Motley Fool Stock Advisor Review (2024)

Motley Fool Stock Advisor is one of the most popular stock picking services available today. Launched in 2002 by brothers David and Tom Gardner, Stock Advisor aims to help everyday investors beat the market through stock picks backed by rigorous analysis.

But does Motley Fool Stock Advisor deliver on its promise of market-beating returns? In this in-depth review, we'll assess key factors like the stock picking performance, research methodology, tools/resources, costs, and more to determine if the service is worth it for investors in 2024.

What is Motley Fool Stock Advisor?

Motley Fool Stock Advisor is the flagship stock picking newsletter from The Motley Fool investment advisory company.

Some key things to know about the service:

• Provides 2 stock picks per month (26 per year) along with detailed analysis on why they were chosen.
• Focuses on picking growth stocks positioned to outperform the broader market over a 3-5+ year time horizon.
• Run by investing team analysts David Gardner and Tom Gardner who share stock ideas.
• Beyond stock picks, additional market commentary, video lessons, reports and tools are provided.
• $99 for the first year, renews at $199 per year thereafter.

Overall, Stock Advisor offers guidance for long-term investors seeking high quality stock ideas to build a portfolio. Now let's assess how well the service has performed.

Motley Fool Stock Advisor Performance

Arguably the most important factor in evaluating Stock Advisor is its ability to deliver market-beating returns over time.

Here is the historical performance data according to The Motley Fool:

• Since 2002 inception: Average return of 552% vs. 139% for the S&P 500
• Past 10 years: Average return of 292% vs. 186% for the S&P 500
• Past 5 years: Average return of 79% vs. 59% for the S&P 500

This data shows that Motley Fool Stock Advisor's stock picks have significantly outperformed the broader market over both short and long-term periods.

According to Motley Fool, their Stock Advisor recommendations have beaten the market 77% of the time on average. However, individual returns can vary widely based on what stocks you buy and when you buy them.

While past performance is no guarantee of future results, the long track record does suggest Stock Advisor's methodology for picking stocks works very well.

How Does Motley Fool Pick Stocks?

So what is Motley Fool's secret sauce for identifying market-beating stocks? Here is an inside look at their stock picking methodology:

Qualitative Analysis

Motley Fool uses traditional fundamental analysis to deeply research stocks. This involves evaluating:

• Competitive advantages and economic moats
• Management teams
• Industry trends and market conditions
• Growth opportunities and total addressable market size
• Profitability, cash flows, debt profile

They favor innovative companies with durable competitive advantages, proven management, and long runways for expansion.

Long-Term Vision

Stock Advisor aims to identify "Rule Breaker" stocks that can beat the market through a 3-5+ year investment horizon. The goal is to buy great companies and let the investment thesis play out over time.

Insights From Two Experts

Stock Advisor subscribers get stock ideas from both David and Tom Gardner. Each brother has their own distinct stock picking approach to provide diversity.

Focus on Growth Stocks

The Gardners heavily favor growth stocks with upside potential over boring value stocks. This growth tilt explains much of Stock Advisor's market-beating performance.

Overall, Motley Fool combines rigorous fundamental analysis with a long-term mindset to identify high-quality growth stocks for its members.

Stock Advisor Tools and Resources

In addition to the stock picks, what other resources do members get? Here is an overview:

Monthly Stock Recommendation Newsletters

The core of Stock Advisor is the monthly newsletters with the two stock picks and analysis from David/Tom.

Weekly Podcasts

Popular Motley Fool investing podcasts like Motley Fool Money provide additional insight.

Video Lessons

The Gardners provide video lessons explaining their investing approach in detail.

Company Reports

Get in-depth research reports on Motley Fool stock recommendations and other stocks of interest.

Discussion Boards

Engage with the Motley Fool community and Stock Advisor analysts to discuss ideas.

Starter Guides/Checklists

Free articles explain in detail how to research stocks, evaluate management, read earnings reports, and more.

The additional stock research tools and educational content provide great supplemental value beyond the core stock picks.

