Tesla’s Robotaxi Non-Event & GPT-6 Is Here!

(upbeat music) - Tesla had an event last night and we were not invited. Miley Fool, Jim's investing starts now. (upbeat music) Welcome to Miley Fool, Jim's investing. I'm Travis William, joined today by Lou Whiteman and John Quast. And guys, we previewed on the Wednesday show, Tesla's event that they had last night about the row of taxis. There's a lot of hype around this. Lou, not only were we not invited, I don't think anybody was invited. No live stream, no nothing. Yeah, I'm confused here, okay? 'Cause I get, I don't want to slam a company for doing a publicity event. Publicity events are very, very important. But if you wanna do a publicity event, you should try to get publicity. You should do a live stream. You should just like, they hyped this for weeks. There was contests of like, if you take a ride in Austin, you can get to go. And then night of the event Elon Musk didn't even show up. Not only didn't he show up, he barely had the energy to live tweeted. He did like one retweet or so. I, why bother? I just, I don't understand. They basically announced that we are actually doing what we announced last year, and it'll start rolling up. I, you know, the whole, this could have been an email thing. This could have been a press release, guys. John, is there a more bullish way to look at this? Well, I think that we're talking out of both sides of our mouth here saying there was hype for weeks, and then yet it wasn't hyped on the time of the event. I mean, I think that they were playing this the way that they wanted to play it. This, is it even fair to call it a launch? It really isn't. It's a slow rollout is what it is. And so I actually think it makes more sense to not overly hype this because we are not going out across the country in all cities with a fleet of hundreds of vehicles. If you do hype it too much, then you set the expectations too high, and then there's disappointment. Isn't that what Elon's been doing for a decade or more though? I mean, I mean, this is the wide deal of robot taxi. Yeah, the original robot taxi event was in 2024. Those two years ago, they started talking about the robot taxi. I believe in 2018 or 2019. Now, I mean, it's current form, but the idea of the robot taxi and having this fleet, we're almost a decade after that. And other companies have much, much bigger fleets. It's just we are at this point. And the reason that I wanted to bring this up on the show is we are at the point where autonomous vehicles are real. And Tesla was supposed to be have this huge first mover advantage. They were supposed to have a huge cost advantage. And once you have both of those things and you have this network effect, now no one can catch up. And it seems like they've kind of fumbled that. So John, are we at the point where they really got to put up or, you know, Waymo is out there scaling their vehicles and they're cutting their costs dramatically. I think the hardware, the rumors were the hardware costs for autonomous vehicles. So basically on top of the vehicle itself, went from about $150,000 down to about $20,000. This is the way hardware works. It gets less expensive over time. So yes, they have more sensors. But if the cost differential is very small and coming down, it seems like that advantage the Tesla should have is sort of evaporating in front of our eyes. Yeah, I mean, this is why we all drive Nissan Leafs right now, right? I mean, because Tesla fumbled its first mover advantage, right? I mean, Nissan Leaf came out before Model S. And you could say that it had the first mover advantage. But Tesla is the one that won out in the end. Listen, call it what you will, but Tesla understands one thing very well. It understands the psychology of the consumer, not necessarily that the best product wins or the first product wins. The most anticipated, the one with the best vibe is the one that wins a lot of times. It reminds me a little bit of the old, I'm a Mac, I'm a PC commercials, right? What was that actually telling us about the specifications of an Apple MacBook or a Microsoft PC? Really nothing, but one was perceived as a little bit cooler. And I do think that there are people who, when the CyberCab is available a lot more, I think there's going to be a lot of people lining up for CyberCab because that is the one that they want to ride in over a Waymo. It's why my nine-year-old counts cyber trucks on the road, but I've never told them anything about CyberTruck. We still haven't really explained what the purpose was last night though. I mean, look, we knew all this before. And yeah, congratulations. You didn't even get your CEO to show up. This would be like Apple announcing a new phone and then saying, the phone's going to be launched in three days, the phone's going to launch in two days, phone's going to launch in one day. We're going to do a big, big event for the phone launch and then just not talking about it right there. You're right, so there was the Apple versus PC commercial. Apple took the time