Rule Breaker Investing Stock Stories, Vol. 11: Silicon, Supply Chains, and Spicy Wings

Join Motley Fool co-founder David Gardner and some Motley Fool analysts for this podcast.

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A full transcript is below.

This podcast was recorded on Oct. 15, 2025.

David Gardner: Some people love superhero stories. Enough to spend $1 billion at the box office in a single weekend. Others prefer tear jerkers. We all have a favorite bedtime story. Humans are a storytelling species, from prehistoric campfires to billion-dollar industries, celeb gossip, sports, the nightly news, all stories that shape how we see the world. Investing is stories too. Every stock has a mission, a tag line, a roller coaster arc. Look across your portfolio and you'll see tales of innovation, resilience, and wealth creation stories. Well, for the 11th time, we gather around the campfire this week for stock stories. Four Motley Fool guests join me with tales Anew freshly told to make you smarter, happier, and richer. Only on this week's Rule Breaker Investing.

Welcome back to Rule Breaker Investing. We tell a lot of stories on this podcast. Over the years, my God, I can't even imagine how many stories we have shared. But one thing's for sure, we have done stock stories as an episodic series for 11 times, counting this week. If you're a new listener, welcome there's a campfire. Oh, my gosh, listen to it. I'm going to be joined at the campfire by four special fools, each of whom will have a story to tell. Then I think they'll all leave me alone at the end, and I'll tell one last one as the lights go out. The campfire burns down, and I hope we leave the campfire site better than we found it, but you will be the judge, dear listener. I'm excited to get ready to welcome four Fools. Before we do that, I'll just mention next week's podcast. I have Robert Brokamp joining me for our annual Halloween tradition, and that would be financial horror stories. Robert, bringing back true stories from investing, business, and finance, true stories that are scary. We're going to have more stories. We may not even have a campfire. I may just be in the dark next week. Financial horror stories coming to you next week. But without further ado, let's get started. Let's settle in. A lot of us can get back in touch. I don't know if you like to burn your marshmallows or just leave them gooey, or not even put them over the fire. Just pop them in your mouth one at a time and chew them down. Well, all are welcome to this campfire, and I want to start by welcoming my friend Sanmeet Deo. Sanmeet, a delight to have you. Welcome to our Foolish Campfire.

Sanmeet Deo: Hey, David, thanks for having me on.

David Gardner: It's a delight to have you on it. It reminds me, Sanmeet. You joined me. It wasn't even eight months ago for our last episode. You told a story about crocks, and anybody who wants to hear Sanmeet and me talk about crocks, well, it's right there. Just Google Rule Breaker Investing Stock Stories Volume 10. Sanmeet, I really enjoyed that story. This time, well, before your story, could you just remind us in a sentence or two what you're doing around Fooldom these days?

Sanmeet Deo: Well, the biggest thing I'm doing nowadays is Supernova, which I know you're very well aware of. I'm super excited to be on the Supernova team on the Odyssey mission, and we're scouring the Rule Breaker universe for picks, and it's exciting. We're having a whole lot of fun.

David Gardner: I'm really delighted that we've relaunched Supernova, and I'm delighted, Sanmeet, that you're on that team. There are a few different portfolios in the new Supernova service at the Motley Fool. One of them we call the Odyssey portfolio, the Odyssey Mission, like Odysseus. We're on a long adventure. We're all playing the long game, and Sanmeet, you are there in the boat with us. Before we go to your story, I guess I'm just staring into the fire, trying to think, what's a good water cooler question? Here's what I'm going to go with. I'm flying later today, so I think I had this on my mind. Sanmeet, mobile boarding pass or printed just in case?

Sanmeet Deo: Well, I think I might age myself here, but I need a printed boarding pass. Even when I have a mobile, I need the printed one. [laughs] Something about the paper and having it, I feel like I'm actually on a trip, and it's needed.

David Gardner: I understand. I don't even know how to answer that question myself because I think I've gone both the different points, but you always feel a little bit anxious if you're just going with the electronic.

Sanmeet Deo: What if your cellphone dies? What if the Wi-Fi goes out? Who knows?

David Gardner: It's like tapping with credit cards these days. I'm always a little apprehensive, trying to figure out where I'm supposed to hit on the machine. But anyway, let's get to your stock story. Sanmeet, what stock are you going to be featuring this time around?

