This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Before the start of 2022, the prior 13 years had been nothing short of remarkable for investors. The broad-based S&P 500, which is typically viewed as the best indicator of health for both the U.S. economy and the stock market, surged 600% from its Great Recession low. That's a compounded rate of return of 17.7% annually.

As the old saying goes, though, what goes up, must come down. Year to date, the broad market index has lost 16%, and all the signs are pointing to the economy sliding into an official recession early next year.

Although we recently endured two consecutive quarters of gross domestic product (GDP) contraction, the rule of thumb many use for a recession, the National Bureau of Economic Research says the definition is much less specific. It looks for "a significant decline in economic activity that is spread across the economy and lasts more than a few months."

We may be getting that soon. Perhaps the surest sign of a recession is on the way was Amazon and FedEx both announcing they were preparing to lay off tens of thousands of workers before Christmas. Still, there is no reason for you to panic.

The gathering storm

The Dallas branch of the Federal Reserve just released its latest regional report showing that its new orders index tumbled to a reading of negative 20.9 in November, making this the sixth straight month in negative territory and the lowest point since May 2020 during the depths of the pandemic. New order growth rates, capacity utilization, and shipments have all deteriorated for multiple months.

Manufacturers in the Fed survey had a mix of dour comments. One food manufacturer, for example, noted that while demand was still present, "there is just no cash to buy food." While a machinery manufacturer pointed to continued supply chain problems, a miscellaneous manufacturer said, "Our order backlog is growing because we cannot buy electronic components at any price."

One metal manufacturer declared, "Recession is coming! We are just waiting for the backlog to evaporate. Then layoffs start."

Indeed, JPMorgan Chase's Jamie Dimon said in October he expected the U.S. to fall into a recession within the next six to nine months because a "very, very serious" combination of problems would be buffeting businesses; inflation has risen to such a degree that the Federal Reserve is now overcorrecting to rein it in by drastically raising interest rates.

The silver lining amid the clouds

This is scary stuff, and investors do need to protect themselves, but not by burying their heads in the sand and hoping the storm blows over. Pulling all your money out of the stock market and stuffing it in a mattress is not a winning strategy.

As savvy investors know, market downturns are unique buying opportunities because former high-flying stocks are now available at far more reasonable valuations. But if a recession is coming, those high-flyers may still have further to fall.

Certainly, dollar-cost averaging is a worthwhile strategy to deploy, buying shares in good stocks with solid long-term potential that continue to fall. It means you acquire more shares when they're cheap and fewer when they're more expensive, all the while establishing a stake in a business that will rally when the storm passes.

Another option is to buy dividend stocks, which helps protect your portfolio as stock prices fall.     

Unparalleled opportunity

The asset managers at Hartford Financial Services looked at the performance of the S&P 500 going all the way back to 1930 and found that dividends contributed 40% to the total return of the index over that 91-year period.

They also found that from 1960 on, dividends represented an amazing 84% of the index's total return. Moreover, reinvesting dividends in the benchmark index, coupled with the power of compounding, would have turned a $10,000 investment into more than $4.9 million compared to just $795,823 that grubstake would have become based just on the index's price alone.      

Even more remarkable, there has not been a single decade in which dividend stocks in the index didn't generate positive returns, even when the broader market was losing money for investors. That includes the so-called "lost decade" of the 2000s when the S&P 500 produced negative returns, but dividend-paying stocks in the index produced 1.8% positive returns.

Fortify your portfolio now with dividend stocks

Market corrections, bear markets, and recessions can all be painful times. It behooves investors to remain calm during such periods of turmoil and look at how to make lemonade from the lemons they've been handed.                                    

As Warren Buffett has said, be fearful when others are greedy, and greedy when others are fearful. That doesn't mean buying stocks willy-nilly, but targeted investments like those that pay dividends will benefit you over the long haul. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, FedEx, and JPMorgan Chase. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The new inflation numbers that just dropped certainly have the markets worried about the depth of the recession we could be facing. With the S&P 500 index firmly in bear market territory, down 25% year-to-date, investors are rightly nervous about what it means for stocks.

Yet, history shows that bull markets always follow these corrections. And whereas bear markets are measured in months, bull markets are measured in years. That means sharp downturns are actually the best time to buy stocks for the long-term returns generated for your portfolio.  

As Warren Buffett once said, be fearful when others are greedy, and greedy when others are fearful. As long as investors have an appropriate investment horizon -- 10 years is usually good -- they should not fear bear markets, but look forward to them eagerly as a chance to buy good companies at discounted prices.

If you have $5,000 available, the following two growth stocks are excellent companies to own for years to come.

Apple

Apple (NASDAQ: AAPL) stock is down 22% in 2022 as investors worry about the economy's impact on consumer spending habits. It's estimated that App Store sales fell 5% in September, their biggest decline ever, and they are down 2% for the quarter. While that creates near-term headwinds, there is still strong demand for higher-priced iPhone 14 models, and a Piper Sandler survey of teens says Apple's share of the smartphone market remains near record highs.

One short-term catalyst is Apple's $90 million stock buyback program, which should help support any earnings weakness. And over the long haul Apple continues striving to  introduce new products, such as virtual reality headsets and the long-awaited Apple Car, which it would like to bring to market by 2025.

While some services like the App Store may see lower revenue in the coming quarters, others like iCloud, AppleCare, and even music ought to keep growing. Product sales are stable too, and because Apple has been able to keep its premium pricing intact as demand maintains its upward trajectory, the macroeconomic pressures on the company won't be as great as they will be on its lower-end rivals.

Investors might also take comfort in knowing that buying Apple stock at these prices means they will be buying the tech giant at prices cheaper than Warren Buffett got when he made the company 41% of Berkshire Hathaway's (NYSE: BRK.A)(NYSE: BRK.B) portfolio.

Costco

Another stock buffeted by consumer spending worries is Costco (NASDAQ: COST), whose stock is down 18% this year, and fell again last month despite reporting financial results that beat Wall Street expectations.

