Motley Fool has been offering stock recommendations and investment advice since 1993. Over two decades later, they are still one of the largest financial media companies in the world. We did an in-depth review of their stock advisor program to see if it was worth the money. Here’s what we found.
In this Motley Fool Stock Advisor Review for 2021, I go over my thoughts on The Motley Fool, whether The Motley Fool is worth it in my opinion, the performance of The Motley Fool Stock Advisor picks over the period of a few months, and The Motley Fool pros and cons. Have you ever used The Motley Fool? Let me know in the comments!
Here’s How Motley Fool Co-Founder David Gardner Finds Multibagger Stocks
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Motley Fool Stock Advisor Review 2021
What Are the Benefits Of A Stock Advisor?
With a good stock advisor, you can benefit from the following ways:
- You get stock ideas from investment experts who have conducted thorough stock research and analysis
- You leverage on other investment professionals’ industry knowledge and also time (i.e. save you a lot of time on research)
- You don’t miss out any good potential investment opportunities because it’s impossible for you to analyze and track every single stock out there (yes, there are almost 4,000 stocks listed on US stock exchanges alone)
How To Choose The Right Stock Advisor
Now, how do you choose the right stock advisor?
Here are the few things I will look at while choosing stock advisors:
- Is it legitimate? ( there are too many online scams, so it’s better to be safe than sorry)
- Who is giving out stock recommendations? Is the person credible and qualified?
- What are its track records? (i.e. do people really make money if they follow their stock recommendation?)
- What are its reviews? (e.g. are there any positive reviews?)
- What is included in the stock advisor service?
- How much is the stock advisor service?
- Is there a free trial or does it come with a money-back guarantee? (you should always be allowed to try out their stock-picking service risk-free before making a decision)
Ultimately, what you want from a stock advisor are good stock recommendations that can give you high returns over time.
By the way, there is a difference between stock picks and trading picks.
As a stock investor, you are buying stocks for the long term (i.e. holding the stock for at least a few years)
But, as a trader, you are just trying to predict the price movement of the stocks in the immediate term and profit from it in as quickly as a few minutes or hours.
A stock advisor is for stock investors who want profitable stock ideas for long term investment.
Now, let’s take a close look at Motley Fool Stock Advisor and see whether it fits all the criteria mentioned above.
What Is Motley Fool?
So, what is Motley Fool?
Is Motley Fool legitimate?
The Motley Fool is a financial and investing advice company that has been around for almost 30 years.
As of 2019, The Motley Fool has operations in the United Kingdom, Australia, Canada, Germany, Hong Kong, and Japan with a total number of 300 employees.
Motley Fool is generally regarded as one of the leading financial websites for stock research and analysis.
So, it’s a legitimate company.
Now, who is behind Motley Fool Stock Advisor?
Who are you taking stock market advice from?
Motley Fool Stock Advisor is led by David Gardner and Tom Gardner, founders of Motley Fool.
So, who is David Gardner and Tom Gardner?
They both began investing at a very young age, and have more than 30 years of investment experience and are best-selling authors of a few investment books.
David Gardner also makes frequent appearances on CNBC to share his views on the stock market.
For me, if I’m taking investment advice from someone, that person should also have made money with their own investments.
So, what’s the net worth of David Gardner and Tom Gardner?
The net worth of David Gardner is estimated to be more than $22 million, while Tom Gardner’s net worth is estimated to be at least $15 million.
Lastly, is Motley Fool well-recognized in the financial industry?
Motley Fool Stock Advisor was highly recommended by the most trusted names in the financial industry.
Is Motley Fool Stock Advisor Good?
So, are Motley Fool stock recommendations good?
Can you really achieve above-average returns with their stock advice?
First of all, let’s take a look at their track record as of June 2021.
Below is the performance comparison between Motley Fool Stock Advisor and S&P 500 between 2002 and June 2021.
As of June 2021, average Motley Fool Stock Advisor recommendations have returned over 592.5%% since inception while S&P 500 has returned 132.3%
So, what does that mean?