Sanmeet Deo: Yes. I am going to be talking about Wingstop, which is ticker WING, and I titled it from a basket of wings to $1 billion flywheel. Once upon a time, back in 1994, two guys in Garland, Texas, decided America needed better wings, not more wings, not cheaper wings, just better ones. They didn't invent the chicken wing, they reinvented it, and they made it the star of the menu instead of being an afterthought buried between burgers and fries. That's how Wingstop was born. One small store, big fryer, and a whole lot of ambition. You fast-forward to 2015, Wingstop goes public at $19 a share. Humble little IPO that would quietly hatch one of the greatest restaurant success stories of the past decade. Now you jump ahead to January 29th, 2021. Nothing in their history, but I actually bought the stock around 151 a share.

David Gardner: Was it during COVID that you bought the stock?

Sanmeet Deo: I think maybe it's because we were ordering a lot. It's like I'm sitting at home, ordering food, and they're very good with digital. I'll be talking about that as well. They have a fantastic app. I just love the focus. It was a franchise, or the flavors are very unique and bold, and it's a small, efficient, scalable business the one that Peter Lynch would have been waiting in line for a takeout. Not long after I bought it. Things got spicy. In 2022, chicken wing prices just went through the roof. Franchisees were probably scared. Stock plunged below $100. Analysts were like, game over, they sell wings, wings are expensive. How is this going to survive? Story gets good, though. Wing stopped in panic. They pivoted. They launched a pseudo-brand called thigh stop, essentially, where they're using the whole part of the chicken thighs and other parts that were more reasonable, where wings were going flapping upwards, I guess you could say. It was quick. They adapted. They were able to make it a success, switched around their supply chains a little bit, and did good. Stock soared to 425 that range in mid-2024. Since my purchase, I've watched it rise and fall throughout. Today it's around in the 250s range. I'm up about 68%, so not for a basket of wings. The real story, though, isn't the stock price. It's the business. When I bought it, systemwide sales were around 1.5 billion. Today, they are around three billion digital sales, which were very popular during COVID, were up about 40%. Now they're 65% of their revenues.

Store count 1,500-2,400, and they have a goal of 7,000. All this on a model is 98% franchise, capital high ROI every new store is a royalty machine. It's a flywheel effect where great flavors, people order digitally, franchisees make money, they attract more franchisees, system runs. The great thing about them is they're not trying to be McDonald's or Chipotle, they have one simple concept, one simple idea, very basic menu, wings and fries, sodas. That's about it. The lesson here, what is the lesson? Great businesses often look boring until they start breaking rules. They prove you don't need to invent something new or be this AI-driven company. You could just make one simple thing much better, more efficient, easy to get, and you'll be successful, and they're doing a great job and holding on tight to the stock. I think it has a lot of room for runway in the future.

David Gardner: It feels like the football time of year, people are ordering out a little bit more frequently. I don't know whether the fourth quarter calendar is always their best quarter, but it feels like probably a good one coming up. Market Cap saw me at about $7 billion today. I really like your point that it's such a simple approach and a simple concept, and you'd think there's no room for it. Chick-fil-A, Kentucky Fried Chicken, yet I think the world is often bigger than we suppose.

Sanmeet Deo: They're also in the chicken sandwich business, which if you've heard, there's a raging chicken war going on with beef prices up. Every restaurant is starting to make chicken sandwiches, very hot and heavy competition. They have it as an offering. It's not a big staple of their business, but it's a good complement to what they're providing.

David Gardner: Well, there you have it. From basket of wings to $1 billion flywheel. Sanmeet, could you remind us lesson in a line to close?

Sanmeet Deo: Great businesses often look boring until they start breaking rules.

David Gardner: Thank you very much, Sanmeet. You are welcome to hang around the fire. There might be music coming sometime soon, but you're also welcome to go back, and I don't know, go order chicken somewhere, and go about your life. Thank you for hanging out with us here on Stock Stories Volume 11.

Sanmeet Deo: Thank you.

David Gardner: Oh, my gosh, there's a second sound that's starting to creep into the night air, and speaking of, no, he's not a creep. He's a friend. Asit Sharma. That's not a good transition. Asit Sharma, a delight to welcome you back to Rule Breaker Investing.

Asit Sharma: Great to be here, David. I almost wanted to say, I'm a creeping friend, but that didn't sound so complimentary either.

David Gardner: [laughs] I want to note that you've brought a piece of equipment along with you.

Asit Sharma: Yes, I have my solar-powered warm glow camp light that we use when we camp every summer for this episode, and I feel so camp fiery at the moment.

David Gardner: This makes me wish we were more of a video pod. We could transition over to a video. We just have stuck with the old school audio, so no one else can see the warm orange glow. Bathing your face, Asit, what stock are we talking about?