to spend money to actually get that commercial out in front of people. My just kind of confusion here is that they had this event but then they kind of hid it, which is an investor. I don't know if I should read anything into that or not. They, it's funny, the biggest Tesla advocates coming out of this for like, I don't know why they did this last night. We didn't learn anything. Stock is down 6% on it. It's just very, I don't know, it could turn out being a great product if they get there and Travis to your point. I think the bigger fear is is that and maybe this is what they're acknowledging. I don't think events work anymore. Events were really cool when nobody had cars on the road and they were just giving you CAD CAM images of how cool this was going to be. Right now I can go out my door and see this in practice. And so for someone to do a PowerPoint presentation about how cool their service is going to be, that might work for kids, but that's not going to work for investors. You actually have to get, when you have what was way to have 4,000 something, I was just out. I passed three or four of them on the road. I think what's going to impress investors now is, John's right, when that day comes, if they're out there in force with fleets in the thousands all over the US, they might have the better cooler product and might win. But until then, I don't think that these events serve a purpose. I think they're just reminding us of the fact that they are behind. Well, John, let's go to the business model too because Tesla is still a $1.2 trillion company. It's part of the Meg 7. There's a reason that we're talking about this company specifically. And if you look at what the story was for Tesla five years ago, I mean, I remember listening to those conference calls and Elon Musk and team, that entire team where it's basically laughing at the entire industry going, you guys are all going to be licensing FSD in the future. You just don't realize it yet. And here we are in 2026. Not only is no one licensing FSD, doesn't seem like anyone is interested in licensing FSD. And everyone else is launching vehicles that are at the very least level two autonomy, you know, where you have this driver assist system a little bit like FSD is today, or going all the way to level four, which is in even level three, which is what companies like Mercedes have, you know, I think BMW is launching some of those features. These features are really starting to roll out in consumer vehicles on top of the zoosis of the world, the waymos of the world, main mobility is another one that's around. So it just seems like the thesis of five years ago is just not playing out the way that you would think. It is still a cool vehicle. My kids also count cyber trucks, but that doesn't mean that they've sold a lot of them. I think that mind share is important when it comes to long-term market share. But to your point, Travis, I heard someone say recently for every mile of road, there's two mile of ditch. And so I do want to stay out of the ditch on both sides. The ditch on one side is to say that Tesla is the clear market winner, and there's nothing you can do about it. And to your point, that's kind of how the executives were talking about it five years ago. The other side of the ditch that I want to stay out of here is that Tesla is irrelevant because waymo is ahead. I think it's incredibly relevant. Maybe it doesn't license its full self-driving software to the other car companies. Maybe they do build out there, and in fact, I think that's even more likely that each of these companies is going to have its own driver data that it can build its own models off of. I think that that's perfectly reasonable. But there will come a time when things are solved on the regulatory front, and we can actually sell to everyone everywhere. And that is really the big difference when you talk about an iPhone event, right? What were the restrictions on selling an iPhone? None, you could sell to anybody anywhere. Right now you can't sell a self-driving taxi to anybody anywhere. There are rules when those regulatory hurdles are cleared. That is when I think that this becomes a lot more meaningful who is taking share. - Maybe that would be a good time for an event. There you go. (laughs) Well, I'll ask a talk a little bit Tesla, but I think this is one of the more exciting spaces because we are seeing more of these autonomous vehicles all over the place. And it is going to be a huge market. It's just a question of how are investors going to be able to make money on it? When we come back, we're going to talk about the launch of GTA 6. Sorry, it's GPT 6. GTA, still not. - Yeah, not GTA. (laughs) - More on that in a moment, you're listening to Motley Fool Hidden Gems Investing. Support for the show comes from Fundrise. For the past 70 years, there's been a room in finance most people couldn't enter. A room where you could have invested in some of the biggest names in tech, couple of years. like Airbnb and Uber before their multi-billion dollar