Motley Fool Stock Advisor
$99 / first year
Strengths
- Two new stock picks each month
- Starter Stocks and Best Buys Now lists the best open recommendations
- In-depth research reports
- Performance tracking tools let you build a watchlist
Weaknesses
- There might be too many recommendations
- Focuses on growth stocks, so not a good fit for all investors
- Not every stock pick makes money
- $79 annual fee is only for the first year - after that it's $199 per year
Investing in stocks of high-quality companies can be an effective way to boost your investment performance. Buying shares of your favorite companies or today’s top market movers may have impressive short-term results but can be a risky long-term strategy.
Instead, you should be selective and choose companies that are well-run and have long-term growth potential. Motley Fool Stock Advisor makes it easier for you to find winning stocks. You get two new recommendations each month of stocks to “buy and hold.”
This Motley Fool Stock Advisor review helps you decide you can become a better investor.
Table of Contents
🔃 Updated February 2024 with the latest discount promotion, 60% off your first year. We also have added a list of alternatives to Motley Fool’s services.
Want stock picks that outperform the market?
The Motley Fool Stock Advisor has 3X’ed the S&P 500 over the last 20 years, outperforming the market 3-to-1 with 173 stock recommendations with 100% returns.
With 750,000 members, Stock Advisor is now 60% off – just $99 per year or $1.90 a week.
Try it for free for 30 days and if you’re not happy with your returns, you get a full refund.
👉 Learn more about Motley Fool Stock Advisor
(Offer expires March 31, 2024)
What is Motley Fool Stock Advisor?
Motley Fool was co-founded by brothers David and Tom Gardner in 1993. One of their beliefs is “investing in great businesses, for the long-term”. Long-time investors are quite familiar with Motley Fool investment research and that can outperform the average stock market return.
Today, Motley Fool publishes free investing news articles, podcasts, and several premium newsletters that recommend specific stocks to buy – including Stock Advisor.
Stock Advisor invests in highly liquid and well-known stocks from many industries. You get two new monthly recommendations with an in-depth analysis of why you should invest and the potential risks. Not all newsletters or reports give you the same amount of research.
In addition to two monthly picks, Stock Advisor keeps a running list of the best open recommendations to buy now. If you still need to buy your first stock, there’s a Starter Stock list of ten stocks with low volatility and high potential performance you might choose first.
Since launching in February 2002, the Motley Fool Stock Advisor newsletter has a total portfolio return of 493% versus 101% for the S&P 500 (through August 10, 2020).
Some of Motley Fool Stock Advisor’s successful picks include:
- Amazon
- Shopify
- Zoom Video Communications
- PayPal
- Costco
Stock Advisor first recommended Amazon, PayPal, and Costco in 2002 and has held them since.
Like any newsletter, not every Stock Advisor pick is successful. Some companies don’t live up to expectations and others commit fraud – like Luckin Coffee.
As Stock Advisor publishes new picks twice monthly. No need to buy everything that’s recommended, you can be patient and buy positions that are a good fit for your investment strategy.
Stock Advisor is also reasonably priced at $99 for the first year (then $199/year) – similar to other “entry-level newsletters.”
*Billed annually. Introductory price for the first year for new members only. First year bills at $99 and renews at $199.
Let’s take an in-depth look at everything Stock Advisor offers.
Two Monthly Stock Picks
Stock Advisor members get two new stock picks each month while most stock newsletters only have one monthly recommendation.
One monthly pick models the conservative investment style for Tom and the other follows David’s more aggressive approach. Each pick is usually for a growth stock. If you are a dividend investor you may find that the picks are somewhat lacking for your investment style.
If it’s still a good buy, Motley Fool may re-recommend a previous business. Sometimes, buying more of what you already own is the best option.
Each monthly pick gives you a detailed analysis covering these topics:
- What it does: Brief overview of crucial stock facts and business details
- Why buy now: The main reasons why this stock is worth buying today
- Potential risks: Reasons why you may avoid this stock or when you might sell
It only takes a few minutes to read the pros and cons of each stock pick. You should still perform your due diligence to decide if this pick fits your investment strategy.
