Both companies are independent research firms that make money by selling subscriptions. Both put their money where their mouths are by running their own mutual funds, where you can watch some of their ideas perform.
If you’re just starting out investing, or don’t wish to invest much time into your portfolio, The Motley Fool is both simple and entertaining. The Motley Fool claims its Stock Advisor portfolio has earned a 588% return since 2002, compared to the S&P 500’s return of 120%, as of February 23, 2021.
Morningstar Premium, like Zacks, is more than a newsletter. It also ranks stocks, mutual funds, and ETFs within its own system, along with proprietary commentary and research. It is considered the gold standard of mutual fund rankings by many Wall Street brokerages. Here’s a comparison between The Motley Fool and Morningstar we’ve recently made.
Kiplinger’s has been around for decades and offers several newsletters focusing on income generation, retirement planning, and personal finance. Jim Cramer, the host of CNBC’s Mad Money, offers commentary, daily updates, investment advice, and a monthly members-only investment call through his Action Alerts Plus website and newsletter.
Zacks appeals to more advanced investors, especially those whose investment horizon is shorter than 3 to 5 years. In addition to Motley Fools’ type of fundamental analysis, Zacks zeroes in on stocks whose earnings estimates have been raised (or lowered).
Investors can assemble their own portfolios from Zacks recommendations and review other securities they may have against Zacks’ rankings.
Because the company offers both strong buy and strong sell recommendations, investors may use Zacks for long and short strategies.
Zacks also covers mutual funds, ETFs, and options, offering an extensive set of tools for both security analysis and portfolio analysis. Zacks subscribers receive daily updates about their portfolios and weekly notifications about other services provided by Zacks.
Each platform has different analyst ratings and opinions.
Zacks is quantitative and comprehensive in nature, covering stocks, mutual funds, ETFs, and options. It’s also broad, focusing on securities in all sectors of the economy, and categorizes its picks by value, growth, and momentum in addition to its famous rankings.
The Motley Fool is more narrow and focuses on recommendations from its staff, while Zacks’ recommendations are culled from analysts across Wall Street.
Motley Fool also focuses on long-term buy-and-hold strategies in next-gen companies, centering value. The Zacks Investment Research rating system is based solely on giving its members the most potential for profit in both the short and long-term.
Both platforms provide in-depth newsletters that recommend stocks on the basis of fundamental analysis. You will never be lonely by subscribing to either service because both are fierce about daily emails, follow-up recommendations, and breaking news.
The Motley Fool and Zacks each offer plenty of free content and tutorials. Their websites feature step-by-step instructions on how to capitalize on their products and provide a good sense of what to expect from your subscription.
The Motley Fool and Zacks have extraordinary track records of outperforming the S&P 500 over long periods of time.
If you’re still unsure about which company is right for you, Motley Fool’s Stock Advisor and Zacks’ Premium have a 30-day free trial (they will refund your purchase if you are dissatisfied).
Both The Motley Fool and Zacks have expanded their cryptocurrency investing resources and services for investors, so you can find guides on blockchain and crypto investing.
Fewer than 5% of all stocks receive Zacks’ top ranking, and a stock is only ranked No.1 if it receives both a fundamental analysis recommendation and its earnings estimates have been raised by several professional analysts.
Zacks’ claims its short-term trading perspective and longer-term fundamental analysis give subscribers an advantage. A host of analytical tools rounds out the offering, and Zacks also maintains a Focus List of 50 stocks for long-term performance.
Zacks also has services for more advanced investors which require a mastery of basic investing concepts:
Investor Collection is aimed at long-term investors. This service costs $59/month or $495/year, and features real-time buy and sell signals from the company’s long-term investor portfolios. It also offers a stocks under $10 strategy.
Ultimate costs $299/month, or $2,995/year, and includes all of the above, plus market insights and “private picks” from all of their portfolio recommendation services, even those closed to new investors. Ultimate provides strategies and portfolios (called “investment approaches”), which enable investors to find the best fit for their investment theme.
Zacks also offers a trading platform combining comprehensive services with low-cost fees, so you can do your homework and trade all in one place.
The Motley Fool offers several newsletters, organized around investment themes.
The founders review recommended stocks every week, and every two weeks they add a new recommendation (which is sometimes a previously recommended stock).
Subscribers also have access to the online website, which posts “best buys” from their active recommendations.
Sell recommendations are also posted, but they are rare.
Investors choose from a selection of stocks and are advised to select a minimum of 10 to hold for 3 to 5 years.
The flagship Stock Advisor newsletter costs $199 a year but is available now for $99 the first year to new members. American Express Platinum Cardholders, and their friends, will be reimbursed for the first year’s fees via AmEx.
There are also several other offerings from The Motley Fool that cater to different sectors and investing styles. Some of the other popular Motley Fool services include:
Rule Breakers, at about $299 a year, claims to double the number of Stock Advisor’s recommendations and focuses more on early-stage growth companies.
Discovery: Future of Entertainment focuses on companies in the gaming, streaming, and studio production ecosystem. Motley Fool claims these stocks are more volatile but offer greater appreciation potential on their way to becoming a multi-trillion dollar industry.
10X Portfolio examines Motley’s Fool’s past recommendations that have increased in value eight to 10X, and extracts from that experience a set of investment guidelines for choosing the stocks which it believes will also increase eight to 10X in the next 3 to 5 years.
Rule Your Retirement helps investors build a retirement portfolio that focuses on fixed-income and reducing risk.
Motley Fool Options is dedicated to options traders who want to explore various options trading strategies.
Both companies enjoy a sterling reputation for integrity among institutional and individual investors. Investors following the recommendations of Motley Fool and Zacks have dramatically outperformed the S&P 500 for two decades or more.
About The Motley Fool
The Motley Fool was founded in 1993 by brothers and equity analysts Dave and Tom Gardner. The company publishes stock recommendations in online newsletters. Its flagship product, Stock Advisor, is geared towards long-term DIY investors who like their fundamental analysis served entertainingly (hence their use of “fool,” as in a court jester).
The service has grown from recommending individual stocks to recommending portfolios of stocks around themes (e.g. entertainment, retirement, disruptors) for a 3-to-5-year hold. Almost all the companies are “next-gen” — companies whose operations are web-based (and primarily U.S. based.)
Although not explicitly stated, The Motley Fool’s fundamental bet is that companies pioneering the digital transformation of the industry will capture huge appreciation in the stock market.
About Zacks Investment Research
Zacks’ entire system is built around the idea that earnings estimate revisions — the raising or lowering of earnings estimates by the professional analyst community — exerts the most powerful impact on stock prices. Founded in 1978 by MIT Ph.D. Len Zacks, Zacks Investment Research adds a layer of easy-to-grasp quantitative analysis to stock recommendations, and also covers mutual funds, exchange-traded funds (ETFs), and even options.
For those of us who don’t love complexity, Zacks’ recommendations are based on a simple one-to-five ranking. In short, Zacks focuses on fundamentals and timing; it aims to provide a trading advantage to fundamental analysis, offering both short-term trading and long-term investment advice. Zacks’ recommendations are based on research from its team of analysts covering 1,050 stocks.