IPOs. I'm talking about venture capital, but unless you had millions of dollars and the right connections, the door to the venture capital room was closed. You were stuck waiting in line with everyone else. But recently, Fundrise took a sledgehammer to that door when they launched their venture capital product and made it available to anyone with a minimum investment of just $10. Fundrise says their mission is to give everyone the chance to invest in the best tech and AI companies before they go public. Visit Fundrise.com/fool to check out Fundrise's venture portfolio and start investing in minutes. All investments involve risk, including the potential loss of principle. Pass performance is not indicative of future results. This is a paid advertisement. Welcome back to Motley Fool in Jim's investing. John, we did get, we're not getting GTA 6 quite yet. I am excited to talk about that in a couple of months. But GPT 6, or at least the first version of that, is now starting to roll out at least to some enterprise customers that was announced yesterday from OpenAI. Interesting from the release. And here's the quote that I took from it. It can take away, take care of tedious tasks like filling out online forms, updating customer records in a CRM and organizing your calendar end quote. John, we were promised AGI and we get a bot that can fill out forms for us. It's definitely going to be more powerful than that. But is there really a there there for investors? Well, I think it's hilarious. The whole artificial general intelligence conversation, the AGI. This is of course different from just regular AI. AGI is basically AI smarter than humans in all domains and can connect domains together, really kind of think like people, but better. OpenAI president Greg Brockman is saying, welcome to the AGI era and saying, this could be AGI. And Sam Altman saying, maybe someday, we're going to look back at this and realize this was the moment. Listen, I'm sorry, if it's AGI, we're going to know it when we see it. And to me, that's a tell that the saying it. To me, it's a tell they still want to do an IPO, but maybe I'm too cynical there. That's probably true. This does seem like one of the it does seem to do to be back and forth between all these different companies. And we can bring Google and Gemini into this as well. They keep pushing forward with their their flash models. That's what I use a lot because it's just very, very quick and you know, it doesn't cost me anything. It's included in whatever, whatever Google things I'm paying for. But it seems like the push for all of these companies, and even with this one is on that enterprise side. And that seems to be really telling that that's where the money is for these companies. And also, I have to wonder as all of these companies try to IPO, how much money is there for them to grab if they're all going after that same enterprise customer, the same coding applications. It just seems like there's a bunch of money chasing one pot at the end of the rainbow. That's exactly interesting that you say that Travis, because actually this GPT-6 isn't great at coding compared to other AI models that are out there. In fact, if I recall, it's barely better than GPT-5. So it's not really excelling in the coding aspect. It's excelling in some other areas. But to your point, if you're going after enterprise, that that seems like something that maybe maybe you wanted a step improvement in. We're we're an investing show. I'm not going to pretend to understand and you don't want me judging which of these models is best and which one is bleeding edge and which one can be your imaginary friend. But Travis, to your point, we do need to see revenue here. And I don't I'm kind of numb from every six months. Another one of these companies saying, hours is the best thing in the world. And nobody can stop it. And we're visionaries and gurus or whatever. What I know is that increasingly the enterprises are finding ways to not use the frontier models. These bleeding edge models to generate the productivity they want. Travis, just like what you're saying, the flash models work good enough. I am going to go on a limb and say that for all of the attention that these new model releases get, they for the businesses don't really matter. I think that as these things get better, as they get maybe closer to imaginary friend status, there's going to be even less need to pay up for the most amazing thing. Because all of those trailing models are going to continue to get better as well. I think that both things could be true. GPT-6 could be the most amazing thing out there. But yet not a reason for an enterprise to that is already set up and clawed to shift. Lessor model at cheaper prices, kind of the meta model, feels like a better model right now than bleeding edge as a premium in terms of generating revenue. And that could be a real problem for some of these companies that are kind of focused on the bleeding edge. A couple of data points on that. Duolingo, at least for a while a year