When it comes to the stock market, making the best stock picks isn’t a walk in the park for even advanced investors. Investment research should be a part of every investor’s process before buying stocks. But, doing research on your own can be time-consuming and confusing, that’s where investment and stock research platforms can make a big difference.
There are many stock and investment research platforms out there that can help everyone from seasoned investors to novices. Two of the top names in the game, though, are Motley Fool and Zacks Investment Research.
The question is, which one should you choose? Let’s compare Motley Fool vs. Zacks so you can see which service has the right tools and features you’re looking for!
Motley Fool vs. Zacks: Overview
Motley Fool offers a variety of stock picking services, with their most well being Stock Advisor. The brothers’ Tom and David Gardner started the company in 1993. They started with sending newsletters to subscribers with investment information that was digestible for even casual investors.
Today, Motley Fool offers stock recommendations primarily through their flagship Stock Advisor service. The stock picking service makes two Motley Fool stock picks a month for their subscribers.
Zacks Investment Research
Founded in 1978 by Lens Zacks, Zacks Premium offers investors independent research to help give their users a trading advantage. Zacks focuses on using quantitative analysis that’s conducted by its industry experts.
Their analysts track everything from earnings per share forecasts, earnings estimate revisions, and every brokerage and analysts ratings. Zacks in-depth analysis allows them to create detailed research reports to show which stocks have higher and more consistent ratings as strong buys, as well as if its EPS has increased year over year to outperform the market.
Motley Fool vs. Zacks: How Do They Work?
Motley Fool has several different services and newsletters that revolve around investment themes. Stock Advisor is its most popular stock pick service.
Essentially, its services (including Stock Advisor) include the following:
- Stock recommendations every two weeks. Motley Fool provides in-depth research reports for each of its stock picks.
- Recommendations on individual stocks to sell
- Access to their “Best Buys” list of the best stocks to invest in today
- List of starter stocks for new investors to begin their investment portfolio
Motley Fool’s stock-picking strategy is for long-term investors who can commit to holding stocks for at least 3 to 5 years.
Motley Fool Stock Advisor Pricing
To sign up for Motley Fool Stock Advisor, it will cost you $199 per year for its stock picks. Occasionally, they run specials on pricing, and right now, you can a discount on your first year of Motley Fool Stock Advisor with this link.
There is also a 30 day trial period that you can try out Stock Advisor. That allows you to try out Motley Fool Stock Advisor risk-free if you want to see how you like the service before making your final decision.
Motley Fool Stock Picks
There are a number of different premium Motley Fool services available. Here is a summary of some of the notable ones below:
Its Rule Breakers newsletter features “hidden gem” growth stocks that are hand-picked by David Gardner. The stocks that are recommended tend to be up and coming companies, rather than the established institution.
Its also designed for buy and hold investors. You will also have access to the Best Buys list, Starter Stocks, sell signals, and other services found with Stock Advisor.
You get a look at Tom Gardner’s portfolio of publically traded stocks with this service. There is also buy and sell advice that’s given on a quarterly basis.
Everlasting Portfolio is intended for investors who have a minimum of $100,00 to invest in the stock market. Investors must also be willing to update their investments a few times a year.
Rule Your Retirement
Targeted at current retirees and those who are planning to retire soon, the service looks to maximize your retirement and money management. Robert Brokamp, lead advisor of Rule Your Retirement and a Certified Financial Planner runs the service.
Actional advice and insight on a variety of topics are discussed like portfolio asset allocation, choosing the right retirement account type, etc.
Zacks Investment Research
Zacks Premium is a premium service that provides users with access to its powerful investment research and tools that include its Zacks rating on over 10,000 stocks.
Zacks Premium Tools & Resouces include the following:
- Zacks #1 Rank List – This list includes the top 5% of stocks that have the most potential. Zacks Rank list has categories like “Value to Growth” and “Moment and Income”.
- Industry Rank List – Over 250 industry groups are included
- Earnings ESP (Expected Surprise Prediction) Filter – This stock analysis provides you with individual stocks that have the highest probability of experiencing surprise profitable earning
- Premium Screens – You get access to the list of the best stocks. Categories include value, momentum, income, and growth stocks.