Best Buys Now
As some of Stock Advisor’s earliest picks are still active, it can be hard to decide what to invest in. Motley Fool updates the “Best Buys Now” list each week. This list is the ten best recommendations to consider buying now.
The two newest monthly picks are usually on this list, yet some are several years old.
Starter Stocks
Each year, Stock Advisor publishes a “Starter Stocks” list containing ten stocks. This list is for new investors who still need to purchase their first stock.
Most of these stocks are well-known and you might use their services daily. They can be less volatile than the monthly stock picks but have plenty of long-term growth potential.
The Stock Advisor team recommends buying at least three starter stocks. Your other buys can come from the “Best Buys Now” or new monthly recommendations.
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Motley Fool Investing Strategy
How Motley Fool invests might be the most essential part of this Motley Fool Stock Advisor review. Swing traders and those investing in risky “micro-caps” should avoid this product.
Stock Advisor follows a “buy and hold strategy” with a minimum investment period of three to five years – unless the investment thesis changes. Owning a stock through dips and surges for multiple years is one way that Stock Advisor outperforms the S&P 500 long-term.
Most newsletters recommend stop losses to sell your position if it drops 25%, for instance. Stop losses help you manage your downside risk but encourage focusing on short-term results.
Not panic selling can be tough and sometimes Stock Advisor holds onto stocks for too long. Stock Advisor isn’t perfect but its 18-year performance is better than most active investors.
Here are some of the Motley Fool investing rules to invest in stocks successfully:
- Buy 15 or more Motley Fool recommendations
- Plan on holding your stocks for at least three years
- Invest new cash regularly
- Prepare for stock market declines – and buy more quality stocks
- Focus on long-term returns
The Fool also advises that no position exceeds 5% of your total portfolio value to minimize downside risk. Picking stocks gets a bad name when you don’t keep a balanced portfolio.
Long-term investors who appreciate the “buy and hold” philosophy are a good fit for Motley Fool Stock Advisor. Swing traders and those who use stop losses may not appreciate the Fool’s infrequent sell recommendations.
Risk Rating
Stock Advisor assigns a “risk rating” between 1 and 25 for each stock recommendation. Picks with lower scores are less risky. Most Stock Advisor picks have a risk score between 8 and 15.
Some of the questions that Motley Fools asks include:
- Is the company profitable?
- Does the company have intense direct competition?
- Is the brand a household name?
The risk score helps you find stocks that fit your investing goals. You can also view the Fool’s previous recommendations and investing articles for that stock.
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What Else Does Stock Advisor Offer?
The two monthly stock picks and the various Starter Stock and Best Buy Now lists are the best reason to get Stock Advisor. Their recommendations shorten your research time as you can quickly build a stock watchlist.
However, they also offer other tools that can make it easier to research stock ideas or track your investments.
Video Interviews
Video Interviews is a new feature that is exclusive to Stock Advisor members. These videos may have the Motley Fool team give an in-depth look at the latest stock pick. Sometimes, a video can be an interview with a company CEO that Motley Fool recommends. No matter what, the video will give you more in-depth knowledge of the recommendations you are receiving.
Stock Screener
The stock screener tool lets you filter stock picks by company size, industry, and conviction rating. This is an easier way to look through open Stock Advisor recommendations.
However, the Best Buys Now list is a great place to start researching stocks. These top stocks have the potential performance in the Stock Advisor portfolio.
Performance Tracking
Similar to your online broker, you can build a stock watchlist in Stock Advisor. You can “favorite” stocks you want to buy or track. Stock Advisor lets you enter purchase details if you buy shares.
The watchlist tracks the stock’s performance from when it joins the list. This tool also compares its return to the S&P 500. Your entry price can differ from the Stock Advisor’s original recommendation price. Adding stocks you own to the list makes it easy to see whether or not you outperform the broad market.
Another advantage of tracking stocks is the Motley Fool sends you notices when they write content about that stock. One example is the “10% Promise” notice when a share price changes at least 10% in a market session.