or two ago, was the biggest user of tokens from OpenAI. They talked on the most recent call about how, you know what, we are now using high-end models for certain things. But most of our work is being done with much less expensive models, open source or open weight models. We're really optimizing that cost. So that's not going to those frontier models. The other one is Uber. Uber is one of the companies to say, hey, we blew through our budget early in the year. But now they've said, hey, we're actually doing more with AI, but we're spending the same amount. So I think this is going to be something we're going to have to really keep an eye on as second half of the year into 2027. How does the spend for those enterprises go? Because it seems like it went astronomically higher in early part of 2026. May not be on the same trend over the next 18 months. All right. Luke, I quickly want to touch on the change with at Adobe. This is something that we've been looking for over the past couple of months. But Adobe is one of those stocks that's been beaten up. I think it kind of falls into that value territory for a lot of investors. So really intriguing. But they did announce a new CEO state in-house. What do we need to know? So the market doesn't like this. Apparently, down 7% today after the news, but also software stocks are down today. So I don't know how much to read into that. Yeah, the stocks been on a slide. It is up 35% since July 1st, but it's been cut in half over the last five years. So kind of pick your timestamp. This, to me, okay, full disclosure, I bought into this at the near its lows on the kind of, I thought the AI is going to eat its lunch was overstated. So I am all for it going up from here and not down. The CEO transition looks routine. And I think it's good that there is like just the question has been answered. Someone who has been on the job 20 years decided to retire. I think that's fine. Timing isn't great, but I don't think there's controversy here. CEO looks kind of new person. Kind of looks like a caretaker, but I think the business works. For me, I'm looking at business trading at 11 times expected earnings before the fall today and asking is AI going to eat its lunch? Maybe over time, but I don't think people like Dan Boyd behind the glass and all the people who use Adobe products professionally are in any hurry to say, oh, let's just code something up and do it again. So I think there's more stickiness here than we think. It's not a while higher. I'm glad it's now in the rearview mirror. And I am hopeful that just quarter to quarter we can see the sky isn't falling. And if so, did I mention 11 times expected earnings? Yeah. John, I do think that valuation story is really important, but also the question for Adobe is more about what is their business model look like in the future. And if you go back 15 years, that was really what the innovation of the outgoing CEO was, hey, we got to go from selling a box in Best Buy to this subscription as a service model that really turned around the company is a caretaker CEO, the right choice in that environment where disruption could be on the horizon. We'll see when Adobe reports earnings next week, but I would I'm suspicious that it's the wrong move. The guy that they passed over is David Wadwani. He is the guy who is in charge of Photoshop, Premiere, Acrobat, Firefly, basically the things that generate most of Adobe's revenue. And I think what the market is reacting to today is he's actually unexpectedly leaving the company saying that this is a time for a fresh start, new opportunity. And he said, this is a rare moment when technology changes, not just what we build, but how companies are built. To me, it sounds like there is somebody running out to vibe code up a competitive product. And I do have suspicions that Wadwani is headed for an AI company to better compete with Adobe after being passed over. Definitely one of the most fascinating companies to watch because when these AI products came out, it was those images that were really captivating that caught a lot of people's attention. But like Lou said, a lot of the people that use Adobe's products are not going anywhere. So interesting place for Adobe to be in. And when we come back, we're going to look in our 10-year crystal ball. You're listening to Motley Cool Hidden Gems Invest. Trading Eshwab is now powered by Ameritrade bringing you an expanding library of education with even more ways to sharpen your trading skills. Access new online courses, insightful webcasts, articles, engaging videos and more all curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. No sifting to find exactly what you need so you can spend your time learning to trade brilliantly. Learn more at Schwab.com/trade Welcome back to Motley Full of Hidden Gems investing in the segment we like to have a little bit of fun and I wanted to look in our crystal ball. We've talked about a couple of big things that are happening in artificial intelligence in autonomous vehicles. So I want