- Research Reports – Over 1,000 of the most widely followed stocks are covered with independent research that leverages Zacks stock analysis capabilities to provide users a view of its growth prospects and fundamentals.
- Focus list – Follows the 50 long-term stock picks that Sherax Miam, Zacks’ Director of Research has selected. The stock investing recommendation is based on earnings momentum. \
- Zacks Confidential – A selection of hand-selected stock picks and nights from experts at Zacks Investment Research
Zacks Premium Pricing
Zacks Premium is a bit more expensive than Motley Fool Stock Advisor. You can get the service for $249 per year. However, you can also try out its service for 30 days to see whether the program works for you.
Motley Fool vs. Zacks: Competitors
There are several other competitors out there that offer similar services to Stock Advisor and Zacks. Morningstar Premium is one such competitor. It offers ranking like Zacks on stocks, mutual funds, and ETFs.
It uses its own system of ranking that’s based on its propriety research and commentary.
Another notable competitor is Kiplingers. It also offers several newsletters that cover subs like retirement planning, personal finance, and income generation.
Seeking Alpha’s free version provides stock news, analysis, and a research platform that consists of articles, blogs, and more. Seeking Alpha Premium adds access to its premium content, quant rating, dividend grades, and more.
Motley Fool vs. Zacks: Similarities
Motley Fool Stock Advisor and Zacks Premium have many similarities that are important to note when comparing the two. Let’s look at some of the things that make their services similar below.
Both Motley Fool Stock Advisor and Zacks Premium have similar investment strategies when it comes to stock picks. They both advise their subscribers to have a long-term view of their stock investments.
That also means that they both target the same customers: long-term investors who are willing to hold stocks for several years.
Zacks does also target advise those who are seeking short-term gains as well.
Free Content to Help Those New to the Stock Market
If you’re looking for help on learning how to invest, investment ideas, or investment advice, both Motley Fool, and Zacks Premium have plenty of content and tutorials that are available for free.
You can’t go wrong with browsing Zacks Investment Research or Motley Fool’s investment websites to find useful information.
Impressive Track Record
The performance of stock picks (or in Zacks Rank list), has consistently been able to beat out the performance of the S&P 500. Therefore both are good resources for investors seeking investment advice to identify potential stocks to add to their portfolio.
Motley Fool vs. Zacks: Differences
Motley Fool Stock Advisor and Zacks Premium have some glaring differences that also make them very different from one another.
When you look at the investing style of Zacks Premium, it’s very similar to other platforms overall. Its # Rank List is different, however.
Zacks Premium does not provide details on the technical factors it uses to provide its stock rank list. The service does appear to focus more on P/E ratios and other industry trends to make its investment advice on what stock picks make its list.
Analysts that work on its #1 Rank List also tend to lean more towards learning surprises.
Stock Advisor has a more transparent view of how it makes its stock picks. The Stock Advisor team provides a report that details each of its stock picks that explain why they believe it’s a good buy.
Depth of Resources
Motley Fool’s Stock Advisor includes two stock picks each month. You also receive a research report that goes over why Stock Advisor members should consider adding each stock to their investment accounts.
You don’t get any stock reports or general market commentary included in its premium subscription, however.
Zacks Premium has a deeper set of resources that are available. It has its Zacks Rank, and Focus List that’s part of its annual membership. Additionally, analysts from Zacks also rate major stocks on a 1-5 scale.
Its algorithm grades stocks using factors like value, momentum, or growth on a scale of A-F. Similar ratings can also be found for a mutual fund. Zacks grades over 19,000 mutual funds.
Finally, Zacks uses analysts from Wall Street to make its stock recommendations. Motley Fool and its stock-picking services are all recommendations from its own staff.
Zacks Rank List has been tracked since 1988 so that users can see what the performance of the service is to date. The annual return on the stocks found on this Zacks Premium product has averaged over 24 percent.
Zacks uses the following ranking system:
- Rank #1 – Strong Buying Recommendation
- Rank #2 – Buy Recommendation
- Rank #3 – Sell Recommendation
- Rank #4 – Strong Sell Recommendation.