Inflation is taking its toll, with September's numbers coming in hotter than expected. Particularly in the pocketbook items that matter most to consumers -- food and fuel -- inflation is even higher than the headline print. Utility gas is up 33% over last year, eggs are 30% higher, gas prices are up 18%, chicken 17%, coffee and milk 15% higher, and so on.

Costco has chosen not to raise its membership fees at this time, much to the consternation of some, but that is actually helping drive shoppers to its warehouse clubs and helping to grow sales by double-digit rates. Comparable store sales growth dipped to 8.5% in September, the first time in 28 months they were below 10% (they were still up over 11% in the U.S.). It proves bulk buying of goods is a smart choice in this high-cost period, even if it doesn't fully insulate the retailer from the ravages of inflation. Gross margins, for example, were 10.5%, down from 11.1%, in fiscal 2021.

However, memberships remain a source of strength for Costco, and consumers are still flocking to the warehouse club. It ended its fiscal fourth quarter last month with 118.9 million cardholders, of which 53.1 million were household members, up 6.5% from last year.

While the economy can always get worse, Costco's results show the soundness and stability of its business model. It should carry the retailer through the tough times, which makes its stock a solid choice for an investor willing to buy and hold for the long haul. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and Costco Wholesale. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

One of the keys to Warren Buffett's phenomenal success over the years has been his willingness to buy stocks of good companies possessing long runways of future growth at discounted prices and then hold them for the long haul.

Using exactly that strategy, Buffett has generated aggregate gains of 3,641,613% since taking control of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) in 1965, for a 20.1% compound annual growth rate (CAGR). In comparison, the S&P 500 has generated 30,209% in total returns over that period, for a CAGR of 10.5%. In other words, there's a good reason Buffett is referred to as the Oracle of Omaha and people buy, sell, and hold the same stocks he does. 

Buffett was relatively late in buying tech stocks, but he's made up for that since. The following pair of companies represent some of his biggest tech holdings. They fit neatly within his strategy, and you can also buy and hold them for the long run.

Apple

Apple (NASDAQ: AAPL) is not only Buffett's biggest tech holding but his largest holding overall, representing a whopping 41% of Berkshire Hathaway's total portfolio. With almost 1 billion shares under his management, the investing oracle has accumulated $128.2 billion worth of Apple stock. With shares down 23% from recent highs and at some of the lowest prices in the past year, it's a stock you might want to consider acquiring for your own portfolio.

The weakness has to do with the new iPhone 14, which reportedly faces weakening demand. The company reportedly reversed plans to hike production because of it, but such bearishness is all relative. 

The iPhone, which was unveiled in September and starts at $1,000, is still selling quite well, beating out low-cost entry-level models elsewhere, and Apple is still planning to produce some 90 million iPhone 14s, which is in line with its original forecast for the device.

Apple still commands about half of the U.S. smartphone market, despite the iPhone getting long in the tooth after having been first introduced 15 years ago. And MacBook shipments are going against the grain, with market intelligence firm IDC reporting shipments surging 40.2% in the third quarter compared with a 15% decline in global PC shipments. 

Yet, as much as hardware remains a driving force for Apple, services are the real growth opportunity going forward. Services account for 20% of total sales, though the company is not immune to economic concerns. Analysts estimate App Store revenue dropped 5% in September due to a sharp decline in gaming revenue as inflation and recession fears take a toll on consumers. Growth may be a little slower now than it was, but margins are rising, and at 71.5%, well above Apple's 43.3% overall gross margins.

There will be ups and downs in any business, but Apple will be commanding a leadership position for years to come and would be a stock to consider now and in the future.

Verisign

Although Buffett first bought Verisign (NASDAQ: VRSN) nearly a decade ago, he has not accumulated nearly as much of its stock as he has of Apple's. He owns 12.8 million shares, worth some $2.3 billion. Not shabby, but it represents only 0.7% of the Berkshire portfolio, so its rise and fall won't have as great of an impact on performance. Still, it's one that investors ought to consider as well.

Verisign is the premier global provider of domain name registry services. It's the main company charged with doling out the .com, .edu, .gov, and .net domain names you find on the internet, while providing the routing support for them. Its behind-the-scenes operations basically point people to the correct website when they type in any site ending in those designations, helping to keep the world online and connected.

Verisign ended the second quarter with 351.5 million domain name registrations across all top-level domains, all of which pay a fee to it annually. It's been likened to the exclusive toll collector on the internet's "toll road," and it enjoys high-margin recurring revenue while having conversely low capital requirements, leading to very stable free cash flow generation.

There's no likelihood the internet is going anywhere, and its importance to business, even in the face of a potential recession, only continues to grow. Certainly, there was a massive uptick in the number of people starting their own businesses during the early months of the pandemic -- and registering their domain names -- that has since normalized, but that just underscores the long-term upward trajectory Verisign has at its back.

Buffett first bought Verisign in the fourth quarter of 2012, investing $143 million at an average of around $42 per share. With near monopoly-like status in its industry, careful stewardship of its business, and a cash-rich stream of revenue, the growth thesis behind Buffett's purchase of Verisign is still very much intact. With shares down 30% year to date, it may be the perfect time to buy your own stake, too.   

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and VeriSign. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

It's going to be Christmas in October for consumers after Amazon (NASDAQ: AMZN) announced it would be holding a second Prime Day event this year. Dubbed the Prime Early Access Sale, the e-commerce extravaganza will be held on Oct. 11 and Oct. 12.

The event is ostensibly intended to fire up consumers who are reeling from inflation ahead of the holidays -- and also blunt the impact of similar sales events being held by Target (NYSE: TGT) and Walmart (NYSE: WMT). However, there are reasons to be concerned that Amazon could dull the luster of its main summer sale by holding too many similar doorbuster sales. It could also mask the slowdown its e-commerce operations are experiencing.     