some 10-year predictions from Lou and John and we can kind of go through how we're thinking about these things when we're looking for investment opportunities because this is the kind of time horizon that we like to look at as foolish investors. So Lou, which company is going to have the most autonomous drive miles driven per year, 10 years from now, 2036, Tesla, Waymo, or you can take the field, but you have to pick someone else if you're going to take the field. All right. So I'm going to push back on something John said earlier, where he was saying that he thinks that it's going like individual automakers are all going to have their own technology. I think that the long history, whether it's technology or parts in the automotive industry is that just normalize, commoditize, and move on. So that would be like the modular business model. For example, the level one solutions today, most of those come from mobile. Something like that. Yeah, I mean, look, and I know this isn't the same as white per blades, but I think there's just a long history of commoditization, innovation turning into commoditization in this business, and I am not going to assume otherwise. I didn't know I had to pick someone in the field. I saw I was going to say the field for that way, but I don't think it's going to be Tesla. I think I would take Waymo over Tesla here. I think I'll take the field if you make me say GM, I'll cringe, but just because they're bigger and I think they'll stay bigger. But yeah, something like whether it's mobile eye or Nvidia or someone, I think that this is going to just be like, right now everybody buys their turbochargers from the same place, basically, one company. I think that 10 years from now, we're going to have a similar situation with the technology inside the cart. So the idea here is that instead of each individual automaker developing autonomous driving technology, you have one company, develop it, and then sell it to everyone else. That's the modular business model. A couple of names there would be AV Ride. We ride one of those is owned by Nebius and one of them is publicly traded. I always get them mixed up, but there's like pony AI. There's a dozen or more companies that kind of fall in that category. John, what do you think is going to be happening without autonomous vehicles 10 years from now? Assuming no regulatory burdens or barriers, I would say Tesla. And I think that everyone listening is going to be like, this guy just loves Tesla. Okay, I don't own Tesla stock. I don't plan to buy any right now, but I do see the case here that they're going to have the most autonomous miles because they're the ones that can scale manufacturing to the cyber cab faster than competitors, in my view. So I would say that 10 years hence, if there is regulatory green light, then they're the ones that are able to get it out there. Plus, they have the resources to potentially subsidize those vehicles, whereas maybe competitors don't. We see that right now with AI companies, right? You're not paying the token costs, the true token costs. AI companies are subsidizing those to a degree to get you to adopt. I can see the same thing happening with Tesla. And I would see the incentive to do so. Can I break in and just another, I'm honestly curious what you guys think, like a related question. Those miles, do we think that the cyber cabs or the, you know, the autonomous vehicles are going to drive the most miles? Or do we think it's going to be individually on vehicles in 10 years? So just to that point, they basically had an inquiry yesterday. I think a form that you could fill out saying, Hey, I would like to be a fleet owner of cyber or something like that. I just say, in 10 years, do you think most people don't have a car in the garage? I'll take, I'll say no one that in 10 years. That's why I'm curious. Yeah, I mean, I don't want to give up my manual transmission. So I'm definitely going to keep the car in the garage. But it's a great question, Lou. It's a great framing. I don't know what the majority of people are going to feel about that. Yeah, I don't either. I mean, eventually, but 10 years seems really, really short for me to like think of the world changing that dramatically. We'll see. Here would be my prediction is, I think, so we have, you know, me, my wife and three kids and a dog. There's probably, it's probably unlikely that we give up all vehicles. But I would love to live in a world where we have one large vehicle, a large SUV or a van, whatever it is for driving the family around. And then that's it. And if I need to get somewhere or if my kids need to get somewhere, there's an autonomous vehicle that can just pick us up, you know, within a minute or two, that might mean that people still have vehicles in their garages, but there's fewer of them. So we'll see. We'll see. It'll be interesting to see how this plays out. And there's, there's a lot of bets to be made, whether you're looking at Tesla or a lot of other opportunities in the industry. Okay. Who is going to be