It’s SpaceX IPO Day!

In this episode of Motley Fool Hidden Gems Investing, Motley Fool contributors Travis Hoium, Lou Whiteman, and Jon Quast discuss:

• SpaceX IPO.
• Who will sell SpaceX stock?
• What’s wrong at Adobe?
• Is Apple all right?
• Stocks on our radar.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on June 12, 2026.

Travis Hoium: It's SpaceX IPO Day, and Motley Fool Hidden Gems Investing starts now. Welcome to Motley Fool Gems Investing. I'm Travis Hoium. I'm joined today by Lou Whiteman and Jon Quast, and we have to start with the news of the day. That is the SpaceX IPO. This has been coming for a while. It's been a huge topic. Retail investors, who are the people that we talk to, are going to be a huge piece of this. I want to go through an overview and get all the way down to when are some of these big owners going to sell. But Lou, let's start here for investors who are maybe new to this IPO process who've never bought an IPO or a stock that has started their initial trading, like SpaceX is going to do today. What is an IPO and why is it important?

Lou Whiteman: An IPO, initial public offering, is the process through which a private company becomes a publicly traded company. All companies have shares, private or public. But before the IPO, SpaceX shares were held by investors who had invested early on, venture capitalists, insiders, not easily traded on the open market. What SpaceX is doing is they're selling a small sliver of themselves, some percentage of their shares, in this case, I think, under 10%. Over time, all of the shares will become tradable. This allows both retail investors like us non-venture capitalists to get in. It also allows for big holders to get out. It's just the process of becoming more easily tradable, or as we call it, public.

Travis Hoium: We'll get to that selling piece in just a moment. But Jon, why is this IPO in particular such a big deal?

Jon Quast: Because it's the biggest IPO of all time, and it's not even close. 2019, Saudi Aramco went public, and its IPO, it raised about 25 billion. SpaceX is looking to raise 75 billion, so three times the size of the last biggest IPO. This is absolutely enormous, and when you think about the timing here, I know we're going to get into this more, but when you look at Anthropic, OpenAI, also looking to go public in the near future, you look at even a company, we shouldn't forget about SK Hynix from South Korea, looking to go public here in the U.S., it's already publicly traded in Korea, but publicly traded here in the U.S. at maybe $1 trillion valuation as well. We have a cluster of four potentially trillion-dollar companies going public at the same time, maybe 200, 250 billion raised in IPO proceeds all at once. I don't know. We haven't seen that before.

Travis Hoium: Lou, this does seem like a unique moment and we had a little bit of this during the pandemic. There was a lot of those SPACs, SPAC-mania. That was very different companies that it seems like we have today. SpaceX is a very real company doing very real things. We've done shows if you want some deep dives, we have some of those in the back catalog for Motley Fool Hidden Gems Investing, and you're going to be doing some content on The Motley Fool today and over the next few weeks or so about this. But this is a moment where you're going to see potentially $3 trillion companies coming to public markets in 2026. The scale of that is just something we've never seen.

Lou Whiteman: This is not what the IPO market was made for, for honest. Some of these things, all this talk about, well, they're bending these rules, they're changing these rules. I'm sympathetic to that, but also the rules never envisioned companies this size. It's important to say, yes, a lot of money is coming on. There's a lot of questions, and I don't think any of us really know the answer to what this will do for the market because it should pull money away from elsewhere. By the St. Louis Fed, there is $8 trillion on the sidelines, as they call it. That's money in money markets. Not all of that is looking to get in, but there is a buffer there. Trying to do the back of the envelope, if all three go public, what we're thinking, maybe 5-6% of total market capitalization of the U.S. markets. That's a huge number. But it's not a relatively massive number. I think over time, the market can handle this, but I do think that, yeah, we could be in, even if you have no desire to get in on this offering and just want to watch it from the sidelines between your index funds and just what it does, the pulls on other stocks, almost everybody invested in U.S. markets is going to feel this somehow, at least in the short term.