Motley Fool also includes earnings call transcripts for stocks they recommend.
Special Reports
Periodically, Stock Advisor provides special reports exclusive to premium subscribers. These reports suggest potential investments for a specific theme including:
- Autonomous vehicles
- Artificial intelligence
- Digital payments
These reports can be worth reading if you want to invest in a certain sector.
Community
The Motley Fool Community is another section you might enjoy. This message board is like Reddit but only for Motley Fool subscribers, including Stock Advisor.
You will see discussion boards for various investing topics including how to start investing. Other board focus on active Stock Advisor recommendations. Some members also share their investment portfolios to help give you investing ideas.
Like the official Motley Fool Stock Advisor picks, use your personal diligence to research and investing advice you see in the community discussions.
How Much Does Stock Advisor Cost?
Motley Fool Stock Advisor is offering a special discount on the first year so it costs just $79 – there’s a 30-day free trial so you can see whether or not it’s a fit for you. This is the lowest price I’ve seen in a long time, it’s normally $199 for the first year.
*Billed annually. Introductory price for the first year for new members only. First year bills at $99 and renews at $199.
After your first year, your Stock Advisor membership renews at the normal rate. Currently, that’s $199 per year. But Motley Fool may send you a $50 discount if you renew early – check your email a month before your renewal date.
The annual fee is competitive with most entry-level newsletters. This subscription cost is low so you have more cash to invest in different Stock Advisor stock picks.
Sign up for the Motley Fool Stock Advisor
Alternatives to Motley Fool
The Motley Fool is, essentially, a tool that offers stock recommendations. There are a lot of alternatives to the Motley Fool because there are a lot of people recommending stocks and giving a deep dive analysis of their recommendations.
Morningstar
Morningstar is one of the most respected sources for investment information and is frequently quoted by the financial media. It is the closest competitor to The Motley Fool, thanks to its mix of free content and premium stock-picking services. Its star rating system for stocks and funds is widely recognized.
To get the most from Morningstar, including access to analyst reports and watch lists, you’ll need to sign up for the company’s premium plan, Morningstar Investor. It costs $34.95 per month but is heavily discounted if you pay for a full year upfront.
Here’s our full Morningstar Investor Review.
Seeking Alpha
Seeking Alpha is yet another service that is similar to both Morningstar and The Motley Fool – they offer a Premium and Pro plan that offers stock tips, tools, and rating. Seeking Alpha has a huge catalog of free content so you can often get a lot of analysis without even paying for their service. If you do get Premium or Pro, you get a lot more analysis as well as Editor’s Picks.
Here’s our full review of Seeking Alpha.
Is Motley Fool Stock Advisor Worth It?
Yes, Stock Advisor is an excellent option for many long-term investors. You get investing ideas for stocks from a variety of industries. Most stock picks are in the tech and biotech industries as these companies have the most growth potential.
Stock Advisor isn’t a good option for short-term traders who rely on technical data and only plan to hold positions for days or months instead of several years.
Investors who want to invest in Dividend Aristocrats may find Stock Advisor too aggressive. It’s better suited to those planning on buying some growth stocks without a dividend.
If you prefer the extensive diversification of active investing ETFs or mutual funds, Morningstar Premium is a better research tool. Here’s how Motley Fool Stock Advisor compares to Morningstar.
Pros
- Two new stock picks each month
- Starter Stocks and Best Buys Now lists the best open recommendations
- In-depth research reports
- Performance tracking tools let you build a watchlist
Cons
- There might be too many recommendations
- Not every stock pick makes money (which says more about the market than the picks)
- 60% off the annual fee is only for the first year
Summary
Motley Fool Stock Advisor is one of the best investment tools for buying individual stocks. The annual cost is low enough that you can afford to buy several positions per year in well-run companies. Don’t forget to continue investing in your index or target retirement funds to maintain a diversified and balanced portfolio.
Remember, there’s a 30 day trial so you can sign up to see all of this yourself.