building the best AI model? And I'm talking about the frontier side of things. Is that going to be Google and theropic open AI meta or the field? Again, I'd like you to take somebody, but I don't know necessarily know who would be that player in video, maybe something, something like that in the field. But the idea here would be not everyone is going to be on that pleading edge 10 years from now. Companies are going to eventually capitulate and kind of tap out, Lou, who do you have winning this race? I have no clue, but I'm going to take you through my logic here and explain why I come to where I do. I don't think most of the revenue is coming from the pleading edge, as I said before. So that makes me think that the best AI model, I don't know who's going to be around to fund it. If that's what you're focused on, I think the AI model providers in the future are going to be the Googles and the metas and the ones that have other businesses to support it. I don't think both anthropic and open AI are around as independent companies in 10 years, maybe one of them. And it's hard to say. I think they go public in the next year or so, and then they eventually get bought out either under distress or for some of other reasons. Or strategically. Yeah, I just don't think that there is going to be enough revenue for the pleading edge models for this to work as a standalone business. So I'm guessing the dominant AI vendors are going to be, if not the established companies we know now, but other companies is part of a more diversified business model instead of just a standalone science lab. Travis, I'm going to answer this. It's going to sound like a cop out. It is not intended to be, but who's building the best AI model 10 years from now irrelevant? Because honestly, I mean, as soon as you build the best AI model, someone's coming along beside you with something just as good for these companies that are focused on this, really, you're lead. Well, that's where we are today. But you've got to think that in the future, like, none of these companies are making a profit on building that leading edge model. So eventually, some of them are going to tap out, but who's going to, who's going to be left like trying to push that leading edge? Sure. I mean, yeah, I would say that, you know, alphabet is definitely still in the mix. I would be not surprised if meta was still in the mix, right? But which one of those two, if it's a two horse race, I mean, how much of a lead is either of them going to have, not for very long, I would say. Now, that said, I do want to circle back to something that I didn't mention here with the update of open AI's GPT 6. There is something interesting about this new model. So you've heard about deepseek and how it was able to basically make allegedly, right, reportedly, like this incredible model on only a fraction of the compute power. What it allegedly did was distill from the frontier models to create what it had. And basically, it's not training. It's just looking at the reasoning that the AI is going through and then taking that and putting it into its own models. Apparently with GPT 6, what I'm seeing is that the chain of thought is not as easy to follow. So it may not be easy to distill that for these cheap models that are coming in and trying to take the share. So that is something interesting to watch. It'll probably be somebody building the best AI model, who also is investing in the best compute. That would be a logic for some of these current leaders to widen that lead by making it more difficult to distill things like that. Okay. How are we shopping in the future? And the reason that I wanted to bring this up is I spent a lot of time thinking about where is Shopify going from here? Where's Walmart going and Amazon open AI's building these products? Some of the things that came out yesterday with the GPT 6 launch was just talking to the AI and going make a reservation for me by this product for me. I'm not ready to do that yet. But John, when you look out 10 years, how are we shopping in the future? Is it similar to today? So we have Walmart, Target, those companies still doing fine. Is it an incremental change from today? So Amazon is going to fight or is it we are using AI, maybe open AI as a winner or Shopify, I think would be a winner in that world. How do you think about the future of shopping? You know, that example from the launch video for open AI just shows me like how different those people live compared to most people, right? I mean, to need a reservation for dinner. I mean, it's just not something that hardly ever comes up in my life. But you know, agentic commerce definitely is the future. I think that if you look at these Walmart's, these Amazon's Shopify even, you know, kind of like the the website is not anything of a competitive distinctive anymore. or all retail companies need a website. I think that all retail companies are going to integrate with a agentic commerce systems. So then it becomes the other side of that. Your payment, your financial