Travis Hoium: Jon, let's be honest about what this is for a lot of investors. This is a liquidity event. This is an exit for them. I follow a lot of venture capitalists on Twitter and places like that. They're looking at this as a huge day because this is when they get their money out. Talk to me about exactly what that means and what the IPO means. If you're Elon Musk or if you're investors in SpaceX, you don't typically want to do this in a down market, you want to do it in a market like we have today where, hey, what's $1 trillion here or there when you're talking about valuation?

Jon Quast: Absolutely. I think that that is the clearest of all signals for why there are potentially four trillion-dollar companies coming public at the same time? It's because the getting is good and you've got to get when the getting is good. You've heard of sell high and buy low. Well, these companies and these venture capitalists who own shares of these privately held companies, they want to sell high, and this is an opportunity. The market is quite hot right now. I believe that we could even say it's overvalued right now. I think some of our listeners just heard me say the market is going to crash. I didn't say that. I said the market is overvalued right now. This is a good time to be a seller if you want to raise some money. And that goes for the companies themselves, but as you point out, the venture capitalists. I love the Warren Buffett quote, "The only reason to put money into a company is so you can have more money later." These venture capitalists, they want to have a way to have liquidity, get their returns on investment that they've had so far, so they need this.

Lou Whiteman: Just one thing on that liquidity in terms of how it affects the market because that is my focus right now. What we know is is that venture capitalists over time will be free to do something with their shares. We don't know what they're going to do. A lot of these institutional owners, what they'll do is distribute, not sell. They will give it back to their limited partners in the form of shares and let the limited partners decide what to do with it.

Travis Hoium: Who are those limited partners? Let’s get to that a little bit, because this is not just rich people; this is actually a lot of people who are listening to the show, probably have some exposure through something like a pension fund.

Lou Whiteman: Pension funds, endowments, definitely rich people, too, a lot of people. But yeah, no. Look, there is no one-size-fits-all answer. There will be liquidations, there will be partial liquidations, but there will be some that say, I believe in SpaceX, I want to own these shares. I know you're here for answers, but there is just no way of knowing. There will definitely be an impact here. There will definitely be people seeking liquidity. That also creates new opportunities because if there's a lot of cash created, then that's money that could be spent to buy other companies. If you're selling SpaceX, there's going to be a lot of near-term movement. How it all nets out? I don't think any of us really know. I think the market can digest it over time, but look, indigestion happens, even if it's short term, and we could get indigestion here.

Travis Hoium: Now, this is an IPO that I don't plan on buying, so let’s just put that out of the way. Do you guys fall in the same boat?

Lou Whiteman: Yeah.

Jon Quast: Yes.

Travis Hoium: But I do have exposure to this, and this is something that I think we should touch on is a company like Alphabet is a big holder of SpaceX, invested $10 billion or so over a decade ago at this point. They have about $100 billion stake, Lou. That's money that if they sell that $100 billion stake, they could just turn around and pour that into artificial intelligence. We talked this week about they are raising $80 billion in equity because they don't want to take on a whole bunch of debt to do this AI build-out. What do you think a publicly traded company like Alphabet is going to do with their shares of SpaceX?

Lou Whiteman: We'll get to that in a second. The first thing, though, I think we should say is that as retail investors, we should not take this as a signal. We always talk about we don't give individual financial advice because everyone's situation is different. Alphabet's situation is different than yours. You're going to hear it like, well, if Alphabet thinks it's worth holding, then it's worth holding for me, too, and read it that way. That is the wrong answer here.

But it's a great question because it's a lot of money. There are a lot of ways that they could hedge their economic exposure or even monetize that stake without selling. Even if we see it stay on the books, that doesn't mean they aren't finding ways to put it to work. I would assume that over time, it's not core, but I would also assume they're not going to be in a hurry. They still own a huge portion of ASTS for the same reason. They could monetize that at a huge gain. My guess would be that they will hold tight with it for now, at least on the surface, from what we can see. Again, there are ways to monetize it or put it to work elsewhere. I guess they'd be more inclined to do some of that than they would just to sell this in the near term.