Getting a jump on Christmas

Amazon is extending early access to holiday savings to Prime program members in 15 countries (including, of course, new members signing up for 30-day free trials). 

The move comes as Walmart prepared to kick off its own Christmas sales push on Oct. 1 by cutting prices in key categories, extending its returns window to Jan. 31 for products purchased now, and also making it easier to initiate returns by either using curbside pickup or return pickups from homes for Walmart+ members. 

Target is similarly getting the season's greetings going early with a Deal Days promotion that will run from Oct. 6 through Oct. 8, discounting thousands of items. The retailer has also said it intends to hire 100,000 seasonal workers to handle the expected holiday sales surge. 

"Holiday creep" has been a problem for years, though. Because the Christmas season now can account for as much as 20% to 30% of a retailer's annual revenue, chains have steadily pushed the start dates for their holiday-focused promotions earlier and earlier. This year's moves just continue the trend.

Consumers are cutting back on shopping

Retailers' desires to get a jump on their most important sales period may also reflect their concerns about slowing revenue growth. Amazon's net sales growth slowed in the second quarter to just 7.2% year over year, bringing it to $121 billion. That was a slight deceleration from the 7.3% gain in the first quarter and also the slowest growth rate Amazon has recorded in more than two decades, even though the period included the summer Prime Day sale.

While we won't see Amazon's third-quarter results for a few weeks yet, it's clear that the new Prime Early Access event is intended to juice the company's fourth-quarter numbers. The competition is making similar efforts for similar reasons. 

Target suffered a 90% year-over-year decline in profits in the second quarter as it slashed prices on inventory that wasn't moving, while Walmart warned this summer that its full-year profits would plunge by 11% to 13% due to consumers cutting back on discretionary purchases. The retailer had previously expected a 1% profit decline.

The risk for Amazon, however, is it will dilute the effectiveness of Prime Day by having yet another sales festival. When consumers believe they won't have to wait long for another major sale, it reduces their sense of urgency about buying. Adding this October sales event may also undermine the significance of Cyber Monday/Cyber Week, another important sales period for online retailers.

A blue Christmas

Some may see adding a second Prime Day-themed sales event to the calendar as a genius move on Amazon's part, as it allows the e-tailer to remain competitive and appeal to consumers who are spending more cautiously due to inflation. But it's also a worrisome trend as it hides from investors the actual sales slowdown underway.

Bain & Co. forecasts that holiday spending will grow by 7.5% from last year, but when adjusted for inflation, the increase will really only be 1% to 3%. Pulling some sales forward into October won't really achieve anything for the retailer other than preventing later-acting rivals from stealing those sales away from it. While that could make it worthwhile, it could just end up being a wash because so many other chains are doing the same thing.

Amazon is still the place most consumers turn to first when shopping for goods online, but there might not be as much cheer this holiday season, no matter how early its Christmas sales begin. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Target, and Walmart Inc. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of Amazon (NASDAQ: AMZN) traded 1.85% lower on Wednesday after rival Walmart (NYSE: WMT) announced it had signed a partnership with Paramount Global (NASDAQ: PARA) to offer the movie studio's streaming service to its Walmart+ member loyalty program.

While the deal isn't about to prove particularly competitive to Amazon Prime Video since few sign up for Amazon's own membership program to simply get streaming video, Prime itself is coming under greater scrutiny. With Walmart+ priced some $50 less than Prime, it could be seen by some as a better value now.

So what

Walmart has tried offering movies to its customers before, once with a DVD rental service and once via its Vudu streaming offering. Both never gained traction and were subsequently sold off. This could be a better option for Walmart+ members since Paramount+ is operated by someone else and Walmart is simply providing access to it, albeit it being Paramount's ad-supported level.

Amazon Prime, though, is being investigated by the Federal Trade Commission over the ease of unsubscribing from the service. The probe has since expanded to include other Amazon subscription services including Audible, Amazon Music, Kindle Unlimited, and Subscribe & Save.

Amazon has an estimated 150 million U.S. subscribers in its Prime program, which costs $149 a year. Walmart+, on the other hand, boasts just 11 million U.S. customers.

Now what

The reason most people sign up for Prime is the fast, efficient delivery of goods from the e-commerce site. Walmart+ won't likely see any crush of people paying $98 a year because it now has streaming video.

Yet along with discounts on gasoline and a six-month free trial to Spotify, a free subscription to the Paramount+ Essential Plan, a $59 value, is a nice add-on benefit.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon and Walmart Inc. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon.com (NASDAQ: AMZN) just had a great quarter, and its stock is rising as a result. Although shares are still down 16% year to date, Wall Street expects the e-commerce giant to keep growing because its business model seems to show resilience even during recessionary times. 

Yet, as good as business was for Amazon, there are warning signs too that should give investors pause. Maybe now isn't the best time to buy its stock.

E-commerce slows as cloud services soar

Amazon's growth rate is slowing. While revenue of $121 billion was up 7.2% year over year, that was actually down sequentially and represents its slowest growth in 20 years. It also lost $2 billion in the period, with both domestic and international retail showing operating losses.

The core retail business continues to face a number of headwinds right now, including rampant inflation, energy costs that remain historically high, elevated transportation costs, and rising labor costs. 

While much of Amazon's net loss can be blamed on the continued downward spiral of electric truck maker Rivian Automotive Inc. (NASDAQ: RIVN) in which Amazon has a big investment and caused a $3.9 billion pre-tax valuation loss, those macroeconomic inputs are also impacting Amazon's margins. 

But what's keeping the e-commerce company's financial position looking better than it otherwise would is the cloud services business, Amazon Web Services (AWS), which showed solid, double-digit growth of 33% in the quarter. AWS revenue hit $19.7 billion, generating operating income of $5.7 billion, also up 36%.

Trimming the fat and then some

And that may be masking a deeper issue. Amazon shed almost 100,000 workers in the quarter, or about 6% of its workforce, and they are the largest cuts it has made in a single quarter. 