Asit Sharma: David, we are talking about Advanced Micro Devices, ticker symbol AMD.

David Gardner: We're going to get there in a sec. But before we do Asit, what are you doing around Fooldom these days?

Asit Sharma: Well, I am working on Stock Advisor, as I have for a long time. I'm also exploring some new technologies. I love the semiconductor industry, and I will use the keyword here. I'm also interested in quantum computing. That's what I'm researching these.

David Gardner: It's exciting, and I look forward to learning from you because I'm now at a stage where I'm not picking stocks every week or month anymore. I'm waiting for people like Sanmeet and Asit to help me identify new things going on, and if there's not a lot of new technology coming. Asit, before we get started, I have to ask you, it's seasonal, my ice breaker question for you, pumpkin spice, pro or pass?

Asit Sharma: David, I hope this is an idiosyncratic answer. I hope I am the lone person among the masses to say this, and please don't send me letters. But pumpkin spice is so past in my world. Now, having said that, yes, do I love the ambiance of a warm beverage with some type of spice in it this time of year, the leaves turn color? I do, but for me, it's not pumpkin spice.

David Gardner: Well, that actually makes two of us around the campfire. Without further ado, let's go more toward Lisa Su, whose just named was at Forbes or Fortune CEO of the year. But I'm not trying to spoil or alert Asit's story. Asit, what is your title?

Asit Sharma: David, my story is the amazing Lisa Su turning AMD around in the deceptively simplest of ways. Once upon a time, there was a giant company in the semiconductor industry. It was one of the most valuable companies on Earth, and it held a market share of nearly 90%. But this isn't the story of Intel in the late 1990s and early 2000s. It's the story of a scrappy company named Advanced Micro Devices that challenged Intel, and then David fell so hard from Grace. Now, some back history here. Intel dominated the market for the PC based computer chips everyone used to use. Some people listening today will remember the Pentium processor, a name that was famous back in the day. AMD challenged Intel for dominance with cheaper chips, and this culminated in a breakthrough processor in 1999, which was called the Athlon. Now, this chip was not only less expensive than Intel's variant, it was also faster. Just before the dotcom crash, David AMD's shares hit $44 per share. Now, AMD was able to ride the success of their PC chips for several years. Like a lot of companies, they went with the flow, but along the way, they started to use their profits to extend their manufacturing capabilities or fabs. They placed overaggressive bets on lots of ill-timed extensions into lateral markets. By 2006, Big Bad Intel fought back with its most powerful chip yet. Just as AMD began to stagnate, it was spread too thin, and it was losing its innovation edge. Enter Lisa Su in the fall of 2014. AMD was unprofitable. They had a stretched balance sheet, and bankruptcy was on the table. Lisa Su was the company's chief operating officer, and the board took a risk on her. They appointed her CEO in October of 2014. Now, David, what about that stock? It was trading at $2.67 a share the day before Lisa Su took over the reins at AMD. That's a drop of approximately 95% from its all-time high, which was actually $48 a share.

David Gardner: That is a really tough way to spend about a dozen years as a shareholder for those who did, for those who may have bought at the top. Wow, I said, I'd forgotten $2 a share.

Asit Sharma: David, I wonder how many shareholders just took the sellout of sheer emotional exhaustion at that point. Now, Lisa Su holds a doctorate in electrical engineering from MIT. In fact, she holds bachelor's and her master's degree from MIT. She turned AMD around with a simple but masterful strategy. I'm going to just read you a few of these bullet points of what she did. The company pulled out of markets that weren't central to its business. It focused on its core strengths, which at the time and today were CPUs and GPUs.

Asit Sharma: She encouraged the company to return to what it loved. She told the engineers, look, go out there, create great competitive products. Then she went to key customers and told them, look, it's going to be three years before we can show you something that's truly transformative and new, but bet on us. So AMD introduced an award winning chip called the Ryzen and in 2017, it was solidly back in the black. Now, David, I want to pause here and ask you, does what she did sound vaguely familiar, the strategy?

David Gardner: It clearly should because that is a leading question, Asit. Yet, I'm trying to think what comparison you're making. This is a great example of a comeback story. It's an insider. As a female CEO, she's in a minority right there, and as a chief operating officer, appointed CEO, that usually doesn't happen either, but I think you're probably speaking more about just the idea of, but I'm not guessing. Tell me.