technology companies, the ones who are sending the agents to your platform. I think those are the ones to watch. Honestly, I would say that Coinbase is a dark horse here, the way that it is investing in agentic commerce. That's a really interesting one to watch. It's just funny, and again, not the sidetrack, but the whole make a reservation for you. The computer will do that. I just looked it up. Apple has been promising that since June of 2012 was the first time they did a demo on that, which again, yeah. So great, wow, innovation. That's great. We're a decade into this innovation. How shopping at a work? I am going, so I will say, and maybe I'm just being an old and maybe I'll change a bit of time. But the idea of a bot helping me with search is very, very intriguing. The idea of a bot making the purchase and things just showing up and I get to find out what it got is dystopian to me. And that is the difference. So my guess is that all of these demos, just like the Apple demo back in 2012, spoiler alert guys, the demos always overstate it. It's going to be some, 10 years from now is going to be some version of today with different tech tools to guide us versus, I mean, look, the idea of you would have told me 20 years ago that I could get on a computer and seamlessly search through thousands of products instead of having to just go see what they have at the local target. That would sound like innovation to me, but it's still all the same players plus a few more. I'm guessing it's going to look the same thing. I think Shopify will have a huge part. I think Walmart will. I think Amazon will. Open AI, if the ones you said, I mean, maybe, but it's just a different version of the same. It's not going to be as dramatically different as the futurists and the demos might say. I think what you're hearing here from a theme from a lot of these things with artificial intelligence is it's looking a lot more like a sustaining innovation than a disruptive innovation, which tells you that a lot of the existing players are going to be the winners in the future. So I do think it's just kind of as a clothing point. I think as investors, this can be useful to go back and see what, I mean, I don't mean to dunk on Apple here. Apple has done amazing things, but to go back a decade, look at what was promised and look at how it turned out in reality and then try to use that filter on what's being promised today. And so you don't get kind of too ahead of yourself as an investor. I think that there's logic. When we come back, we're going to get to the Stock Center radar. You're listening to Motley Foolhead Jim's Investor. Right now, when you buy more carpet at the Home Depot, you save more. During our Buy More, Save More event going on now, upgrade your carpeting with the top brands and save up to 15% off installed carpet projects. Installation starting at just 49 cents per square foot. Select from a wide assortment of carpet to fit your room, lifestyle, and budget during the Buy More Save More event at the Home Depot. Offer valid August 27th through September 13th, 2026. Base price for standard installations only excludes traffic master and stock carpet for licenses, see Home Depot.com/license numbers. Propel Fitness Water. With Gatorade Electrolites, Zero Sugar, and Vitamins, propel hydrates better than water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolites. As always, people on the program may have interest in the stocks they talk about in the Motley Fool. They may have formal recommendations for or against, so don't buy yourself stock space solely on what you hear. All personal finance content follows the Motley Fool's editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only to see our full advertisement disclosure. Please check out our show notes. Before we get to stock center radar, I did want to touch on some of the retail news that came out, John Lululemon reported earnings yesterday, not good, sales were down, same store sales were down 5%. The stock is down almost 20% in trading today. What did you see there? And is there a theme that we can see across retail and sporting goods right now? Well, Lululemon has a Lululemon problem, plain and simple. And the numbers back that up. So according to the Census Bureau, clothing sales in 2026 are up nearly 6% compared to 2025. That's actually a pretty big number. Now you look at Dick's sporting goods. It has a foot locker problem, not anything else. And again, the data backs us up. Sporting goods sales in the US up 10% so far this year compared to last year. The consumer is spending. And this isn't a case of consumers trading down from brand names to off brands necessarily. You look at American Eagle starting the year off with 10% growth, Abercrombies riding a 15 consecutive quarter streak of growth. You look at something like Yeti. And I know this is way out of this range here, but Yeti is expecting 7% to 8% growth this year. And that is definitely a high end of its market. So it's definitely a Lululemon problem. I think that if you