CFO Brian Olsavsky said they added employees in the first quarter due to the omicron variant of the coronavirus, but they essentially became redundant afterward. It was able to get rid of most of those let go through normal attrition, and Amazon still has over 188,000 more workers than it did last year. He also said Amazon would likely increase staffing levels for the holidays again.

Still, after years of operating as a job-creation machine, the growth trajectory has suddenly come to an end. The reduction also likely helped Amazon save on labor costs in the quarter, something it struggled with during the so-called Great Resignation when people left their jobs and never returned to the market.

In last year's fourth quarter, for example, Amazon took a $4 billion charge mostly because of labor costs, and though Olsavsky said last quarter the company needed to improve efficiency while it increased staffing, it instead reduced employment levels.

The reduction comes as many other tech companies are also slashing their payrolls, including Microsoft (NASDAQ:MSFT) and Shopify (NYSE: SHOP), while Alphabet (NASDAQ:GOOGL) and Meta Platforms Inc. (NASDAQ:META) have eased back on hiring. 

Clouds on the horizon

Amazon's payroll cuts likely helped improve its financial picture for the period, but it hints that the recessionary winds blowing may not be so transient. If we enter a protracted period of economic contraction, Amazon may see e-commerce growth slow as consumers find it difficult to keep spending.

Amazon.com is no longer necessarily the place to find the best price on goods, though admittedly that may not have been the prime attraction for its service in a while. Breadth of product and delivery speed has been a bigger value.

In a recession, though, that might not be the case, and despite its cloud services' increasingly essential to the overall businesses as time progresses, online retail may hamper performance. The underlying message of the job cuts just might mean this is not the time to buy Amazon stock.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Motley Fool contributor Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Meta Platforms, Inc., Microsoft, and Shopify. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, and Meta Platforms, Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This year is shaping up to be a leader in events that haven't been seen in decades -- not just inflation, gas prices, and interest rate hikes, but the stock market itself is off to its poorest start in 50 years. The S&P 500 is sitting 17% below where it started the year. And everyone thought 2020 was bad.

Yet as difficult as it's been for stocks generally, none is having a worse time than Netflix (NASDAQ: NFLX), which is the worst-performing stock in the broad market index, with shares down over 63% year to date. Shocking subscriber losses were the primary fuel that lit the fire to the streaming video stock's valuation. Maybe the destruction of shareholder value was justified, but has it gone too far?

Netflix is still the biggest streaming service globally and says next quarter it will recoup the 1 million subscribers it lost this time around. It's still a powerhouse in the industry, so should investors be looking at buying this beaten-down streaming giant, or does it still have further to fall?

Trimming the streaming fat

Netflix shocked the market earlier this year when it reported a loss of 200,000 subscribers, though it noted it was primarily due to exiting Russia following that country's invasion of Ukraine. That still meant its numbers would have been flat after promising it would add 2 million new subscribers -- not very encouraging.

That could be why Netflix braced investors for the second quarter, when it said it might lose anywhere from 2 million to 4 million subscribers. As it only lost 970,000 subscribers, it looks like a win, particularly after saying it will win back at least that many in net additions in the third quarter.

So what's changing that will improve its prospects?

Not worth the cost

Netflix maintains content is the reason viewers will come. Pointing to its hit series Ozark and Stranger Things, plus the original programming The Gray Man that just debuted, Netflix says it is committed to increasing entertainment value on the platform.

It's about time, because anyone who's watched Netflix in recent years knows that after movie studios yanked content to supply their own competing services, the Netflix menu was filled with vast oceans of dreck. It adopted a quantity-over-quality mindset to cover the fact that so much content had been removed from the platform, and it's likely what is hurting the service now.

That could be a difficult hurdle to get over. Variety reports that while Netflix is still the leading, must-have streamer, customers also rank it dead last in perceived value. Warner Bros Discovery's HBO Max and Disney's Disney+ are the No. 1 and No. 2 services in the value chain.

Strategies to turn viewership around

Netflix is also counting on the addition of an advertising-based subscription tier to further bolster its business. Though it long rebuffed the idea of adding ads to its service, the success of other streaming services like Hulu that have done this likely cemented Netflix's decision to do the same.

Its pricing is far higher than the competition's, which also undoubtedly hurts it in customer satisfaction scores, so the addition of ads will allow it to be more competitive on price among those who don't want to be paying $15 to $20 per month.

The risk, of course, is that Netflix ends up cannibalizing its primary streaming tiers. A Civic Science survey suggests that up to one-third of existing full-price subscribers would switch to a cheaper, ad-supported tier, potentially impacting revenue. Not to mention that there's a bit of concern after social media company Snap reported earnings that were hit by lower ad spending. Advertisers are starting to rein in their budgets, which represents poor timing for Netflix.

Wait for better quality

Yet, Netflix stock isn't cheap by traditional metrics. It trades at 21 times trailing earnings and 18 estimates, which may be discounted for the streamer but don't necessarily represent bargain-basement valuations for a stock that's lost two-thirds of its value.

At three times revenue and with earnings expected to grow 12% annually for the next five years, it seems the market may believe the streaming service stock is at best fairly valued, if not still on the high side. There may come a time when Netflix does bust out once more, but investors might want to wait to see if any of its initiatives actually hit their mark. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has positions in Warner Bros. Discovery, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Netflix and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Warner Bros. Discovery, Inc. and has recommended the following options: long January 2024 $145 calls on Walt Disney and short January 2024 $155 calls on Walt Disney. The Motley Fool Australia has recommended Netflix and Walt Disney. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

GameStop's (NYSE: GME) stock split announcement finally dropped. Investors have been waiting since March for the move after the video game retailer dramatically increased the number of shares outstanding from 300 million to one billion with the goal of splitting the stock.

The shares will split by a four-to-one ratio, meaning for every share you own, you get three more, but each one will be worth one-fourth the price they previously traded at. So, with GameStop recently closing around $135 per share, an investor with 10 shares will now own 40 stubs instead, but each will be worth only $33.75.

