Gardners See Plenty of Opportunities

While a number of recent financial scandals have led many investors to grow weary of the stock market, Motley Fool co-creators Tom and David Gardner say investors shouldn’t lose faith in stock investing. “I think that it is a great time to invest — I have always felt that way,” David tells Yahoo! Finance’s Daily Ticker. “While the backdrop of the system and a lot of skepticism is out there, probably it’s also a sign that there’s a lot of money outside the market, and when it comes back in, I feel really good about where my money’s positioned and the different companies that we own as investors.” Tom Gardner says that investors with a time horizon of less than a year should be nervous, but he and his brother aren’t among that group. He says one can’t evaluate a business and stock in less than six months; they have a 5- to 10-year horizon, he says, adding that investors need to look beyond quarterly earnings when evaluating a firm. They should look at the structure of the business, he says, adding that one key, overlooked metric that correlates with value creation is the rate of employee turnover — the longer employees want to stay at a firm, the more likely that firm is producing value. Right now, he says, there are “so many great businesses out there”.

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