see them in their home country and have really cool post a picture of that on slack, and people here at work loved it. So a lot of different things that platform, does I like the integrations with other companies we like out there that are doing stuff, helping workplaces communicate better. So that was that was, what was going through my mind when I wasn't completely unplugging. Nice cloudy unplug and made it back. Thanks man as always people on the program if interest in the stocks, they talk about in the motley fool may have formal recommendations for can't settle buy or sell stocks based. So what you hear that's going to do it for this edition of market for this shows mixed by Dan Boyd. I'm Chris hill. Thanks for listening. We'll see you tomorrow.

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