Unfortunately, the "mother of all short squeezes," or MOASS, that meme stock traders have been waiting for still will not happen. Just because GameStop's split will be in the form of a 'dividend' doesn't mean there will be any special impact on short-sellers. Yes, they'll have to buy back four times as many shares, but they'll be priced lower, just like investors who are long on the stock.

Gaming the system

GameStop, of course, is one of the premiere meme stocks on the market, often trading more on how much chatter is generated on social media and internet stock discussion boards than on the fundamentals of the business. In those circles, the self-described 'apes' have encouraged each other to hold firm and not sell their shares because a short squeeze, or fast and notable run-up, in GameStop's share price was imminent.

The video game retailer remains a heavily shorted stock -- over one-fifth of its shares are sold short. So, when GameStop said it would be splitting its stock as a dividend, that was seen as the catalyst to set the MOASS in motion. But that's not how it works.

A special kind of dividend

Most people are familiar with a cash dividend, where a company pays you a portion of its profits each month, quarter, or some other interval. As I explained once before, GameStop deeming its stock split a dividend is more a type of boilerplate language than some incantation with special powers.

Another heavily shorted stock, Tesla, has also said it will split its stock as a dividend, as do many companies. Alphabet's 20-for-1 stock split on July 15 will be in the form of a special dividend.

By declaring the split a dividend, a company is really only changing its accounting, essentially how much it keeps in its retained earnings account, and not much else. GameStop's stock dividend won't affect its cash balances as it would if it issued a cash dividend (which could cost short-sellers a lot of money), and the split won't trigger a new 'gamma squeeze' on its shares.

More important matters to address

While GameStop's stock typically doesn't trade on its fundamentals, that doesn't mean it never does. After announcing its stock split, the video game retailer also said it had fired its CFO and was laying off employees. After jumping 15% on the split announcement, the stock tumbled again in the aftermath of the firing and layoffs.

Meme stock traders like to claim the game is rigged against them and that the Securities and Exchange Commission is allowing illegal or improper activities. These traders are also basking in the camaraderie that develops in the chat rooms. Yet, they also tend to reinforce the notion that if they hold on just a little longer, they could wait out the monied interests better against their stock and realize significant riches when the MOASS occurs.

There may very well be a triggering event at some point, but GameStop's stock split isn't it.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), and Tesla. The Motley Fool Australia has recommended Alphabet (A shares) and Alphabet (C shares). The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

There's no question the $4 trillion energy sector has been home to the best-performing stocks on the market recently.

Over the past year, energy stocks have gained 72% on average while the next closest sector, utilities, rose less than 15%. In comparison, the broad market S&P 500 Index (SP: .INX) index lost 1%, and that started long before Russia invaded Ukraine.

It hasn't been much different in 2022 either, with the oil and gas stocks, in particular, leading the way. Energy is again on top with a 58% gain as utilities again ranked second with a less than 5% increase in value.

Yet over longer periods, the high cost of exploration and resource exploitation has made the energy sector a lagging sector for investors.

Technology stocks were the market darlings only until recently and over the past decade energy stocks ranked dead last with simple double-digit increases when virtually every other sector was sporting triple-digit gains. 

Oil and gas stocks are the stars these days, but is now the time to buy them?

Beating up on big oil

President Joe Biden recently said he hoped Americans could come out of the current energy crisis less dependent on fossil fuels. Alternative energy sources are already a rising component of the world's energy consumption, about 30% of the total, and that number is continuously growing.

Where the energy sector accounted for 29% of the stocks weighted in the S&P 500 in 1980, today they represent just 3.7%. Back then, seven of the top 10 stocks in the popular index were oil and gas stocks, led by ExxonMobil (NYSE: XOM); today there are none. 

And in a sign of how the world is further changing, Exxon was booted out of the Dow Jones Industrial Average in 2020 -- a spot it has held for nearly 100 years -- leaving only Chevron (NYSE: CVX) to represent the industry. Oil and gas stock investing isn't what it used to be.

Oil, oil everywhere

Yet that doesn't mean you shouldn't invest in the energy sector. It is simply too ingrained in the global economy to disappear.

For example, the U.S. Energy Information Association forecasts global "conventional" light-duty vehicles will nearly double from 1.31 billion in 2020 to 2.21 billion at their peak in 2038, but that will still far outstrip electric vehicle usage.

General Motors (NYSE: GM) has said it wants to produce only electric vehicles (EVs) by 2035 while Ford Motor Company (NYSE: F) is shooting for 40% of its fleet.

Tesla (NASDAQ: TSLA), in contrast, says it wants to sell 20 million EVs by 2027. However, the EIA predicts EV usage will grow from just 0.7% of the global LDV fleet to 31% in 2050, or just 672 million vehicles. Not an insignificant number, but still trailing gas-powered vehicles.

Petroleum products account for about 90% of all energy usage in the U.S. transportation sector, with gasoline accounting for 56% of the total.

Distillates, primarily diesel fuels, accounts for another 24%, and jet fuel, 9%. And jet fuel usage is growing rapidly with the EIA expecting consumption to increase at a faster rate than any other liquid transportation fuel through 2050.

And fossil fuels are in almost every product consumers use today, with petroleum appearing in everything from cosmetics and personal care products, to everyday items such as smartphones, computers, TVs, shoes, sporting goods, flooring, furniture, and medical supplies.

Grand View Research estimates the global petrochemicals market size was valued at $556.1 billion in 2021 will grow at a 6.2% compound annual rate through 2030, driven primarily by construction, pharmaceuticals, and automotive needs, as well as our industrial economy.

And though petroleum itself is not as important of a component for plastics manufacturing, natural gas and natural gas processing is. 

Still a gusher of an opportunity

The chances that alternative energy replaces fossil fuels for the foreseeable future are incredibly low. That's why I think the energy sector generally, and oil stocks in particular, are great buys, even today at their elevated levels.