If a stock is considered a “Strong Buy” that means that the stock’s earnings estimates are very likely to rise. When a stock is considering a “Strong Sell”, then the stock earnings estimates are likely to be declining.
Motley Fool Stock Advisor has been tracking its record since 2002. While this is a shorter time, Motley Fool Stock Advisor has managed to realize gains of around 16 percent on an annual basis.
Motley Fool Stock Advisor has a simpler format than the two competitors. Motley Fool sends each of its subscribers an email with two new stock picks each month.
This stock pick includes a detailed research report that explains why Motley Fool has selected it as a stock. Stock prices aren’t considered in these recommendations, however.
So you might end up having a recommendation that has a high stock price that you can’t afford to invest much into your portfolio.
Zacks Premium service is not as easy to pick up. They don’t provide reports like Motley Fool to help make buying decisions.
Zacks Rank List encompasses 20 stocks that are changed daily. The number of stock picks is high, but you must do further research to make decisions.
It is nice that Zacks Premium sends daily updates of new picks. That means your getting updated information based on market conditions.
This is among the most important portfolio management tools to keep yourself adjusted to the ever-changing economy.
Motley Fool vs. Zacks: Which is Better?
Let’s compare the two services head to head to identify where each stock picking service shines.
Motley Fool vs. Zacks: Beginner Investors
Getting into investing is an important personal finance milestone. It’s not an easy road for those who are beginning their journey.
There is a lot to learn for a beginner to become a certified stock trader. Motley Fool is best for these beginning investors to start building their portfolios with.
Motley Fool primarily recommends next-gen companies that fit its long-term strategy of holding stocks for 3 to 5 years.
Investors can get informed about stock recommendations by reading the detailed research reports that accompany the stock picks. All the ideas that are shared on Motley Fool are put into simple and plain terms so they are easily digestible.
Motley Fool vs. Zacks: Advanced Investors
More seasoned investors, particularly those who seek shorter investment periods than 3 to 5 years, will find value in Zacks. It uses fundamental analysis like Motley Fool but also identified stocks that have higher earnings estimates.
Using Zacks Premium, investors can build their own portfolio based on its recommendations. Plus, subscribers review other types of securities to incorporate as well.
Investors that are looking for a mutual fund or want to know what exchange-traded funds might be good investments can find that information with Zacks. There are also security analysis and portfolio analysis tools that subscribers can leverage.
Zacks Premium sends daily updates which enable investors to keep up on what’s going on in the market.
Motley Fool vs. Zacks: Customer Service
Zacks Premium wins in the customer service category. Its customer service is more investor-friendly when compared to Stock Advisor.
There is an 800 number that’s available Monday through Friday from 9 a.m. to 6 p.m. EST. The department heads are all listed with their email addresses and phone numbers.
An FAQ section and forum are available on Zacks’ website where subscribers can ask various questions.
For subscribers who want to learn more about portfolio management tools, there are tutorials available. Additionally, there’s a Zacks Method for Trading home study course that’s also available.
Motley Fool on the other hand is primarily DIY. The FAQ section and message boards are the primary methods of communication. You can also find a very active community section where subscribers discuss stock recommendations.
There are tutorials available on investment basics and they also provide live updates during market hours. Motley Fool’s 800 number is dedicated to questions about its services and subscriptions.
Bottom Line: Motley Fool vs. Zacks
Ultimately, the investment service that you choose comes down to what you are looking for it to provide. Motley Fool Stock Advisor is ideal for beginner investors who are starting to build their portfolios and want definitive recommendations on what stocks to pick.
Motley Fool Stock Advisor is the more straightforward service and they make it very easy to understand why they choose the stocks they do because of the detailed reports. You must also have a long-term mindset and be willing to buy and hold this stock picks for the next 3 to five years. If you’re still itching to learn more about Stock Advisor, you can read our full Motley Fool Stock Advisor review here.
When it comes to Zacks Premium, this service can also cater to short-term traders since its stock picks are updated daily. While you don’t get the detailed research reports that you do with Stock Advisor, you have access to their extensive research tools to find that information.
The seasoned investor who likes to stay on top of what’s happening in the market and is capable to conduct their own investment research will find Zacks Premium to be a valuable tool.