David Gardner Stock Picks
David Gardner is the co-founder of the Motley Fool, along with his brother Tom Gardner. The Gardner Brothers launched the platform’s flagship Stock Advisor stock picking newsletter and the Motley Fool’s Rule Breakers stock picking newsletter.
When the services initially launched, David Gardner would put out a few stock picks each month. In early 2021, David retired after teaching his methodology to his crack team of analysts. As of then, the stock picking services are run by The Motley Fool’s analyst team, who follows the investing methodology set forth by the Gardner brothers.
David Gardner has a strong record of explosive growth stock picks that have dramatically outperformed the broader stock market. The Stock Advisor portfolio, for example, is up 322% since 2002 compared to 116% for the S&P 500 (as of May 2022). The Rule Breakers portfolio is up 196% since 2004 compared to 103% for the S&P 500 (as of May 2022).
Let’s take a look back at some of David Gardner’s best stock picks over the years and see how they’ve performed.
Who is David Gardner?
David Gardner co-founded the Motley Fool in 1993 along with his brother Tom Gardner. The Motley Fool is an investment research platform with several stock picking and portfolio building newsletters. The Stock Advisor newsletter, was launched by David and Tom Gardner, started in 2002 and remains the Motley Fool’s flagship service, with more than 700,000 subscribers. The Rule Breakers newsletter, which was originally run by David Gardner and his team of analysts, launched in 2004 and is the platform’s second-most popular service.
David Gardner has co-written several investment books with his brother, including The Motley Fool Investment Guide, Rule Breakers, Rule Makers, and The Motley Fool Million Dollar Portfolio.
Gardner announced in 2021 that he would be stepping back from picking stocks for The Motley Fool as part of a quasi-retirement. However, his team of analysts continues to work for Stock Advisor and Rule Breakers.
David Gardner’s Investment Style
David Gardner’s investments have concentrated on stocks that are poised for explosive growth. His approach focused on companies that are creating new products or services that can upend an industry or create an entirely new field of business.
At the same time, Gardner’s approach paid close attention to the quality of management teams and operational efficiency. This methodology is rarely concerned with paying a high premium in terms of price-to-earnings for companies that the analysts believe are poised for massive growth.
These picks are meant to be long-term investments. Picks for Stock Advisor and Rule Breakers are meant to be held for at least five years. Several picks still in the Stock Advisor portfolio today were first opened in 2002.
David Gardner Stock Picks
David Gardner picked a number of highly successful companies early on, before much of the market realized how big they would become.
Let’s take a look at some of the best picks over the years (all performance data is as of May 2022).
- Date of original pick: 9/6/2002
- Re-recommended: 2010, 2018, 2021
David Gardner first picked Amazon for the Stock Advisor portfolio in 2002, three years before the company launched Amazon Prime. At the time, Amazon had a market cap of only $7 billion, and online commerce was still recovering from the bursting of the tech bubble.
Gardner also saw that Amazon wasn’t done growing. He re-recommended the stock in 2010, 2018, and most recently in 2021. In his most recent recommendation, Gardner pointed to the fact that ecommerce has more room to grow and cited Amazon’s continued expansion in cloud computing, logistics, healthcare, and groceries.
- Performance since 2002 pick: 14,410%
- Performance since 2010 pick: 1,151%
- Performance since 2018 pick: 25%
- Performance since 2021 pick: -31%
- Date of original pick: 4/15/2005
- Re-recommended: 2009, 2017
Gardner first picked Nvidia in 2005, just a few years after the company began making graphics processing units (GPUs). Gardner foresaw the importance of these chips in a world where video gaming was increasingly popular, although even he didn’t expect the role they would later play in applications like Bitcoin mining.
Gardner most recently re-recommended Nvidia in 2017 because of the company’s growth potential. At the time, Nvidia still made most of its money from gaming, but its chips were increasingly being used for vehicles and other consumer electronics.