Fossil fuels will be around for a long, long time meaning investors are to look very closely at some of the best energy stocks in the space as a long-term growth investment.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has positions in Chevron and ExxonMobil. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of Apple (NASDAQ: AAPL) were falling 3.9% heading into noontime trading Wednesday as retail sector earnings have been weaker than expected this week and the Federal Reserve is expected to further tighten the screws on the economy.

There has also been an uptick in cases of COVID-19, which caused Apple to delay implementation of its three-days-in-the-office policy.

So what

While the Dow Jones Industrial Average is tumbling almost 750 points lower, or 2.2%, the tech-laden Nasdaq 100 is down 3.3% so far. 

Even so, Bank of America thinks Apple is one of the companies that ought to perform well in the current inflationary environment. And analysts have noted its strong quarterly earnings report despite supply chain issues and the chip shortage that has weighed on industries of all kinds for at least a year now.

According to TheStreet.com, the bank's list includes stocks on the S&P 500 whose performance is inverse to its inflation indicator, for which its data goes as far back as 1975.

Now what

Apple employees have long complained about having to go back to work in the office. Ever since they've been able to work from home because of the pandemic, they believe they should be allowed to continue doing so.

Apple, though, was preparing to have them return to the office next week and work on site on Mondays, Tuesdays, and Thursdays. But with the rise in COVID cases, it has put the measure on hold for an undetermined period. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. Bank of America is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of Amazon.com (NASDAQ: AMZN) continued to fall on Monday as fears of a consumer retreat grew. The e-commerce giant's stock was down 3.2% at 12:03 p.m. ET, and was down 10% overall for the month to date.

The Federal Reserve hiked interest its benchmark interest rate by 0.5 percentage points last week, and it's expected to do so again following its next two monthly meetings in June and July as it attempts to tame inflation. 

So what

Rampant inflation is battering consumers, and when coupled with the prospects for economic decline, sales growth is likely going to slow further. But getting inflation under control won't be easy or pleasant and many pundits fear it could cause the economy to contract.

U.S. gross domestic product was already down 1.4% in the first quarter. The Federal Open Market Committee has said that it plans to boost the federal funds rate to around 1.9% by the end of 2022. But St. Louis Fed President James Bullard has said publicly that he thinks a steeper path of hikes to 3.5% by the end of the year will be needed to get inflation under control.

Now what

As the biggest e-commerce site in the U.S., accounting for 40% of all online sales, Amazon is always apt to feel some pain when consumers tighten their belts. Yet it is still growing: U.S. revenue was up 7.5% in the first quarter.

While retail obviously remains important to the company, Amazon's cloud computing operations are its biggest profit center. Earnings were up 57% in that segment last quarter. Look for that trend to continue as more businesses move more of their own operations online. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Even at the height of the craze supporting Shiba Inu (CRYPTO: SHIB), the most the cryptocurrency was ever worth was $0.00008 per token. As the time of writing, after the collapse of the crypto market, the dog-faced token is now worth $0.000027, or two-thirds less than what it was worth just four months ago.

It would take Shiba Inu a 37,000% hop to hit a penny. From there, it would be another 10,000% more to reach $1.  In other words, only a 3.7 million per cent increase gets you to $1.

Numbers like that might make your head spin, but perhaps buyers of the altcoin should really be asking themselves: "Can Shiba Inu make me wealthy with more reasonable expectations?" 

It looks like the boat already sailed

Early investors in Shiba Inu who held onto the token have already padded their accounts with millions of dollars. Had you invested just $5 on Jan. 1, 2021, at its peak 10 months later, you would have been sitting on a 60 million per cent gain and a value of over $3 million.

Had you held on until the end of the year, you would have seen that value plunge by well more than half, but would still have a nice nest egg of almost $1.3 million. The question for new people considering buying in is whether Shiba Inu has the chops to make even modest gains going forward.

Cryptocurrencies are volatile to be sure and investing in a token in the blind hope that lightning strikes twice is not the way to put your money to work, even if it is just half a sawbuck. 

Getting accepted into the club

What the biggest cryptos -- like Bitcoin, Ethereum, and Cardano -- have going for them is that they are seen as valid mediums of exchange with a store of value.

Tens of thousands of merchants now accept Bitcoin as payment. As the oldest and most widely distributed crypto, it has become almost mainstream. Yet for all of its ability to be used to buy goods and services, Bitcoin is also seen as an investment in its own right and is held for its potential future value. It is seen as inherently valuable by many despite its day-to-day volatility.

It's much the same with Ethereum and Cardano, though their acceptance is not nearly as widespread as Bitcoin's.

Broad acceptance hasn't been the case with Shiba Inu, though that's changing. In December, the Flexa payment platform added the token to its system, which is accepted by more than 40,000 merchants, including GameStop, Nordstrom, and Lowe's.

A few companies made a big deal about attracting Shiba Inu owners to their brand, like Regal Cinema owner Cineworld, which reportedly gave moviegoers a 20% discount on ticket prices if they purchased tickets with the token. AMC Entertainment asked its shareholders in a poll if it should add Shiba Inu and received a resounding yes in response. It plans to add the token (along with Dogecoin) as a purchase option sometime in the first quarter.

A lot of ifs

Meanwhile, there is something called the Shibarium in the works, a layer-2 blockchain project designed to run on top of Ethereum (Shiba Inu is an Ethereum-based token) that seeks to overcome two other problems Shiba Inu has faced: slow processing times and very high transaction fees.

If successful, that could lead to the development of non-fungible token (NFT) gaming and an entry into the metaverse. That could fuel even greater adoption for Shiba Inu, as could a listing on Robinhood Markets. But there are no guarantees any of this will come to fruition.

Moreover, it faces pressure not from more tokens being added to its already expansive base of 550 trillion tokens, but from new blockchain-based projects coming online. Without much to differentiate Shiba Inu, new alternatives that provide faster processing times or lower fees will assume a competitive advantage.