Travis Hoium: Jon, historically, what do we know about what a company like Alphabet will do with their shares?

Jon Quast: It might be surprising to our listeners that Alphabet owns shares of a company, but it's actually not unusual at all with its Google Ventures in the past. I think it's just called GV now, but it's invested pre-IPO in companies such as Uber, Lyft, and Robinhood. When those companies went public, it didn't sell right away. Now, it did afterwards sell, but Robinhood, it waited a couple of years. Uber and Lyft, it waited longer than that. It did eventually sell, but it patiently held those stakes even as they increased in value early on. I think that that would point to probably Alphabet, if it is going to be a seller, probably wouldn't be a very quick seller here, would probably hold on to the stake just using history as a guide. That said, back when it held those stakes in the other companies, it wasn't looking at potential negative free cash flow like it is right now. It is different circumstances this time than in the past, so take it with a grain of salt, but the historical pattern is hold.

Travis Hoium: The other thing that I think is interesting, especially with a lot of these tech companies, when one of these big tech companies invests in a company that could potentially disrupt them, or could play a big role in the market, and they sell, that's usually the wrong time to sell. Microsoft had a huge stake in Meta, for example, or Facebook back then. Sometimes, if they just hold onto these stakes, that's the right thing to do. SpaceX — obviously different for a million different reasons, partly because it's almost a $2 trillion valuation as it goes public.

When we come back, we're going to get to another publicly traded company that is not going in the right direction. That's Adobe. You're listening to Motley Fool Hidden Gems Investing.

Welcome back to Motley Fool Hidden Gems Investing. Shares of Adobe are down over 8% in trading on Friday. That's after falling yesterday. Even before they were announced earnings that came out after the market closed yesterday. Lou, there's a lot going on with Adobe. This is seen as one of the companies that could potentially be an AI loser, and yet, their numbers look fine, so what in the world is going on?

Lou Whiteman: Down 8.5% this morning after what looks like a great earnings report to me. This one frustrates me because I am on the camp that thinks they are not going to be wiped out by the AI software invasion, so I own this one, so not enjoying this. But look, the numbers were really solid. They were great. They've been on the top and bottom line; they raised revenue and earnings guides for the year. They're seeing good traction with their AI products. I think AI-related recurring revenue was tripled. But there is C-suite turmoil, and this is not a good time for that. The CEO who's been with the company since 2007, not retiring until a replacement is found. I didn't find that particularly scandalous. It's not great timing, but look, this is retirement. He's earned a gold watch.

The latest news is CFO Dan Dern will report. To me, it will leave, sorry, not report. To me, this is more of a sign that Dern was not going to get the job. There are internal candidates here. There is a process. If I'm Dern and I am not on the short list to get the CEO job, maybe I move on. Again, I don't think this is red flags, but it adds to the turmoil. There are some things that we can get into it. I don't think the quarter was perfect, but I think this is just, I don't know. It's hard to just ignore all the noise and look at the numbers because the numbers could change. The SaaS apocalypse could be right around the corner, but I just refuse to think these businesses are going to be destroyed until I actually see it in the numbers. I think, absent just the natural CEO life cycle playing out, I got to think the market would be happier today.

Travis Hoium Jon, the odd thing looking at this is as I looked through the numbers, I didn't see any major red flags. I need to dive a little bit deeper. But you do look at that C-suite turnover, and it has you scratching your head a little bit, the CEO leaving, like Lou said, been there forever. But the CFO, then you look at his history and where he's going. Look, Marvell, going from a company that’s going, a stock that's going down to a stock that's going up in a hot segment of the market, probably got a great offer. I don't know. I go, maybe this is just about getting a bigger paycheck elsewhere.