Asit Sharma: You're so close, and actually, it's a pattern. I hope I didn't lead you down trying to think of a company, but it's a pattern that we all have seen before. I think it's best expressed by Jim Collins in his wonderful book, Good to Great. She used the hedgehog strategy so simple. Basically, if you don't know about this hedgehog strategy, it goes like this. You focus on three areas that intersect, what your company can be the best in the world at, what drives your economic engine, and what you're deeply passionate about. Lisa Su did all three. Today, David, AMD shares trade at around $225 a share. The stock is on its way to being 100 bagger. For those who might have bought on the news that the Cerebral chief operating officer was going to take over AMD way back in the fall of 2014.

David Gardner: What a remarkable story, and thank you for breaking it down. At no point have I ever recommended or owned any shares of AMD, which for a while, made me feel pretty good about myself. Over the last decade or so, I don't feel as good about myself, although having bought and held Nvidia, we've all benefited. Though, the entire industry, Asit, as you know, is so relevant today and it's not just about those companies. Intel, even taking investment now from Nvidia reminds me of when Microsoft invested in Apple during a hard time for Apple. Anyway, ASML, there are so many interesting companies here, Asit, but maybe this is the most interesting CEO, because what an underdog?

Asit Sharma: I agree, and one that doesn't fit your mold of the typical executive who's going to take over a major semiconductor company. She happens to be cousins with Jensen Huang. I think many members listening already know that. But going back to your point about winners winning, Nvidia has been such a great company to own and AMD had its stumbles, but also I think they're on their way to winning. I would count out Intel either. There is a lot at stake here both geopolitically and just in order to improve our lives with artificial intelligence, and these companies play such a central role in that.

David Gardner: Wonderful, Asit Sharma. Well, thank you for the amazing Lisa Su turning a company around in the most surprising of ways. What is the lesson in a line takeaway you want to leave us and the Campfire with, Asit?

Asit Sharma: The takeaway line is, it's OK to be a hedgehog. You can win, even if you're down and out. It's OK to stick with what you know, what you love, what you can be the best in the world at.

David Gardner: Thank you for that. As we begin to transition, oh my gosh, our third guest is nearing the Campfire. But as we make a transition, I'm going to make an admission to Asit and everybody else. I've actually never read from Good to Great. I know it's one of the most praised business books out there. I know it's by Jim Collins who I have interviewed before. I've just never literally read Good to Great. I can't read them all, Asit. I know the hedgehog strategy is a framework, though. I probably could have gotten a better grade on your good question.

Asit Sharma: Well, to your point, David, there's so much to read out there. There's so many books and so little time. I will say there's a great cheat sheet. If you go look for summaries of the book, it can be distilled as many good business books can into a few principles. This is something that Morgan Housel had mentioned to me at one point in time. A lot of the business books that we have out there, they could be a lot shorter. [LAUGHTER].

Who is our third, oh, my gosh, our third visitor is David Meier. Dave, welcome to the Campfire.

David Meier: Thank you for having me.

David Gardner: What a delight it is, and I can hear some new sounds that you've brought with you, Dave, to the Stock Stories Campfire. This is Volume 11. You have appeared on our podcast before, Dave, but remind the folks, I'm not going to say at home because they're out in the forest. Remind the folks in the forest what you do around Fooldom.

David Meier: I am a Senior Analyst at The Motley Fool. I've just celebrated my 20th anniversary at The Fool. I'm so proud of that, and I'm now a co-captain of the Supernova Odyssey portfolio, which is incredibly exciting.

David Gardner: I'm so excited to have you there and Sanmeet, who visited with us earlier and still might be lurking out there somewhere amid the crickets. He is one of your teammates and we're of course excited about the Motley Fool Supernova launch. Dave, I'm excited to have you on the Odyssey mission.

David Meier: It's incredible and very, very happy to have Sanmeet on board as well.

David Gardner: Are you going to be talking about a Rule Breakery Stock, Dave, or what stock and ticker symbol do you have in mind this time?

David Meier: Oh, yes, it is a fan favorite, MercadoLibre. The ticker symbol is M-E-L-I.

David Gardner: Excellent. Before I ask you the title of your story, to get us started, Dave, my ice breaker question for you around the Campfire, I'm going to go with your approach to being active. Dave Meier, morning walk, evening run, or is the commute itself the workout? By the way, do you even have a commute anymore?

David Meier: I don't. It's tough to go downstairs, but it is not an evening run. It is an evening walk behind the push cart of my golf clubs, and it just about happens every day.

David Gardner: That is pretty fantastic. Well, love thinking of you somewhere in South Carolina playing golf on nearly a daily basis, and loving investing and business as you have now in your 20th year at the Motley Fool. Dave Meier, what is the title of your story?