There is only the remotest of chances Shiba Inu will ever hit a penny in value, let alone a dollar. Reaching $1 would mean the cryptocurrency would be worth $550 trillion, or more than five times the gross domestic product (GDP) of all the world's economies combined.  

Shiba Inu would need the perfect alignment of the stars for it to attain a return to its former heights, let alone any real gain in value, which is why should steer clear of this cryptocurrency. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Bitcoin and Ethereum. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon (NASDAQ: AMZN) allegedly kept for itself over $61.7 million in tips earned by its Flex drivers and hid the practice from them for two years. It only changed how it paid the drivers when it became aware the Federal Trade Commission was investigating the company, according to an FTC administrative complaint.

Amazon agreed in February to settle the charges against it, and today the FTC announced it had approved a consent order against the e-commerce giant. Amazon will pay more than $61 million, which represents the total the company allegedly kept from its delivery drivers, and the FTC will reimburse the the workers. 

According to the complaint Amazon advertised its drivers could make $18 to $25 per hour, plus keep 100% of the tips they earned from customers.

But the FTC says, "Rather than passing along 100 percent of customers' tips to drivers, as it had promised to do, Amazon used the money itself."

Instead of paying the drivers the promised rate of pay plus tips, it paid the drivers a lower wage rate. Drivers began noticing their pay began to decline and despite receiving hundreds of complaints from drivers, Amazon issued form emails assuring them they were getting the full amount they were entitled to.

It only changed the pay policy in August 2019 when it received notice from the FTC it was investigating the allegations. 

In February, Amazon spokesperson Rena Lunak told CNBC, "While we disagree that the historical way we reported pay to drivers was unclear, we added additional clarity in 2019 and are pleased to put this matter behind us."

The consent order enjoins Amazon from violating the decree for 20 years making it subject to civil penalties of up to $43,792 per violation if they recur.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Shares of The Wendy's Company (NASDAQ: WEN) were rocketing 18% higher on Tuesday after the WallStreetBets subreddit crowd apparently turned its attention to the fast-food chain and mentioned it as a possible short squeeze candidate.

Chat room traders this year have driven up the shares of a number of companies that short-sellers have bet heavily against. While squeezes are not uncommon, retail investors have driven the discussion since January when they rallied together to support GameStop (NYSE: GME) and lash out at hedge funds that overplayed their hands.

Wendy's, though, is an unlikely stock to serve as a rallying point for Reddit investors, as there were just 8.2 million shares sold short at last count, down almost 18% from the prior period and amounting to just 4% of the shares outstanding.

With days to cover standing at around 2.5, it doesn't seem like a strong candidate to carry the banner next.

Wendy's stock is actually up 43% from the 52-week low it hit in March, and last month beat analyst expectations for first-quarter results, posting revenue of $460 million and generating adjusted profits of $0.20 per share.

That was notably better than the $444 million in revenue and $0.14 per share in earnings Wall Street anticipated.

While the meme stocks of the trading frenzy that started 2021 continue to capture the Reddit crowd's fancy, such as AMC Entertainment Holdings (NYSE: AMC), which has doubled in the past week alone, there have been a few other stocks that were curious choices, such as Tootsie Roll Industries (NYSE: TR), whose stock spiked over 100% in January and still trades 15% above where it started the year.

Wendy's has several tailwinds, including a returning workforce and a bullish outlook by management that raised full-year guidance.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon (NASDAQ: AMZN) announced today that it is launching a new prescription program for members of its Prime loyalty program, less than a day after Walmart (NYSE: WMT) said it was offering Walmart+ members a discounted prescription service as well.

Having acquired PillPack in 2018, Amazon has been looking to leverage its ability to buy prescription medicine in bulk and provide savings to members in a bid to take a large slice of the $360 billion prescription drug market.

Like the Walmart program, Amazon's new service is looking for patients who take just a small number of fairly common medicines, such as those used to treat high blood pressure and diabetes; they'll pay as little as $1 per month and receive a six-month supply.

Six months is typically longer than what insurance companies will pay for, so consumers could see real savings by enrolling in the healthcare prescription program. As Prime members, they'd also be entitled to receive free two-day delivery.

The new offer is an expansion of the Amazon Pharmacy benefit announced last month that allows Prime members to comparison shop for savings through its network of 60,000 pharmacies. It noted Prime members save 80% on generic medications and 40% on name-brand ones through Amazon Pharmacy.

Walmart just introduced Walmart+ RX, which also provides significant discounts on commonly used medications. It notes that members of Walmart+, a loyalty program the retailer launched to challenge Amazon Prime, can get some common medications free while saving up to 85% on others.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Elon Musk says the Tesla (NASDAQ: TSLA) Plaid is already so good there's not much he could do to improve it. In a tweet on Sunday, he said he's cancelled the top-of-the-line Plaid+ upgrade to the Model S.

The high-end basic Plaid is set to roll out on Thursday, June10. It carries a price tag starting just under $80,000 and offers a driving range of 390 miles, 1,020 horsepower, and 0 to 60 acceleration in 2 seconds. The Plaid+ was going to go for $150,000 after it hiked the price by $10,000, and it offered 520 miles of driving between charges.

Tesla, like other automakers, has been impacted by supply-chain disruptions caused by the global COVID-19 pandemic. Most recently, manufacturers have temporarily shut down production lines as semiconductor shortages weighed on their ability to meet demand.

Yet Tesla also faced the prospect of the Plaid+ going up against the company's Roadster supercar that's due in 2023. A related factor behind the cancellation was whether buyers would pay for two souped-up EVs. Musk solved that problem with two tweets on Sunday:

Plaid+ is canceled. No need, as Plaid is just so good.

— Elon Musk (@elonmusk) June 6, 2021

0 to 60mph in under 2 secs. Quickest production car ever made of any kind. Has to be felt to be believed.