Jon Quast: It is possible that Adobe was passing Dern over for the CEO role. He feels slighted and is going outside the company now. That's possible, but let's not kid ourselves here. This is a promotion in many ways. It's a better career opportunity for Dern, in my view, because as you point out, Marvell much bigger and growing faster. It just seems a way brighter outlook for the company as opposed to Adobe right now. If I'm Dern, I think I take this as well, regardless of what's going on at Adobe because everything looks so great at Marvell. You look at this, you asked, Travis, before the show, at what point is Adobe worth buying or something like that? Because it's trading at eight times forward earnings right now. The numbers did look good, and I'll concede that point. At what point do we start to believe this? Here's the question for me: I think that the struggle to believe Adobe right now is what is the plan, and who is bringing the plan? Because the CEO and the CFO are now both out, so they're not bringing the plan. The plan that they are presenting, there might be some question marks there.

Travis Hoium: Lou, we talk a lot about management. It's sometimes really hard to judge management. This is where the board of directors earns their paycheck because the job of the board of directors is to set the vision for the company and then hire the people that are at the top. When you have to hire a new CEO, especially at this moment when there could potentially be disruption, you talked about the SaaS apocalypse. This almost seems like a time where you're either going to go in the wrong direct. It's like a binary outcome. If you have a company trading for eight times forward earning earnings, you're either going to go in the wrong direction, and we're going to look back on this and going, look, the market saw this coming a mile away, or you're going to do a turnaround, and it's, maybe not Steve Jobs coming back to Apple, but somebody comes in with a new plan and says, hey, I have the ability now that the stock is down, now that we're unloved by the market to come in and shake things up and say, this is where we need to go.

Lou Whiteman: If I could ask anything of Shantanu Narayen, the CEO, why now? You've had a good run, can't you stand a little longer? Because, to Jon's point, you're right, this is a terrible time to have to be saying we don't have long-term certainty. They don't have a credible plan right now because whatever they come up with, could be around to implement it. They need a new CEO to just say exactly that. I do think that as you say, this is a great opportunity for someone to come in and do it. I think messaging can be improved from here. Quarter wasn't all great. They are delaying pricing initiatives, they lower their outlook for recurring revenue. They are trading growth for active users right now, just trying. I think the idea is, the thought is, let's make sure the foundation is great for the next person. But again, it is just a crummy time to be waiting. Wait and see, we're going to get someone in here who will know what to do is not a message the market wants to hear right now. Maybe it's just stay on another two years or something. I don't know.

Travis Hoium: Jon, is this just one of those instances where it seems like we fall into this with something like PayPal, too, where it does look cheap, but that doesn't mean the stock's going up for a while.

Jon Quast: That's absolutely right. Why do stocks go up over the long term? They go up when they are able to grow their businesses and become a better profit machine. There are some legitimate question marks there. It wasn't screaming red flags, it wasn't a terrible quarter, but there are questions, and so to Lou’s point, chasing user acquisition more, the CEO's saying, we're going to chase lifetime value with more premium offerings. Chasing those free-tier products, but you're going to have to spend to advertise to get those users there. Little data point here, first half of fiscal 2026, sales and marketing up 15%, revenue only up 12%. That's just a minor little thing that we need to be watching here, especially with questions about the long-term vision.

Travis Hoium: Definitely some questions, but the valuation is very compelling, so I'm going to be digging more into. When we come back, I'm going to get some thoughts on some valuations and which stocks Jon and Lou like. You're listening to Motley Fool Hidden Gems Investing.

Welcome back to Motley Fool Hidden Gems Investing. In this segment, we like to have a little bit of fun with stocks that we follow. I want to play either or neither, and I'm going to give Jon and Lou two stocks. I'm going to say, which one do you like better? But I do give you the option to say, I don't like either of these. We've talked about SpaceX, but let's talk about the other Elon Musk company. Crazy that somebody's going to be the CEO of two trillion-dollar companies, I guess and potentially be a trillionaire himself. Lou, Tesla or SpaceX stock, or neither? Which one do you like here?

