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Motley Fool Hidden Gems Investing

The Art of Pricing Power

Motley Fool Hidden Gems Investing

The Motley Fool

Investing, Business

4.33.1K Ratings

🗓️ 20 January 2022

⏱️ 27 minutes

🧾️ Download transcript

Summary

Both Amazon and Costco are expected to increase their membership fees this year. Will they surprise customers (and investors) by increasing their fees by more than they have in the past? Maria Gallagher analyzes what’s expected and why pricing power is harder for entertainment businesses like Spotify, Netflix, and Disney+. She also discusses the expansion of McDonald’s partnership with Beyond Meat, the anticipated IPO of Impossible Foods, and why she’s not as bullish as others on the plant-based protein industry. Plus, Jason Moser and Matt Frankel dig into Shift4 Payments and share why it’s more than simply a payments processing business. To get a free copy of our Investing Starter Kit go to www.fool.com/StarterKit. Stocks: AMZN, COST, WMT, NFLX, DIS, SPOT, MCD, BYND, UL, FOUR, TOST, SQ Host: Chris Hill Guests: Maria Gallagher, Jason Moser, Matt Frankel Producer: Ricky Mulvey Engineers: Dan Boyd Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

Today on Motley Fool Money, we'll get into why we love pricing power and why we have questions

0:10.3

about the business of plant-based proteins.

0:13.2

All that and more coming up right now.

0:22.0

I'm Chris Hill, and joining me from the Financial Capital of the United States of America,

0:26.2

Motley Fool Senior Analyst, Maria Gallicor.

0:28.2

Thanks for being here.

0:29.2

Thanks for having me.

0:30.2

We've also got Jason Moser and Matt Frankl coming up with a closer look at a payments company.

0:35.6

A lot of investors don't know about, but let's start with a conversation about pricing power.

0:42.0

The thing that Warren Buffett has said, he loves to see most of all in a business the ability

0:47.6

to raise prices over time.

0:50.5

If history is any guide, Maria, both Amazon and Costco are going to raise the price of their

0:56.0

membership fees this year.

0:58.4

The last time Amazon did this with Amazon Prime was four years ago, and the time before

1:04.0

that was four years prior.

1:06.7

With Costco, it was on five-year cycles.

1:09.6

They raised the price of a Costco membership five years ago, and then five years before

1:14.2

that.

1:15.6

Let me start with this.

1:16.6

If you're a shareholder of either a company, first of all, congratulations.

1:22.0

These are great businesses that have rewarded shareholders for a long time, but if you're

1:25.2

a shareholder, you have to be hoping that they are going to follow suit and in fact, raise

...

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