look, it's struggling in the Americas, not the rest of the world. So to me that says, I have a brand that's recognizable enough to go global, but competitions coming in on my home turf and stealing share. Spot on. I mean, I think I'm not going to say that the consumer is healthy. I think there's better ways to look at the data on that. But there's a real danger in finding patterns in individual retailers. As John said, there's others. Lululemon has a real Lululemon problem. There's a common theme here with Lululemon on and some of these hot retail is dangerous. Hot retail is hot until it isn't. And you have to really call that right. You can make a lot more money on the trendy email. I'm sorry, trendy retail while it's going up. It is a better investment than slow and steady. But when the air comes out of that balloon, it's really hard to refill it. So is this something where the way to play it as investors is just to stay away, Lulule, or is there an opportunity here to buy some of these more value stocks? Because if consumers are spending, some of these companies are still growing. Not every company is dropping 5% or losing customers the way that Nike is. Expectations matter. I mean, I don't think Lulule is going away. It's down almost single digits to earnings. It might be a TJ Max from here. I don't think someone should buy in saying it's going to go back to where it was. But that doesn't mean it can't be a winning investment. My answer is to stay away, though, 'cause retail fashion trends are really hard to get right. - I will say, if you were looking for a chance with on holdings, this is still a really good growth stock, but the valuations now down 70%. So if you were waiting for the air to come out of the balloon a little bit, I mean, this is a good business, still growing nicely. And now it's finally trading at a price that makes sense for a shoe stock. - I also got to take a look at Yeti. So thanks for bringing that one up. All right, let's get to the stocks on a radar. I'm bringing in Dan Boyd for his thoughts behind the glass. John, you're up first, what do you got? - Okay, I got Reddit and this ticker symbol RDDT. Listen, I'm not a huge fan of the social platform, but I do like the business. So this is a platform where people go and they share information. They start little communities. For two years now, it's maintained a growth rate over 60%. A couple of things are happening. There's more users and monetization is going up. So advertisers getting increasingly used to the platform. It's Reddit Max product is automating ads. And this is causing actually this product grew over 150% recently. So that's a big deal. Higher revenue leading to higher profits, operating cash flow more than doubling. And so the net margin here at 30%, that's really good. No debt, great cash position, buying back shares and now trades for only 20 times forward earnings. This is starting to look attractive here. - Dan, are you a Reddit user? - No, I am not. And it's just ads, right? This is the money that Reddit makes? Well, they make money from like Google paying them to get their data into artificial intelligence. So if you do a Google search and you see those AI overviews, a lot of those are coming from Reddit, yeah. - Okay, yeah. No, I don't care about this company one way. John's starting out behind the eight ball. Lou, what do you got for us this week? - And I'm still trying to lose. But I'm channeling old economy run here, Dan. So hopefully that works. Dan, I'm looking at Seco environmental. C-E-C-O is the ticker. What did they do? Provide air quality wastewater management, energy transition, all sorts of products to large corporate customers. These are big things. Think air scrubbers for power plants. Also the kind of to make the, when we're making EV batteries, all of the toxic wastewater and things like that, kind of making sure it doesn't get into the environment. Stocks up 50% over the last year, Dan. I think they're still room to run. We know there's growing demand for power and energy. Thanks to data centers. I mentioned the battery production. Semiconductor manufacturing. They're involved in a lot of red hot markets. It's not a value stock. They traded almost 30 times earnings, but they have a $1.8 billion backlog. A clear path to $3 billion in annual orders compared to $2 billion now. And we're getting towards 20% EBITDA margins manufacturing at scale. I think this is a winner from here. - Dan, I didn't have air scrubbers on my big ol' card for the show today. But what do you think? I feel like the regulatory environment is probably not great for this company at the moment, but that sort of thing tends to be cyclical. I also like that this is a 60-year-old company who's been listed for 40 years, Travis. - All right, so make it official. What's going on in your watch list? No, we're not going to read it. Let's go seeko. All right, congratulations to Lou. For Lou Weiman, John Quast, and Dan Boyd. behind the glass. I'm Travis Hoyam. Thanks for listening. We'll see you here tomorrow.