David Meier: The title of my story is, You Haven't Missed a Thing. Once upon a time, when I was working on MDP, that is million dollar portfolio, a newsletter of ours from the past, we passed, we decided not to invest in Mercado Libre in 2010. If you know anything about that stock chart, it is way up into the right. Now, why would I do something like that? Well, actually the team had what we called a bull bear debate. The bulls got in a room and the bears got in the room, and we had a back and forth. The bears were so convincing that we decided now wasn't the time to make an investment in Mercado Libre.

David Gardner: Dave, did I just hear a bear in the forest?

David Meier: You did. In fact, there were a number of bears in the forest that day.

David Gardner: OMG. Please continue, I say, somewhat quakingly.

David Meier: That stuck with me for quite a while. I was like, man, this is a great company, and the stock price is going up and the business is growing. How could I missed this? Then I thought, let me start talking with some other Fools. I thought, wow, it's still a great business a few years later. But I've missed it. I haven't made the investment. So I can't invest now. I had such a better price back then. I had more growth opportunities back then. That thinking is just completely wrong because when you find a great business like this, one that has incredible potential, one that has great management teams, one that has the backing of a lot of good investment professionals. I don't know, one that has a lot of the six traits of a Rule Breaker, let's say, you actually have time to invest at any point in time. I really appreciate you, David Gardner, imparting that on me. That's one of the things that I have taken away from you as someone who was a value investor before, where I was like, I need to get this price or I'm not going to make the investment. It was more, hey, I need to find this great business, and I'll have multiple opportunities to invest in it. That is the thing that I didn't make that mistake twice. Even though I had lots of people saying, it's too expensive now or it's nowhere near, it doesn't have as much growth potential, that's all been wrong. What did it for me was changing my focus to really saying, what is this business doing now? What is it investing for in the future, and what other options might it have to grow that people aren't even thinking about?

David Gardner: I'm already sensing the didactic lesson we're learning here, Dave, and it is one of my favorite lessons and I really appreciate. I'm going to let you give that in a bit, but can you share with us then when you did hop aboard the Mercado Libre wagon?

David Meier: I actually hopped aboard it multiple times over the next about 10 years of my investing career at the Motley Fool. There were some in 2014, there were some in 2016, there were some in 2017. These were all at different price points. But again, the thing that we focused on most was, this was a business that was getting better, getting stronger. The thing that I don't think people fully appreciate, and I know I didn't at the time, was that this is essentially a platform of networks. There are networks upon networks that are just creating an advantage that no business can replicate what Mercado Libre is doing down in South America. Again, we've had so many opportunities to make investments that have earned outsize returns, market beating returns every year since it's been a publicly traded company. Again, that's not how I started my investing career. But the lesson is, hey, you may have think you've missed an opportunity, but if you find a truly great business, one that has all those six traits of a Rule Breaker, you haven't missed it. There will be multiple opportunities to make market beating returns on your investment.

David Gardner: Thank you, David Meier, and this is now the 11th volume in one of our favorite episodic series, Stock Stories. I think we could probably tell that every single time with different changing company names and ticker symbols because I guess I missed it. Five of the most harmful words, for potential Rule Breaker investor looking at Rule Breaker Stocks, I guess I missed it. So much money left on the table. Dave, such an opportunity cost. Usually without overselling this, but what do winners do, Dave Meier?

David Meier: Winners add to winners.

David Gardner: Yeah. Well said, winners win, and real winners, by the way, win, win, win. That gets into a conscious capitalism point for another Campfire. But I so appreciate that story, and Mercado Libre is an outstanding example of that. Your own progression as an investor, partly shaped by that is a beautiful thing to hear, even as dark as it is getting around this Campfire right now. Dave Meier, before I bid you ado, lesson in a line.

David Meier: If you think you've missed it, you haven't.

David Gardner: Boom. Thanks, Dave. Well, just reviewing briefly. Wingstop and then AMD, and then Mercado Libre, I wonder what Chief Investment Officer, Andy Cross is going to bring to this Campfire next. Now, the first thing Andy is bringing is, oh my gosh, there's a new sound. Andy Cross, welcome.

Andy Cross: Hi, David. Great veer here around the Campfire. I wish I brought some smores for us, but unfortunately, I got.

David Gardner: Earlier I said, and let me just ask you that now. Do you prefer your smores a little bit burnt, a little bit gooey, or just straight up barely cooked?

Andy Cross: David, I am a smores connoisseur. I'm very particular about how I cook my smore marshmallows, and I like them perfectly golden toasted.