— Elon Musk (@elonmusk) June 6, 2021

The change in the lineup follows a report Tesla sales plunged 45% in May to just 9,800 vehicles. The EV maker's stock was down 1% in midday trading.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Employees of Apple (NASDAQ: AAPL) are grousing about having to return to the office. 

In a letter to CEO Tim Cook, the employees say the new hybrid work policy that lets them work from home two days a week and up to two weeks a year with a manager's approval is overbearing because it doesn't take into consideration their feelings about working from an office again. They're demanding they be allowed to continue working from home if they want to.

Many companies are calling their employees back to the office as the economy reopens and more people become vaccinated against COVID-19. The Apple employees, however, aren't expressing concern about potential health and safety risks of returning; rather, they bemoan a lack of understanding about "the lived experiences of many of Apple's employees."

They say Cook's decision to end the remote work policy without first consulting them shows a disconnect between management and their workers' feelings. It also undermines the company's commitment to inclusivity and diversity, they say, because not every employee works well in the same conditions.

As a result, they have five "formal requests" for Apple:

• Allow teams to decide for themselves whether they will work from home.
• Regularly survey employees about certain listed issues.
• Ask during exit interviews about employee churn due to remote work.
• Implement an action plan to accommodate disabled employees whether they work from home, the office, or a combination.
• Study the environmental impact of employees returning to the office versus working from home.

The employees acknowledge the pandemic forced Apple to quickly adapt to new realities, but the record quarterly earnings report it just posted shows remote working is a success.

Working from home should be the "new normal" and the tech stock's employees ought to be allowed to continue doing so, their letter to Cook said.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

GameStop's (NYSE: GME) transformation into a digital video-game marketplace advanced to the next phase as the retailer today announced it was leasing a new 700,000-square-foot fulfillment center dedicated to its e-commerce ambitions.

The move seems to be a direct evolution of GameStop's appointment in March of Jenna Owens to be its executive vice president and chief operating officer. Prior to joining the video game retailer, Owens was a senior executive at Amazon, where her responsibilities included distribution and multichannel fulfillment.

Activist investor and interim chairman Ryan Cohen had previously made the audacious claim that he wanted to transform GameStop into the "Amazon of gaming."

Building out and modernizing the video game retailer's fulfillment network to improve the speed of delivery and service to customers was one of the six pillars of investment GameStop announced this year as part of it becoming "a customer-obsessed technology company to delight gamers."

The new fulfillment center will be in York, Pennsylvania, and is expected to be operational by the fourth quarter. The goal is to expand its product offerings and speed up delivery on the East Coast.

Another of its investment pillars is adding PC gaming, computers, monitors, game tables, mobile gaming, and gaming TVs to its product lineup. Now, the video game retailer will have the warehouse to store all those goods.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The next upgrade cycle for Apple (NASDAQ: AAPL) iPhones is going to be part of a "super replacement cycle," and an analyst is predicting the tech giant will be offering a foldable iPhone in 2023 to coincide with the trend.

MacRumors reported on Sunday that it has seen a research note to investors from TF International Securities analyst Ming-Chi Kuo, who says the feature-rich phone will offer an 8-inch QHD+ flexible OLED display. He forecasts Apple will ship 15 million to 20 million foldable iPhones in 2023.

In a rather upbeat and bullish note, Kuo said Apple is likely to be the biggest winner among manufacturers of foldable smartphones, which will become the obligatory tech that consumers need to have.

Currently, a foldable phone is designed to bring together the convenience and power of a smartphone and tablet computer, but further technological developments will add in the discrete capabilities of laptops, too.

Kuo wrote that Apple has a powerful, long-term edge over the competition. "With its cross-product ecosystems and hardware design advantages, Apple will be the biggest winner in the new foldable device trend," he said.

The analyst says development hasn't officially begun yet on the foldable iPhone, but he was making the prediction based on his latest industry survey.

Samsung has been a leader in foldable phones, releasing the Galaxy Fold in 2019. It has since been joined by LG and Motorola, though LG announced it was exiting the smartphone market.

Kuo believes all major smartphone manufacturers will need to have a foldable device, since it will be the center point of the next "super replacement cycle" for high-end models. But this is not the first time speculation has surfaced over Apple developing a foldable phone.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Apple and recommends the following options: short March 2023 $130 calls on Apple and long March 2023 $120 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool recommends the following options: long March 2023 $120.0 calls on Apple and short March 2023 $130.0 calls on Apple. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon (NASDAQ: AMZN) is set to overtake Walmart (NYSE: WMT) as the biggest U.S. retailer by 2025, according to a new report.

Yet just like Major League Baseball did to Roger Maris after he passed Babe Ruth's home run record in 1961, Amazon will need to tack an asterisk onto the achievement, because its growth isn't the milestone it initially appears.

In a report by Bloomberg, e-commerce data company Edge by Ascential says within four years consumers will purchase $632 billion worth of goods from Amazon, compared to $532 billion at Walmart. This is where the caveat is needed.

Amazon and Walmart have different business models. Where the e-commerce giant started off as an online retailer, today it operates more like a flea market charging rent to its 2 million or so third-party retailer tenants, who account for the vast majority of those sales.

In contrast, despite Walmart having a growing e-commerce presence and third-party platform, its sales are still mostly its own. When comparing apples to apples, then, Edge by Ascential admits Walmart will continue to be the retail behemoth it is today.

To account for the different business models, the data analytics company examined the gross merchandise volume of the two companies, a metric that measures how much consumers spend, regardless of where the product originates. In that way, Amazon is a juggernaut whose growth Walmart will be unable to impede by investing in its own digital sales platform.

Even though Walmart's online sales grew 79% last year, it's clear Amazon remains a continuing threat, which is why last year it launched its own Prime-like member loyalty program, Walmart+.

When Amazon is declared the biggest U.S. retailer in a few years, look at the fine print.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Rich Duprey has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.