- Performance since 2005 pick: 10,824%
- Performance since 2009 pick: 4,522%
- Performance since 2017 pick: 596%
- Date of original pick: 10/1/2004
- Re-recommended: 2006, 2007, 2013, 2019
Gardner first picked Netflix in 2004, only two years after the company’s IPO. Gardner saw the disruptive effect that Netflix was having on established video-rental companies like Blockbuster, and believed that there was plenty of room for growth in the US and internationally.
He re-recommended Netflix twice in 2006 and then again in 2007 after the company announced that it would move into streaming videos. Gardner also re-recommended Netflix in 2019, believing that the company’s moves into original programming would help accelerate its long-term growth.
- Performance since 2004 pick: 10,222%
- Performance since 2006 pick: 5,797%
- Performance since 2007 pick: 6,698%
- Performance since 2013 pick: 519%
- Performance since 2019 pick: -38%
- Date of original pick: 5/21/2004
- Re-recommended: 2010, 2012, 2014
Gardner first recommended Booking Holdings in 2004, when the company was Priceline. At the time, Priceline was disrupting the travel industry by enabling users to grab online discounts on hotels, flights, and more. Gardner saw Priceline’s rapid growth in the US and Booking.com’s growth in Europe, and jumped on the company.
He then doubled down on his position in 2010, 2012, and 2014, during periods when the stock was down due to reduced demand for travel. That especially paid off in the wake of the 2008 financial crisis, as his 2010 pick has returned more than 1,000%.
- Performance since 2004 pick: 9,270%
- Performance since 2010 pick: 1,051%
- Performance since 2012 pick: 277%
- Performance since 2014 pick: 75%
- Date of original pick: 6/7/2002
- Re-recommended: 2003, 2004, 2008
David Gardner recommended Disney for the Stock Advisor portfolio twice in 2002 and twice in 2003, then again in 2004 and 2008. It’s also one of Stock Advisor’s “Starter Stocks,” which are always recommended for new investors.
Gardner pointed to Disney’s proven and consistent ability to monetize its huge library of intellectual property at the time. It’s not just the company’s resorts or streaming services or blockbuster movies – it’s all of them put together, creating an ecosystem that people around the world are willing to spend money on year after year.
- Performance since 2002 pick: 5,745%
- Performance since 2003 pick: 1,021%
- Performance since 2004 pick: 1,352%
- Performance since 2008 pick: 594%
- Date of original pick: 8/9/2002
- Re-recommended: 2003, 2008, 2014
Activision Blizzard was another early pick in the Stock Advisor portfolio. Gardner correctly predicted not only the growth of video gaming – and especially online gaming – but also the ability of Activision Blizzard to consistently produce money-earning franchises.
Activision Blizzard remains in the Stock Advisor portfolio as a Starter Stock because of its continued high revenue growth. The Motley Fool analyst team is bullish on the company’s management and its ability to generate revenue from in-game transactions.
- Performance since 2002 pick: 2,428%
- Performance since 2003 pick: 4,824%
- Performance since 2004 pick: 408%
- Performance since 2008 pick: 307%
David Gardner Lifetime Performance
David Gardner has been one of the most successful stock pickers of the past two decades. His picks helped the Stock Advisor portfolio produce returns of 322% since 2002 compared to 116% for the S&P 500. Notably, including only David Gardner’s picks in the portfolio would have returned 626% through mid-2020. (Stock Advisor no longer displays individual performance for David and Tom Gardner.)
The Rule Breakers portfolio, which includes many of the same picks as the Stock Advisor portfolio, has returned 196% since 2004 compared to 103% for the S&P 500.
Conclusion: David Gardner’s Stock Picks
David Gardner was a highly successful investor for The Motley Fool, focused on picking explosive growth stocks before the market realizes their full potential. His picks have led the Stock Advisor portfolio to beat the broader market by nearly three-to-one since 2002. Gardner retired from the Motley Fool in 2021, but his team of analysts continues to make stock picks for the Stock Advisor and Rule Breakers newsletters, using the strategy this top Fool passed on to them.