Lou Whiteman: I want to be that guy here and say, in six months, they're going to be one company, so you don't have to choose. But no, I do think they'll merge. I don't think it's that soon. I would probably go with SpaceX just because I do think it's the newer, fresher story without dents. My honest answer is neither, though. Valuation, I can't really get my head around either.

Travis Hoium: Jon?

Jon Quast: I think I would take Tesla, and mostly because I see multiple ways for it to win. You just have to have a very long time horizon when it comes to Tesla because one thing is for sure, whatever it's saying it's going to do, it will not be on time. Just take that with a grain of salt. But battery technology, I think that is an increasing potential avenue for — I just think it's a huge area of growth in our world, battery technology. You do look at the robotics that it's working on. Yes, not on schedule, but very interesting work that's happening. You do look at the robotaxi efforts. Definitely, the rollout was supposed to be a billion times bigger by now, but I think it is going to happen, and I do think that that is accretive to the business. I see many ways for Tesla to win. SpaceX, on the other hand, I'm uncertain with how much capital expenditures it's plunging into AI.

Travis Hoium: You’re not worried about Tesla's increase? I think the 25 billion that they're putting to AI compute. That one doesn't worry you as much?

Jon Quast: I think it's even higher with SpaceX, and then on top of that, you have rockets that you need to build that are also expensive. I see better economics for Tesla.

Travis Hoium: Let's get to the other company that we talked about. Adobe. Another one that I'm looking at this falls into this. Is this a value or a value trap Intuit. Jon, you're up first. Do you like either of those or neither?

Jon Quast: My honest answer would be neither. I wouldn't be investing in either of these companies right now on a personal level. However, if you did make me choose, I think I would choose Adobe over Intuit. The reason why is that Intuit does more of its business — it does have a large enterprise customer base, but the consumer base is much larger of a percentage of the business, and that worries me. I think that consumers are curious about other tools right now. Adobe, I think there is a little bit more stickiness with its enterprise revenue base. I do think that that is a little bit more sticky. I think that enterprises in particular are looking for a company such as Adobe to come in and help me do AI, not how do we replace Adobe with AI. I think that Adobe has a little bit more staying power.

Travis Hoium: Lou, I'm going to give you a couple of numbers here. Forward Price Earnings multiple for Adobe is eight. We talked about that earlier, Intuit, it's 16. But is Jon right that the potential for disruption of just, I don't know, sticking your tax information in ChatGPT? Is that the disruption? I've never thought of paying $100 or $200 to TurboTax to my taxes for me, essentially, is all that big a deal? That's a pretty valuable service.

Lou Whiteman: I don't think the consumer tax side of it is the part that we're really worried about here. There's a lot of just back-end small business number flows that maybe I think that's a bigger risk. I do think that's application where it's just zero creativity, zero judgment, shall we say, is more ripe for disruption. I've already told you my bias. I own one of these. It's Adobe. Part of it is I just don't like Intuit. I think Intuit is done, they've played games with the tax code I know that's particularly trust. That's just a personal bias here, but I do think of the two, if either is disrupted, it's going to be the one that is basically just a spreadsheet jockey and not a human judgment type of business.

Travis Hoium: I buy that argument, guys. You're talking me out of Intuit. Let's get to the home improvement side. Home Depot shares trade for 23 times trailing earnings, not growing all that much, just 3% a year over the past three years. Lowe's trading for 19 times earnings, actually down in terms of revenue over the past three years. Lou, do you like either of these or neither?

Lou Whiteman: Home Depot has always been the stock to own. It's always been the better of the two really good companies, not for growth, but because they generate cash, and they use that cash to buy back shares. It is a total return story. They, and to a lesser extent, Lowe's have changed focus of late. They're spending a lot of money on acquisitions, trying to build other sides of the business. That is going to slow, at least in the near-term returns to shareholders, because they have a lot of debt to pay off. I actually think if I had to buy one of these today, I would buy Lowe's. I think it's the first time in my investing career I felt that way. I just think they are operating a little better, a little more focused, and you do get a little bit of a better deal.