If you had invested $10,000 in the stocks recommended by Motley Fool Stock Advisor, your investment portfolio would be worth more than $300,000.
On the other hand, if you had invested $10,000 in S&P 500 index funds, your portfolio would be worth about $50,000.
In short, the Motley Fool Stock Advisor has beat the market 5 to 1.
That’s a HUGE difference in returns.
Now, what about the performance comparison between Motley Fool Stock Advisor and S&P 500 for the past 5 years?
|Year||Motley Fool Stock Advisor
(Average Return to 12th Feb 2021)
(Average Return to 12th Feb 2021)
So, in terms of overall performance, the Motley Fool Stock Advisor has beat the market every single year for the past 5 years. (Note: Performance is calculated from 1st Jan of each year to 12th Feb 2021)
But, what about its individual stock picks?
This metric is important because you might not be buying every single stock recommendation made by Stock Advisor.
Below is a table that shows you the performance of individual stock picks over the years.
As of June 2021, Motley Fool Stock Advisor has had 191 stock recommendations with 100%+returns.
What that means is that you would have easily doubled your money if you had invested in any of the 191 stock picks by Stock Advisor.
Here are just some of their best-performing stock picks:
- Amazon: it’s up 20,255%
- Netflix: it’s up 21,471%
- Walt Disney: it’s up 9,625%
- NVIDIA: it’s up 7,855%
- Shopify: it is up 3,173%
- United Health Group: it is up 2,637%
- Activision Blizzard, it’s up 2,584%
Just imagine that you actually found out about these great stocks way before everyone else did.
What would your investment portfolio be like today?
Maybe you have been hearing about just putting all your money in stock index ETFs.
Yes, investing in stock index ETFs is safe and you will never go wrong with them.
In fact, I also invest in stock index ETFs and it is part of my investment portfolio.
But, the truth is that you will also never get above-average returns by investing only in index ETFs.
A stock index consists of a lot of listed companies.
Some of these companies are great businesses and can stand the test of time and can get through crises like the coronavirus crisis largely unscathed.
But there are also companies that are badly affected by the current coronavirus crisis and might never recover.
For example, all the major airline stocks are doing very poorly and their prospects are not looking good either.
When you buy a stock index ETF, you are inevitably investing in both good and not so good companies at the same time.
So, if you want above-average returns, then one way is to only invest in a handful of selected stocks that will outperform the market in the long term.
And that’s where a Stock Advisor comes in.
Because it scans through the entire stock market and conducts thorough stock research to find stocks with great growth potential.
So, Stock Advisor will always be right about their stock recommendations?
No, because no one will be right about their stock picks 100% of the time.
Even Warren Buffet has losing stocks in his portfolio, but he still achieves above-average returns.
That’s because a few big gainers in the portfolio can make up for the under-performers.
What I like about Motley Fool is that they are very open and transparent about their bad investments.
Did you know that David Gardner has an annual episode on their podcast just to review the bad investments for the year?
During the review, he would share why he picked the stock, what went wrong with the stocks, and also what the outlook would be.
Let me sidetrack a bit here.
If any stock advisor tells you that they have a close to 100% success rate on their stock picks and can guarantee you high investment returns, you should definitely stay away.
Motley Fool Stock Advisor Pricing
Before we look at the prices, let’s look at what you get from your Motley Fool Stock Advisor subscription:
- You will receive two stock recommendations every month, as well as their monthly “Best Buys Now” from legendary investors Tom and David Gardner
- On the first Thursday of the month, you will receive Tom Gardner’s stock recommendation
- On the second Thursday, you will receive Tom’s 5 New Best Buys Now
- On the third Thursday, you will receive David Gardner’s stock recommendation
- and on the fourth Thursday, you will receive David’s 5 New Best Buys Now
- You will receive a real-time email notification when it’s time to sell, so you are never left wondering what to do
- You gain instant access to all past Motley Fool’s Stock Advisor recommendations
- You gain instant access to all of their stock reports
- The Motley Fool’s Top 10 Best Stock to Buy Now report that features some of their recent picks that still offer the best potential return.