David Gardner: Golden toasted. So if it goes a little past that, you just dump the whole thing, including the Hershey bar in the fire, am I right?

Andy Cross: I'll give it to my dad. He likes them all burned. [LAUGHTER]

David Gardner: Andy Cross, our Chief Investment Officer, what are you doing around Fooldom these days?

Andy Cross: Well, mostly it's continuing to research stocks and figure out how we can better use AI tooling for our investment guidance and our writing and research and hopefully to lead to better investing performance for members.

David Gardner: That's why we do what we do, and thank you, Andy for, how many years of the Fool now, 20?

Andy Cross: Oh, gosh, David, yes, 29.

David Gardner: Twenty-nine?

Andy Cross: Yeah. I think I've only been the Fool for, I don't know, 28. We're getting up there, Dave.

David Gardner: Well, welcome to the Campfire. What stock are you going to be bringing this time around?

Andy Cross: David, I'm bringing Manhattan Associates. The ticker symbol is M-A-N-H.

David Gardner: Thank you, Andy. Before I ask you the title of your story, I'm just wondering, I'm already feeling a little bit anxious about holiday shopping, and it's only mid October, but we have some family birthdays in the last few months. So I'm just curious, your overall approach to holiday shopping. Andy, it's December 23, at that point, are you done? Are you sprinting or are you just starting online?

Andy Cross: David, just to be honest, I am usually sprinting at that point. However, this year, I am determined because I'm already thinking about it. I am determined, come the 23rd December to be completely at peace with all my shopping.

David Gardner: You have made a commitment before this campfire, before thousands and thousands of people who've just heard you state that.

Andy Cross: Absolutely. I hope you have me back to verify. I can join the show to verify how I did on my commitment to December 23rd non shopping.

David Gardner: Andy, I will either have you back or I will have your back. We'll see which one I need to do. Manhattan Associates, Andy, what is the title of your story?

Andy Cross: David, I'm saying from boxes to bots, Manhattan Associates, the warehouse Wizard Wall Street Forgot. Once upon a time, in April 1998, a small software company called Manhattan Associates went public at $3.75 per share. The company makes warehouse and logistics management software about as exciting as watching paint dry in an air when everyone was chasing.com dreams, while investors poured billions into pets.com or Juniper Networks, Manhattan quietly helped companies figure out how to move boxes from shelf to truck to store and into shopping baskets. By early 2000 when the.com bubble burst, Manhattan was actually flying. Revenues hit 138 million that year and its stock peaked at November at more than $15 per share, a four bagger in just a couple of years.

David Gardner: Nice.

Andy Cross: But then the hangover came when the NASDAQ fell almost 80% by 2002. Manhattan did a little bit better, was down by half still, and it stayed in that range for the next few years, David. Meanwhile, under its new CEO Eddie Capel, the business was coming along. Revenues doubled over the next five years as Manhattan expanded its client base and developed integrated platforms for logistics. Importantly, it started to focus more on omni channel, both digital and physical solutions for its retailing clients. By 2012, the stock had returned back to those.com highs with sales approaching 400 million and operating profits of more than 100 million, very nicely profitable. Manhattan had a nice, highly profitable on premise, sticky business with high retention rates, consistent cash flows, and evergreen opportunities as clients look to scale out their back office logistics.

David Gardner: Andy, here we are 2012 or so stocks, I don't know. I'm looking at the chart, in fact, in present day terms, it's somewhere around $12 a share. It's cruised back. It's into double digits again, nearing the end of 2012, and where are we headed next?

Andy Cross: At that point, it's like everything investors like to see, including me. In our original Hidden Gem service, we recommended shares in 2013 at $18 and $22 as the company was driving this profitable growth strategy. Within a few years, a sock has soared to almost $80 per share, but there were some big strategic challenges that the company was facing and it was called the Cloud. Think back to 2015, David, Salesforce had been Cloud native for 16 years, as you know, Workday had been disrupting HR software for a decade. But Manhattan. Well, they were still installing software on servers and warehouses like it was 2005. It's very profitable. It was very sticky, but the market was changing and moving on and they were dangerously late to that Cloud party. Growth started to slow. Now the operating margins and return on capital were still very high, but investors were worried about this lack of a clear Cloud strategy. The stock really tells the story. From 2016 until 2019, as you may see, the broader market soared, but Manhattan stock went nowhere, stuck between that $35 and $55 range. In 2017, the company finally started to build out Manhattan Active. That's their Cloud platform. They offered Manhattan Active Solutions, the world's first Cloud Native Extensible Foundation for supply chain E-commerce. They launched Manhattan Warehouse Management folly for the Cloud in 2020, that they still use today. They were late, but they were catching up. The Growth started picking up in 2019 as its Cloud business accelerated, and by 2019, the stock had grown to almost $80 per share.