The real striking thing to me about this is that everybody knows these are great businesses for that reason. They have not fallen as much as homebuilders in some of these other areas with interest rates up and with the homebuilder I don't know. We're even start on the home issues. I think, though, you're not getting as good of a sale. Maybe I'm less inclined to jump in right now, but these are quality businesses.

Travis Hoium: Jon?

Jon Quast: There have been times in the past where I felt like Lowe's was clearly the better value and clearly had opportunities to improve its business.

Travis Hoium: I totally agree. Yes.

Jon Quast: To have that relative outperformance. I wouldn't say that right now. I feel like they're both in the same place right now, same outlook, more or less. In that scenario, and with a higher dividend yield, I would take the historically stronger business and that's Home Depot. Nearly a 3% dividend yield. That's pretty good compared to Lowe's just two. But I don’t think you’ll go wrong with either company here if it’s just a set-and-forget-it investment.

Travis Hoium: It's one of those businesses that I think is a really good learning lesson if you just look back through their history because Home Depot has been the outperformer. I don't know what the magic sauce is there, because I go to Lowe's stores. I actually like the stores better. I don't know if the lighting is a little bit brighter or something. But there's never anybody there. Maybe that's a regional thing where we are here, but you see it in the numbers, too. They just don't do the same volume that Home Depot does. Home Depot's just always busy. There's people there buying stuff, and that's what the business is all about.

Let's go back to big tech. Microsoft trading for 23 times trailing earnings, about 20 times forward earnings estimates. Alphabet, trading for 27 times trailing earnings. A year ago, this was completely backwards, but Alphabet has been on an absolute tear and 27 times forward estimates. Jon, do you like either of these stocks or neither?

Jon Quast: Yeah, I love Alphabet. I think that this is just a great business all around. I wish I would have bought it a year ago, but I don't think it's a bad investment today.

Travis Hoium: Are you worried about the money that they're putting into AI and potentially 2% dilution with their $80 billion raise? Uncertain if there's going to be ROI on that. I think that's what the market's starting to think about.

Jon Quast: Fair point, but of all the companies out there doing it, I think that Alphabet is the one that is going to get the ROI. If other companies aren't going to, Alphabet will, and that is because of how Alphabet can monetize it throughout its entire ecosystem. I think that's a really important distinguisher.

Lou Whiteman: They just have so many ways to win here. That's the important thing. Look, just to play the game, I will say Microsoft because it is a slightly better deal right now, but the truth is that investors aren't playing a game. You can buy both. In this case, you're fine. These are two excellent companies. Even among the Mag 7, these are the two companies that just have the most ways to win, the most irons and different fires, the most different customer bases to deal with. These are the cream of the crop, and you really shouldn't choose one or the other.

Travis Hoium: Let's end on this. The retail battle that I think is fascinating for investors, Walmart currently trading for over 40 times earnings. You can get Microsoft for about half of the price to earnings multiple as Walmart just wild where we are with the market. Today, against Target, now, even after a really nice run, still only trading for 18 times trailing earnings, 16 times forward earnings. Lou, if you've got to pick one of those, which one do you like, or is it neither?

Lou Whiteman: I own Walmart here, so I guess I can't say neither. I will say, it really depends on time frame right now. If you're talking short term, I think Target will outperform Walmart over the next six, 12, maybe 18 months. A lot of that is regression to the mean in both ways. Target was really beaten down, and they are actually showing signs that they have a pulse, and they're not going the way of JCPenney's. That's good. That is causing a value re-rate there. Walmart, on the other hand, has been on an incredible run, and not a sustainable run the way they're going. The stock is coming down to Earth; I think that's probably going to continue. Longer term, I love the way Walmart is positioned. I still don't know what target wants to be when they grow up. I don't know what urgent need they fill that you can't do elsewhere, which is a tough place to be in retail. I think they have to answer that question for me. Long term, I'm sticking with Walmart, but near term, I would expect Target will outperform.

Travis Hoium: Jon?