Motley Fool Stock Advisor Cost

Here is the pricing for Motley Fool Stock Advisor:

• $99 for the first year
• Renews at $199 per year
• Cancel anytime

Considering most similar stock advisory newsletters cost between $200-$500 per year, the pricing is very reasonable and affordable for most investors.

While not cheap, for roughly $3.85 per week, the stock picks and recommendations can very quickly pay for the cost many times over if they lead to winning investment.

Pros and Cons

Here is a quick rundown of the main pros and cons of Motley Fool Stock Advisor:

Pros

• Tenured service with 20+ year track record
• Outstanding performance beating the market
• In-depth qualitative analysis and logic behind picks
• Growth-focused methodology identifies big winners
• Educational resources to learn investment strategy
• Affordable subscription pricing

Cons

• No exposure to options, bonds, or mutual funds
• mostly US-based stocks recommended
• Requires patience as picks can take years to pan out
• Individual returns vary significantly based on timing
• Cancelling subscription is a hassle

Overall, the pros far outweigh the cons, making Stock Advisor a compelling option for stock investors - especially those focused on US growth stocks.

Motley Fool Stock Advisor Returns Reddit

I analyzed recent Reddit threads to gauge feedback from actual Motley Fool Stock Advisor members on the performance:

• Most Reddit users highlight Stock Advisor's impressive long-term returns compared to the S&P 500. The growth stock focus leads to big winners.
• However, some members note performance is inconsistent year-to-year. 2020 was a huge year but 2021 was mediocre.
• Many mention great picks like Tesla, Netflix, Amazon, Nvidia, but also duds like Teladoc. Winners greatly outnumber losers over time.
• Most say returns beat the market comfortably, but you need to buy many of the picks, hold long-term, and properly allocate.

Overall, the Reddit feedback matches the reported return data. Stock Advisor clearly beats the market substantially over the long run, but individual stock and timing risks remain.

Motley Fool Stock Advisor Review Summary

Here is a quick rundown of the key takeaways from this hands-on Motley Fool Stock Advisor review:

• Transparent track record of market-beating returns - The published return data decisively beats the S&P 500 over both short and long periods.
• Strong stock picking methodology - Approach combining qualitative insights and a long-term growth investing mindset clearly works very well.
• Value beyond stock picks - The additional tools, resources, courses, and community provide tremendous value.
• Outstanding for US growth stocks - Stock Advisor focuses on exactly this niche, so excellent fit for this goal.
• Patience is key - Like any investments, Stock Advisor's picks work best over 3-5+ year time horizons.

Overall, the Motley Fool Stock Advisor service clearly provides significant value to investors looking to beat the market, especially those focused on domestic growth stocks. The affordable pricing, insightful research, and wealth of resources stack up very attractively.

Stock Advisor is best suited to patient investors who align with Motley Fool's long-term growth stock-focused philosophy. But disciplined execution is still required to earn market-beating returns over time.

Is Motley Fool Stock Advisor Worth It?

So does Motley Fool Stock Advisor successfully deliver enough value to justify the subscription cost?

In my view, the answer is a clear yes - Stock Advisor is absolutely worth it, providing you match the core philosophy.

Very few services can match the long track record of market-beating performance. The Gardners have clearly developed a successful formula for stock picking.

While not every stock will be a home run, the overall returns speak for themselves. And the member commentary is overwhelmingly positive from those who stick to the methodology.

But if you require income stocks, short-term trading ideas, or significant international exposure, Stock Advisor may not suit your needs as well. Understanding your own investing goals and preferences is key.

For an affordable $99 per year, Stock Advisor provides access to expert stock picks, detailed analysis, investing frameworks and so much more to give you an edge. While paying external advisors is no silver bullet, it can really help shortcut the learning curve and boost returns through proven stock selection.

If you're looking specifically for growth stocks, I believe the service offers high value and can quickly pay for itself many times over if the ideas lead to winning investments. But use discipline, match your risk tolerance, and invest for the long-run to maximize your probability of success.

Is Motley Fool Legit?

Yes, The Motley Fool is a completely legitimate and registered investment advisory firm. They have provided stock market analysis and advisory services to millions of customers for over 25 years.

They are fully transparent in communicating Stock Advisor's historical performance and limitations of their service. While no stock picking service is perfect or guarantees future returns, Motley Fool has delivered outstanding results over many years with a methodical and rational approach.

Motley Fool Stock Advisor Complaints

Given Motley Fool's long-running popularity, there are some customer complaints which are important to highlight:

• Difficulty cancelling subscriptions and continued billing
• Pump and dump accusations from short-term traders
• Inconsistency in returns year-over-year
• Not all picks are winners

However, these types of complaints seem common to most stock picking services. And Motley Fool has an "A" rating with the Better Business Bureau despite some negative reviews.

The key is having reasonable expectations - no service is perfect or able to avoid both winners and losers. But for long-term investors, the body of evidence strongly supports Motley Fool Stock Advisor's value. Focusing on their philosophy and decade+ time horizon is key to success.

Motley Fool Stock Advisor vs. Zacks

Zacks is another popular stock analysis service firms should consider.

Some key differences versus Motley Fool Stock Advisor:

Zacks

• Focused on quantitative models and data for stock analysis
• Targets short-term trading opportunities
• Broad coverage across all stocks and industries
• More tools for screening and tracking stocks

Motley Fool

• Fundamental analysis and qualitative focus
• Long-term "buy and hold" approach
• Narrower focus on growth stocks
• Educational investor content and community

Zacks is better suited to quantitative investors and short-term traders while Motley Fool appeals more to long-term investors focused specifically on growth.

Motley Fool Stock Advisor vs. Morningstar

Morningstar is another alternative to weigh. How does it compare?

Morningstar

• Emphasis on deep data and quantitative models
• Values finding undervalued stocks
• Broad coverage across stocks, funds, ETFs
• Advanced portfolio analysis tools

Motley Fool

• Qualitative approach and growth focus
• Long-term investing outlook
• Concentrated picks in growth stocks
• Investing education and guidance

Morningstar excels at data-driven analysis while Motley Fool focuses more on narrative-driven investing guidance. Different investors will have personal preferences between the two styles.

Is Motley Fool Worth It For Beginners?

Due to the long-term investing outlook and educational resources, Motley Fool Stock Advisor can be a good fit for investors just starting out.

Some benefits especially useful for beginners:

• Requires low minimum investment amounts to get started.
• Step-by-step guides on how to research and evaluate stocks.
• Motley Fool podcasts and videos deliver insights in engaging ways.
• Clear logic provided behind each stock pick recommendation.
• Starter stocks can provide low-risk exposure to test approach.

While investing always requires plenty of learning, Stock Advisor provides a supportive environment for newcomers to gradually build knowledge. Just focus on following their long-term, buy-and-hold methodology.

Motley Fool Stock Advisor Discount

The standard Stock Advisor pricing is $99 for the first year and $199 on renewal. However, Motley Fool often offers discounts:

• Special promo pricing of $49 or $69 for the first year is common
• Black Friday/Cyber Monday sales with up to 60% off not unusual
• Multi-year discounts like $299 for 3 years may be offered
• Cross-sell bundling deals with other Motley Fool services

If you encounter a Stock Advisor promo deal, take advantage of the trial discount. But the full price is still reasonable for the value provided.

Is Motley Fool Stock Advisor Worth It?

Motley Fool Stock Advisor clearly adds significant value for investors comfortable with its core long-term growth stock philosophy. The affordable pricing, market-beating returns, and valuable educational resources make it a highly attractive package.

While paying for any investment service is no guarantee of future success, Stock Advisor puts the odds of success strongly in your favor. Just apply patience and discipline when acting on the recommendations.

Ultimately there is no substitute for developing your own skills as an investor. But leveraging Motley Fool's expertise and track record provides a great head start to potentially boost your stock market returns.