David Gardner: That is pretty sweet. Andy, you mentioned CEO Eddie Capel earlier. Is he still around? I don't know this company that well. I'm enjoying the story, though.

Andy Cross: He has now moved to the executive chair position. They brought in an outsider, as I'll talk about their third challenge that they're facing right now because this one in 2019, 2020, of course, COVID then smacks everybody. The stock crashes to less than $40 by 2020, so 80-40, but at this time, being in logistics turned out to be fortuitous for Manhattan and its shareholders. Suddenly, the world discovered supply chains. Remember that great toilet paper crisis of 2020? Well, every CEO suddenly realized that supply chain just wasn't a cost center it was actually mission critical. Guess who had spent five years building one of the most advanced Cloud based supply chain platforms, even though they were a little late, it was Manhattan. The stock went nuts. By 2021, it was near $180 per share and Manhattan Active became really a platform of choice for companies that were scrambling to digitize those operations nearly overnight. But now David in a world filled with AI innovation, Manhattan is facing its next great challenge. Growth has started to slow again a little bit because clients are doubting the need for the company's professional services when we can all turn to ChatGPT for answers.

Manhattan has again had to dive right into developing a new integrated technology across its entire platform, and that includes agentic AI. They have built Manhattan Assist, which has now handled hundreds of thousands of customer inquiries, and more importantly, they're launching intelligent agents, these AI BTS that can actually run warehouse operations and handle customer service queries. David, as I mentioned, after 24 years as CEO, Eddie Capel, he did step aside and brought in some fresh blood from the outside, which is what Manhattan needs and Eric Clark, he's a former CEO of NTT Data in North America, which is a huge tech firm, and he's going all into AI and Cloud first solutions to drive the growth forward. As for those original Hidden Gems recommendations from 2013, well, there are nine and 11 baggers being really attractive and very good S&P 500 pretty handily, even though the stock is off from its all time highs last year, earlier this year of $300, and I'm a shareholder myself.

David Gardner: Love it. Andy, I'm just thinking back to the COVID moments. This happens. I've often said in the past, stocks always go down faster than they go up, but they always go up, good ones anyway, more than they go down. Just to see this coming from the high 80s in near the start of 2020. Two months later cut in half, in two months. You sat through that with Hidden Gems recommendations in place, and indeed it has gone much higher. Market Cap Game Show fans, I think, if my numbers are right, market cap around $12 billion today for Manhattan Associates. If you have a 12 bagger or so, that means it was $1 billion market cap where this company started. Of course, it started well before that, as Andy pointed out. Andy Cross, Manhattan Associates, from boxes to bots, the Warehouse Wizard that Wall Street forgot about, it's understandable that Wall Street might. This is an example, Andy, of a boring company. Probably undercovered. Small to mid cap, now a mid cap, depending on how you score things. These are some of the more fun stocks that you and others have found for members over the years. We always love companies playing the long game. Andy, your didactic takeaway, your lesson in Align here.

Andy Cross: Well, clearly, David companies need to be evolving and invading and actually disrupting themselves and Manhattan Associates learned that lesson quite painfully and now they're into it again, but I think they can do it right. The best winners do that very well. They do it again and again and sometimes it takes some patience as a shareholder.

David Gardner: Well said Andy Cross. Just looking back over the chart of the stock, which I'm now looking at. It's been cut in half at least four times over the last 20 years. You had to sit there and take it. If you really wanted to watch the stock that as Andy mentioned, back in the year 2002, this stock is single digits, and today, of course, it's over $200 a share. Andy Cross, thank you for reminding us of what investing really looks like the wins and the loss, and the need for all of us to evolve and adapt to meet the needs of customers in an ever changing world. A delight to be with you. I'm going to suggest you might want to leave the campfire now because it's gotten even darker, and it's getting scarier.

Andy Cross: I don't like the scary. As Billy Beane said in the movie Moneyball, hey, innovate or die. I'm going to step away from the campfire before it gets even any darker or any scarier.

David Gardner: You innovate your way out of here. Thank you, Andy, for joining us this week, fool on.

Andy Cross: Thanks David.