Jon Quast: You look at both of these businesses. I don't think the growth outlook is anything to write home about for either company right now. That is important when it comes to investing. How much can this business grow? That said, when you don't have the growth, you do look at, what is the margin opportunity here, and hats off to Walmart. It's doing really well on the profit margin front right now, and that is part of the reason why investors have been so excited about it. Does that keep getting better? Man, it's already pretty good.

Target, on the other hand, has opportunities to turn around and to Lou’s point, they show that they have a pulse. They are starting to show that maybe a little bit of this opportunity that we have to do our business better is starting to pay off, but that still has a long way to go if it is indeed the early stages of a turnaround. I would take Target here of the two.

Travis Hoium: Interesting thoughts on companies across the market. You can see that the valuations are just wildly different, depending on where you're looking at stocks today. We'll see how this plays out long term. When we come back, I want Lou and Jon's thoughts on the latest from Apple. You're listening to Motley Fool Hidden Gems Investing.

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Guys, I wanted to touch on WWDC. This used to be one of those huge events from Apple, they had a couple events every year that in the late aughts, early 2010, these were some of the biggest moves for the market because this is when new products came out, when new software came out. But WWDC was, I would say, a little bit of a dud this year. Just not a lot happening. There's a lot of under-the-surface things that are going on. Siri is apparently what they promised a couple of years ago, and they talked a lot about parental controls. If you're a parent, maybe this is going to be really helpful. I'm excited about some of those features. But Lou, when you look at something like WWDC, is Apple just moving out of the spotlight? They're not spending a bunch of money on AI. There's not really a huge AI story, but maybe from an investor's standpoint, that means they're not burning a bunch of cash, and maybe that's OK.

Lou Whiteman: Yes, I think they're fine on AI. We've talked about this, but using someone else's stuff and getting it out over your massive customer base, that's the way to go. That's a lot better than reinventing the wheel. But look, Apple has replaced Microsoft as the most boring big tech company. Whoever thought this company could be so boring? I mean that as a compliment. The good news is this is a well-protected franchise that makes money and should be able to do that well into the foreseeable future. This is a massive profitable business. The bad news is there's no sign that the next big thing will ever arrive. Maybe that'll change with new management. They got a product guy coming in, but it is just the expectations game is now slowly turning in Apple's favor. We are just all accepting like, this is what it is, and fortunately, what it is is a fantastic generator of revenue and profits.

Jon Quast: You point out the parental controls there, Travis. That is not innovation. That's just a business doing business, and that's what WWDC was.

Travis Hoium: A lot of the things that they introduced, I thought that we had the capability of doing as parents, to be honest.

Jon Quast: That's exactly right. There is no big thing here, and I think it's OK. Actually, as I look at where we are now, I don't think this was true of every company, but the way that Apple played this entire AI Supercycle, I think it played it perfectly because, to Lou’s point, it's having other people do all the expensive stuff in creating the AI models and it's like, I'll pay for that and use that. Now, I'll integrate that into what I offer. But I'll just focus in on the hardware, and that's actually been where the money has been right now. I think that's where the money could continue to be for Apple. There's a trend that's going to emerge. I'm calling it now. It's called local AI. This is basically, I'm going to start moving some of my AI compute to where I am. Actually, Apple devices are incredibly proficient at handling that because of how they're made. They’re more energy efficient because of the ARM-based architecture. The high bandwidth memory. They can get a lot done. I think that Apple's going to lean into the hardware angle, and that could be where the more money is made.

Travis Hoium: Yes, to that point, they did not introduce a new Mac Studio. That's the product. I'm actually waiting to get the next-generation Mac Studio because their chips were a little bit goofy in the last generation. But that has been delayed theoretically into the fall because of the massive demand that they have for chips. This AI shortage for chips is now starting to hit Apple in that way. It is interesting where they sit. I think you're right, Jon. They have a very strong position with their products. The downside is they're now behind companies like Nvidia when you go to TSMC. Who gets their chips first? Apple's no longer running the show over there, that's starting to impact products like that, but it definitely seems like if we do more on device compute, they're sitting in a pretty good spot.