- The Motley Fool’s Top 5 Starter Stock features the ideal stocks that should be the foundation of new investor’s portfolios.
Now, consider the fact that many investors have made many profitable investments by following their stock advice, how much would they value the Motley Fool Stock Advisor subscription?
If they have made tens of thousands of dollars based on their stock tips and recommendations, would they mind paying them hundreds of dollars or even thousands of dollars for their knowledge and expertise?
They most probably won’t mind at all.
Here’s the fact.
Motley Fool Stock Advisor does not cost thousands of dollars.
It does not even cost you a few hundred dollars.
So, how much does Motley Fool Stock Advisor cost?
Its annual membership is only priced at $199 a year.
So, for $99 a year- that’s just $1.90 a week – you can gain unlimited access to their library of expert stock recommendations which are carefully selected to help you grow your wealth.
Is Motley Fool Stock Advisor Worth it?
So, is Motley Fool Stock Advisor worth it?
Okay, let’s first look at how much you can get from $1.9 a week.
As you already know that your Starbucks coffee cost at least $4, “$1.9 a week ” is even less than half of the price of your Starbucks coffee.
Now, instead of buying one more cup of Starbucks coffee, what if you invest $1.9 a week on a good stock advisor with a proven track record?
What could that small investment bring you?
And what difference could it make on your investment portfolio and therefore your life?
Earlier on, you’ve already seen that if you had invested $10,000 in the stocks recommended by Motley Fool Stock Advisor, you would have increased your investment portfolio by over 2500% to about $250,000 from 2002 to 2020.
That’s not to say that it’s guaranteed that you will get the same impressive returns, but that’s the kind of potential returns you might see with your investment portfolio.
So, I would say that it’s really worth it to get Motley Fool Stock Advisor because the value you are getting from it far outweighs the cost.
Here’s the best part.
When you sign up for the annual membership, you are protected by The Motley Fool‘s 30-day membership-fee-back guarantee.
What this means is that if you decide Motley Fool Stock Advisor isn’t for you, simply cancel your 1-year subscription within the first 30 days (it’s quick and easy to cancel), and you’ll be promptly refunded 100% of your membership fee with no questions asked.
What’s more, everything you see during those 30 days – the expert stock picks, the best buys now, the premium research and reports – are yours to save and keep.
So, it’s 100% risk-free for you.
Claim Your 50% Discount Off Motley Fool Stock Advisor (For New Members)
Who Is Motley Fool Stock Advisor For?
Now, who is Motley Fool Stock Advisor for?
If you are serious about getting into investing and want to grow your wealth through stock market long-term investing, then I highly recommend Motley Fool Stock Advisor.
It’s especially good for investors who are too busy to do the stock research and analysis themselves and want to leverage investment experts’ knowledge and time.
So, who should not get Motley Fool Stock Advisor?
If you are looking for stock ideas to make money in the short term (within a couple of days or weeks), then it is not the right fit for you.
Try out Motley Fool Stock Advisor For 30-Days Risk-Free Now
Motley Fool Stock Advisor Vs Zacks Premium
First, let’s compare Motley Fool Stock Advisor with Zacks Premium.
Zacks Premium is another stock-picking service that has been around for many years.
So, what is Zacks Premium, and what do you get from Zacks Premium?
Zacks Premium is a paid subscription service to provide stock traders and investors with investment tools and research called “Zacks Rank”(i.e. a type of stock rating)
Unlike Motley Fool Stock Advisor, it does not give you specific stock picks with clear buy and sell recommendations.
Instead, what it does is that it assigns a Zacks Rank to each of the stocks that it tracks to help you make your own investment decision.
Zacks’ stock ranking is founded entirely on one premise:
“Earnings estimate revisions are the most powerful force impacting stock prices.”, according to Zacks’ Founder and CEO, Len Zacks,
So, what that means is that if the stock’s earnings estimate is revised higher, then the Zacks’ rank of the stock will be high.
Conversely, if the stock’s earnings estimate is revised lower, then the Zacks’ rank of the stock will below.
Also, it gets all the earnings estimates from the brokerage analysts who follow the stocks, so it does not come up with the earnings estimate itself.
Instead, it takes all the earnings estimates and plugs them into a mathematical formula to generate a Zacks Rank every night. (yes, the ranking is updated daily)
However, these stock ratings are ONLY for short term trading (i.e. the next 1 to 3 months), but not for long term investment.
Publicly traded companies are required to report their quarterly earnings, so the “earnings estimate revisions” indicator that Zacks uses is ONLY valid for at most one quarter.
So, in terms of stock advice, Zacks Premium offers Zacks Rank #1 stocks which are good for short term stock trading (i.e. it can be used to help you predict the price movement for the next 1 to 3 months).
Basically, these are NOT specific stock trading picks with buy and sell prices.
It’s just a tool (i.e. Zacks Rank) that you can use to help with your own stock trading analysis.
On the other hand, Motley Fool Stock Advisor offers you specific stock picks for long term investment (i.e. hold the stocks for at least 1 to 3 years) with detailed research reports which outline the reason behind the recommendation.
For all the Motley Fool stock picks, they will send you real-time updates on the stocks whenever there is any news as well as real-time alerts when they think it is time to sell.
So, you won’t be left wondering what to do after you decide to follow their stock recommendation.
In terms of stock-picking strategy, Zacks essentially uses a single indicator called “Earnings estimate revisions” and a mathematical formula to calculate the stock rank.
On the other hand, Motley Fool uses a time-tested investment strategy with strict stock selection criteria to make stock recommendations.
In terms of track record, Motley Fool has a very impressive track record.
As of December 2020, average Motley Fool Stock Advisor recommendations have returned over 546%, with 183 stock recommendations with 100%+returns.
For Zacks Premium, it says that it has more than doubled the S&P 500 with an average gain of +23.5% per year from January 1, 1988, to May 4, 2020, with Zacks #1 Rank stock list.
Personally, I find this claim a bit confusing because they don’t give specific buy and sell recommendations.
First of all, let’s just assume that its subscribers buy the stocks immediately the minute it appears on the Zacks #1 Rank.
Motley Fool Stock Advisor Vs Morningstar
Now, what about Morningstar Vs Motley Fool?
Both Motley Fool and Morningstar give investment advice to individual investors, but there are a few key differences between them.
First of all, Motley Fool focuses ONLY on stock recommendations while Morningstar offers analysts’ ratings and analysis on stocks, bonds, and ETFs and mutual funds.
For Motley Fool, you will get specific stock recommendations with reports that detail why they are optimistic about the stock.
On the other hand, Morningstar only updates and maintains a list of stocks whenever there is a change in analysts’ ratings.
They don’t give you specific recommendations on exactly what stocks to buy, so you still have to do your own research and make your own investment decision.
If you are interested to invest in funds or bonds, Morningstar gives you a list of recommended funds and bonds which Motley Fool does not.
In terms of investment performance, Motley Fool has a proven track record with its stock picks outperforming the S&P 500 for the same time period between 2002 and December 2020.
- Motley Fool Stock Advisor: 546%
- S&P 500: 111.9%
On the other hand, Morningstar does not give specific stock picks, so there’s no way to calculate its performance.
In terms of pricing, both Morningstar Premium and Motley Fool are quite affordable.
Both Motley Fool Stock Advisor and Morningstar Premium cost about $199 a year,
For Morningstar Premium, there is a 14-day FREE trial, which means you can test-drive its product and services risk-free for two weeks.
So, for $99 a year- that’s just $1.90 a week – you can gain instant access to Motley Fool’s Best Buys Now.
Try out Motley Fool Stock Advisor For 30-Days Risk-Free Now
All in all, Motley Fool Stock Advisor is a legitimate stock advisory service with a proven track record. The value you get from this investment subscription service is tremendous, considering all the good stock opportunities and what it could mean for your investment portfolio.