David Gardner: Well, before I begin the final story, I want to thank again, my friend Sanmeet Deo, Asit Sharma, David Meier, and Andy Cross, and here comes the final story, story Number 5. Thanks for hanging out with me at the campfire because we're the last ones left. This story is ultimately about the etymology of a word. Etymology is of course, the origins, word origins. I think any longtime rule Breaker investing listener or rule Breaker investor might already know what I mean when I say the word spiffy-pop. But there's a stock attached to the phrase spiffy-pop. I want to briefly tell you again the tale of spiffy-pop and the stock that I'll always remember as a stock story that is connected to spiffy-pop. I'd seen it happen in other investors portfolios. I'd caused it to happen in my own portfolio a number of times. It's a beautiful thing. It's when you make more money in a single day, than you paid for that stock whenever you purchased it way back when. You make more money in a single day, than you paid for that stock when you bought it. It's a beautiful thing when that happens. Many people don't even know it can happen. For many people, they don't even realize that the stock market could be full of such riches. There are others often unwilling to be patient enough to actually let a spiffy-pop happen, but I'd seen it. I'd seen it happen in my grandfather's portfolio.

I'd seen it happen in my father's portfolio. I'd seen it happen in mine and I decided we needed to have a term for that, so that we could talk about it with the world at large. Eighteen years ago, it was May 2007. We launched a contest at Motley Fool Rule Breakers. I said it out loud to the world at large and to our membership, submit a term. What should this be called? Well, we got over 300 different terms nominated those couple of months. Some were crazy, funny, some were very good terms. It all came down to a few. I reserve for myself the final pick and I just decided that I love that phrase spiffy-pop. Spiffy hyphen pop. Why? Well, because people talk all the time about how this or that stock popped. It's very much a one day thing. Hey, do you think that stock might pop? But when a stock pops in this way, when let's say you paid $15.37 a share a few years ago for a stock that just today went up, let's say $16 a share.

Again, you paid $15.37. You just made more money in a single day than you paid for it. That's a very special pop and frost at the Motley Fool, that's a spiffy-pop, I'm happy to say that the day after we announced the official term to rule Breaker members on a Thursday. That very Friday in May of 2007, the very next day, a stock in the Rulebreakers service spiffy-popped. It was like magic. It was a quantive. Ticker symbol A-Q-N-T was bought out by Microsoft. Now, just to put some clothes on it, we had purchased shares of a quantive for Motley Fool Rule Breakers, and our members, we recommended the stock back on it was December 20, 2006. That day for members of Rule Breakers, it was at $25.14 a share at the close that day. We took down that as our cost basis. Twenty five dollars and fourteen cents it turns out just six months later, on May 18, 2007, a quantive went from $35.87-$63.79, it went up 78% in a single day. That was quite a pop. By any measure, thanks to Microsoft, generously paying a huge premium for a quantive, which was an advertising data company. But since we'd only paid $25 a share, for that stock to go up $27 a share in a single day, that was the first spiffy-pop.

There you are at the end of this week's podcast and as I kick, the embers and our campfire dies down just a little bit of Rule Breakers lure for you a day for those of us who are around Rulebreakers back in May of 2007, we'll always remember. It was the day after we just revealed our new term spiffy-pop, we had one. In our service, pick six months earlier, spiffy-pop. I guess my lesson in a line, let me see. Let's go with spiffy-pop. It's compoundings Victory Lap, one day's gain that pays back your entire cost basis and it's worth shooting for. Just as I say, at the start of my Rule Breaker Investing book, everyone is an investor. I believe everyone can make a 100 bagger and on your way to that 100 bagger, you will have any number of spiff-pops. Well, the fires down to Embers. It's time to kick the rest of the fire out, carry a spark into the week ahead and keep holding great stories and great companies. I hope we've left your campsite this week better than we found it. Until next time, good night, fools and fool on.

Asit Sharma has positions in Advanced Micro Devices, Intel, McDonald's, Microsoft, Nvidia, Salesforce, and Wingstop. David Gardner has positions in Apple and MercadoLibre. David Meier has no position in any of the stocks mentioned. Sanmeet Deo, CFA has positions in ASML, Chipotle Mexican Grill, and Wingstop. The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Apple, Chipotle Mexican Grill, Intel, Manhattan Associates, MercadoLibre, Microsoft, Nvidia, Salesforce, and Workday. The Motley Fool recommends Wingstop and recommends the following options: long January 2026 $395 calls on Microsoft, short December 2025 $45 calls on Chipotle Mexican Grill, short January 2026 $405 calls on Microsoft, and short November 2025 $21 puts on Intel. The Motley Fool has a disclosure policy.