We like to end the show with stocks on our radar, and we bring in Dan Boyd from behind the glass for his thoughts. Lou, you're up first. What's on your radar?

Lou Whiteman: Dan, this week, I am going to Casey's General Stores, ticker C-A-S-Y. This is one of the biggest gas station chains in the Midwest, but also, so much more, Dan. Would it surprise you to hear that Casey's is also the fifth-largest pizza chain in the U.S.? Unlike a lot of other fast-casual restaurants that have taken on a chin of late, Casey's is thriving. The company beat on the top and bottom line thanks to strong gas sales and yes, pizza. Inside same-store sales, so excluding gas, were up 5.5%. Margins increased to 120 basis points. They have all pricing power with their pizza, either. Casey's is forecasting 8-10% full-year EBITDA growth next year and is likely to open more than 100 new locations. It also just raised its dividend by 14%. A lot to like here, not just a pizza.

Travis Hoium: Dan, what do you think about gas and pizza?

Dan Boyd: What are we doing here, gang? Pizza from the gas station? Come on. We can do better, Midwest. We can do better, Southern United States. Come on.

Lou Whiteman: Let's do a road trip. Let's go eat the pizza. I'm dying to try it.

Travis Hoium: I think we should do that. We can do a show from the road. The other thing, Jon made this point before the show, but in a lot of places, Casey's is the local place to grab a pizza, if you want. If you're driving through, live in Minnesota. If you're driving through a small town in Minnesota, Casey's is the only place to stop. Jon, what's on your list this week?

Jon Quast: This week I'm highlighting a company called FormFactor that is ticker symbol F-O-R-M, about a $10 billion company. Let me set this up. Nearly every AI chip in the world passes through a probe card before it ships out. Basically, a chip can have problems, and you don't want to package up broken ones. The probe cards basically check the chips for electrical problems. Most people have never heard of FormFactor, but it's actually one of the world's leading companies in making these probe cards doing over 800 million in trailing 12 month revenue. Here's what's really interesting to me. Its largest customer is South Korean memory giant SK Hynix nearly 30% of revenue. Now, last week Nvidia and SK Hynix signed a multi-year partnership to create more memory products. More memory means more probe cards. That should also mean more business for FormFactor. I should also mention that Nvidia itself is a 10% customer for this company as well. There are risks, trades at over 25 times 2030 earnings targets, according to management, so it's not cheap. But this isn't a bet on which model will win. This is a bet on that there will be more chips and that they will need to get more complex, and so that's more business for FormFactor.

Travis Hoium: Dan, what do you think of FormFactor?

Dan Boyd: Brother, I barely understood a single word he said in any of that. But you know what I do understand, even though I was poo-pooing it just a moment ago, is gas stations and delicious pizza. I think I'm going to go with Casey's this time around.

Lou Whiteman: I'm with him with pizza.

Travis Hoium: Props to Jon for bringing a new stock to my attention, so I appreciate that. But yes, I appreciate Casey's business maybe a little bit more. That's all the time we have for today. Thanks to Lou and Jon and Dan behind the glass. I'm Travis Hoium. We'll see you here tomorrow.

Jon Quast has positions in Lyft. Lou Whiteman has positions in Adobe, Taiwan Semiconductor Manufacturing, and Walmart. Travis Hoium has positions in Alphabet, Lyft, Robinhood Markets, and Uber Technologies and has the following options: long December 2027 $20 puts on AST SpaceMobile. The Motley Fool has positions in and recommends AST SpaceMobile, Adobe, Alphabet, Apple, Home Depot, Intuit, Lyft, Marvell Technology, Microsoft, Nvidia, Taiwan Semiconductor Manufacturing, Target, Tesla, Uber Technologies, and Walmart. The Motley Fool recommends Casey's General Stores and Lowe's Companies and recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy.