Ask the Fool The ‘Internet of Things’ What’s the “Internet of QThings”? — C.D., Odessa, Texas Fool’s School ­attention to value and instead seek My Dumbest Investment The Motley Fool Take You may have noticed that fast-growing companies. They are Anowadays, many “smart” more willing to buy seemingly over- The Merger Good Memory things are connected to the inter- How Do valued stocks, hoping that they will net, and they’re often controllable You Invest? keep rising in price. That Wasn’t Micron Technology (Nasdaq: MU) by apps on your phone. That’s • Large-cap investing: This style is one of the leading manufacturers For investors and would-be inves- I bought shares of Rite Aid just the Internet of Things (IoT). Your focuses on big companies, which have of DRAM (dynamic random access tors in the stock market, it’s important prior to the announcement that doorbell, for example, might be gotten big by executing strategies well memory) products used in consumer to understand that there are a variety it would merge with Walgreens. PCs and mobile devices, and its connected to your home Wi-Fi over time. They are more proven and of ways to go about investing. Here’s One day it was up by 35%, and products are increasingly being used network, allowing you to monitor include many blue-chip names. a look at some popular approaches. I just stared at it in wonder. I in cloud server, industrial and other and respond to it from anywhere. • Small-cap investing: Small com- didn’t sell and didn’t place a See which ones are best for you. enterprise markets. DRAM makes You may be able to turn lights on panies can be riskier, but they also can ­stop-loss order to protect • Dividend investing: Dividend up nearly three-quarters of Micron’s and off and adjust your thermo- usually grow faster than large ones. the gain. I watched it go total revenue. Micron is also a leading investors seek income from their stat via the internet, too, thanks They may be fairly new, and possibly way back down to below supplier of the NAND flash storage holdings, so they tend to look for to connected devices, and your not even profitable yet. the announced acquisition price. I devices used in solid-state drives stocks with generous dividend watch may also be transmitting • Mutual fund investing: Investors figured it would be easy money to (SSDs), which make up 24% of ­payouts and/or track records of buy and hold for a month or two fitness information wirelessly. who don’t want to study stocks and its business. regular and meaningful dividend until the acquisition closed, so I Even refrigerators and washing make buy and sell decisions on their Micron’s business is cyclical, increases. This is a powerful strat- added significantly to my position.­ and its prices rise and fall depend- machines are part of the IoT now. own can just park their dollars in egy, as dividends from healthy and Well, the acquisition ran into ing on supply and demand. During The IoT potentially encom- mutual funds, leaving fund managers ­growing companies are likely to ­trouble, the price was lowered, the company’s­ fiscal third-quarter passes just about any object that to do most of the work. Index funds and the merger didn’t happen. I increase over time and are paid in ­earnings call, CEO Sanjay Mehrotra can be connected to the internet in can be your best bet here, as they ended with a 70%-plus loss on good economies and bad. cited “strong demand across almost order to be controlled or to trans- have tended to outperform their more the largest single stock in my all end markets,” including PC, data • Value investing: Value investors mit information. actively managed counterparts over portfolio. Lessons learned: 1) center, smartphone and 5G. Meh- aim to buy stocks at prices below Don’t step in front of a steam- *** long periods. rotra said that Micron has so much their intrinsic value. Buying under- Note that you needn’t adopt only roller to pick up a dime. 2) If a ­automotive demand it can’t keep up, How can I tell if a company valued stocks builds in a margin of one of the investing styles above. stock jumps up 40% in one day, and also pointed to strong demand in Qpays a dividend? — G.N., safety and can reduce the odds of don’t think twice: Sell it, take the industrial markets. Many large-cap stocks have solid money and run. — C.D., online Bay City, Michigan being burned by a plunging stock. dividend yields, for example, while A semiconductor shortage is causing Great investors such as Warren The Fool Responds: It’s never demand to exceed supply right now, The best way is just to call the some fast-growing companies can and this could last into calendar year ­Buffett have focused on value also have undervalued stocks. It may worth risking death-by-steamroller Acompany, ask for the Investor for a dime. But do think twice 2022. But even when the supply short- Relations department, and inquire for decades. also be a good idea to diversify your • Growth investing: Growth inves- before selling a winning stock, age is eventually resolved, Mehrotra about dividend payments. It’s even portfolio with both large and small expects demand to increase further. tors, on the other hand, pay less as the best companies (and their easier to look up the company in companies. stocks) will keep growing over Micron has been a volatile stock online stock listings, which typi- time. The planned merger between in the past, but its stock has grown cally include any dividend and, if Name That Company Rite Aid (which was struggling) by more than 1,000% over the last one is paid, the current dividend and Walgreens Boots Alliance decade. Given frequent swings in yield — but note that these I trace my roots back to 1928, faced significant criticism, and memory pricing, this is one stock you sites may not have the most many expected the Federal Trade want to get right when you buy shares. when William Boeing and oth- With Micron’s forward-looking price- recent information. Commission to reject it. So the ers founded me as an “Aircraft deal was changed, with Walgreens to-earnings (P/E) ratio recently near 7, A company’s dividend yield is & Transport” company. I soon buying roughly half of Rite Aid’s this seems a promising time for long- more informative than its dividend started buying other carriers stores for $5.2 billion. term investors to buy. amount, as it allows you to com- — and in 2010 merged with Conti- pare different companies’ payouts LAST WEEK’S TRIVIA ANSWER in an apples-to-apples fashion. nental Airlines. In 2012, I was the The yield is the percentage of the first North American airline to fly I trace my roots back to 1909, when I began making and selling current stock price being paid out Boeing’s 787 Dreamliner. For a while, hair dyes to hairdressers. Today, based near Paris and with a mar- my parent company owned Westin ket value recently topping $260 billion, I’m the largest cosmetics annually in dividends. It’s calcu- company in the world (by revenue), with more than 85,000 employ- lated by dividing four quarters’ International, Hertz and Hilton Interna- ees and annual revenue of about $34 billion. My 35 brands include worth of dividend payments by tional. Today, based in Chicago and with CeraVe, Dark and Lovely, Diesel, Garnier, Giorgio Armani, Helena the current stock price. So a com- a recent market value topping $15 billion, Rubinstein, Lancome, Matrix, Maybelline New York, Prada, Ralph pany paying $0.50 quarterly ($2 I’m the third-largest airline in the U.S., with Lauren Fragrances, Redken, Urban Decay, Valentino, Yves Saint per year) and trading at $40 per the world’s most comprehensive global Laurent — and my own name, of course. My brand ambassadors share would have a yield of 5% route network. I serve more than 350 air- include Viola Davis and Celine Dion. Who am I? (Answer: L’Oreal) ($2 divided by $40). ports in 48 countries. Who am I? Want to Invest? Email us at [email protected], and we’ll Want more information about stocks? send you some tips to start investing. Sorry, we can’t provide Send us an email to [email protected]. Think you know the answer? We’ll announce it in next week’s edition. ­individual financial advice. © 2021 The Motley Fool/Dist. by Andrews McMeel Syndication 8/19