Key takeaways
- Apple and Alphabet surged over the decade following their selection, while Canadian National Railway and Disney lagged the broader market.
- The catalyst behind the strongest outcomes centered on leadership execution at Apple and business model diversification at Alphabet.
- Rail and entertainment results diverged from “low-risk” expectations as industry timing and competitive forces outweighed initial defensiveness.
- Ecolab’s turnaround underscored how operational resilience can take time to translate into share performance.
- Implication for investors: “low risk” can mean volatility control, not guaranteed outperformance over long horizons.
Shares of Apple, Canadian National Railway, Disney, Ecolab and Alphabet were revisited by Motley Fool co-founder David Gardner and analyst Rick Munarriz for a “10 years later” comparison of how five so-called low-risk picks performed after their selection in September 2016. The discussion highlighted that while some companies benefited from leadership execution and strategic diversification, others were dragged down by industry cycles, timing, and slower fundamental momentum—despite starting from similar “low risk” criteria.
What the “low-risk” sampler was aiming to capture
Gardner said the original one-year stock sampler, chosen in September 2016, focused on companies he viewed as comparatively low risk within his framework. He and Munarriz revisited whether that label held up across multiple years, arguing that risk can be interpreted in different ways: drawdowns and uncertainty versus long-run competitive and industry outcomes.
They also anchored the exercise to the performance of the broader U.S. market over the same decade, noting that the S&P 500 ETF gained 251.7% across the period described in the episode.
Apple’s decade-long outperformance: execution and margin expansion
Apple was described as an underappreciated stock at the time, trading at $27.09 in the week of September 2016 and closing at $319.97 at the referenced market close on the holiday-affected date in the episode. Munarriz attributed Apple’s results primarily to leadership transition, emphasizing Tim Cook’s operational focus after Steve Jobs.
According to the episode, Apple’s gross margins expanded for seven consecutive fiscal years, supporting the idea that the company converted its scale and product ecosystem into a more efficient, higher-margin business. Munarriz also pointed to the shift toward services as a factor in sustaining engagement and monetization over time.
Looking forward, Munarriz said the key question is whether Apple’s next chapter under John Ternus restores more product innovation while maintaining the operational foundation built under Cook.
Canadian National Railway: pricing power faded and momentum slipped
Canadian National Railway, selected as a durable “boring” pick, ended up underperforming the market over the decade. The episode cited a move from $65.05 in September 2016 to $123.37 at the end date referenced, translating into a gain of 90% versus the S&P 500’s 252% move.
Munarriz said rail results followed a clear “two halves” pattern. In the first years after the selection, railroads benefited from pricing power, cost discipline, and improved utilization, along with buybacks. Those tailwinds weakened during and after the pandemic as logistics patterns normalized and the industry’s relative advantages diminished.
He also highlighted a specific industry event: the Kansas City Southern acquisition process and the broader competitive dynamics tied to Canadian Pacific Railway, describing it as a reputational and momentum hit for Canadian National Railway even though it entered bidding with a higher offer.
While Munarriz noted that the stock had a better recent year, he characterized the prior four years before that period as difficult, reinforcing that “low risk” at the starting line does not prevent multi-year underperformance when industry conditions reverse.
Disney: brand strength, slower investor re-rating, and leadership churn
Disney’s decade performance stood out for Munarriz as being unusually flat relative to its scale and brand. The episode cited Disney at $93.71 in September 2016 and $105.31 at the referenced end close, while the S&P 500 rose substantially over the same window.
Munarriz pointed to three overlapping factors. First, Disney faced leadership churn, with multiple CEO tenures discussed in the episode, including Bob Chapek’s start amid the onset of the COVID crisis and later transitions that followed. Second, he argued that although Disney+ and Hulu had reached profitability and helped offset legacy network pressure, investor enthusiasm did not fully re-rate the stock into a faster-growth narrative.
Finally, Munarriz said Disney’s theme parks performed better on profitability even as attendance did not fully recover to pre-pandemic levels, supported by improved experiences and monetization. In his view, that overall progress did not translate into the kind of valuation premium investors may have expected a decade earlier.
Ecolab: a long transformation payoff, driven by shifting end-markets
Ecolab was positioned in the episode as a lower-profile but high-potential turnaround at the time, chosen partly because oil and gas exposure had been under pressure in 2016. The episode cited Ecolab moving from $122.74 in September 2016 to $279.28 at the referenced end close.
Munarriz said the key lesson was timing: the transformation didn’t show up immediately. He described the company as having pivoted away from energy-driven operations and into water, hygiene, and infection-protection solutions—supported by acquisitions. He also framed recent moves as shifting toward technology-adjacent demand, including cooling systems linked to data centers and pure water needs tied to semiconductor manufacturing.
He emphasized that revenue growth in the episode’s description remained slower than what investors might want, but argued that higher-margin businesses and integration from acquisitions were expected to “start moving the needle” as these segments scaled.
Alphabet: diversification beyond advertising and platform monetization
Alphabet, the final pick in the episode’s lineup, was highlighted as a winner driven by diversification and a broader monetization strategy. The discussion cited Alphabet at $39.02 in the week of September 2016 and $335.31 at the end close referenced, noting that the company later conducted a 20-for-one stock split in July 2022.
Munarriz said the company’s evolution mattered. While Google’s advertising revenue was still significant in 2016, he argued that over the decade Alphabet shifted further toward subscriptions, Cloud hosting, and a growing portfolio of bets ranging from YouTube services to autonomous-driving initiatives such as Waymo.
In the episode, Alphabet’s advantage was described as platform-driven: monetization built on a large audience and distribution, plus the ability to fund long-duration projects. Munarriz also pointed to investment in AI-related infrastructure, describing Alphabet as working on chips prior to the latest wave of AI market acceleration.
Bigger picture and what investors should watch next
Across the five companies, the episode’s core takeaway was that “low risk” does not guarantee that every pick will match the market over a decade. Instead, long-run outcomes depended on how leadership execution, industry cycle timing, and strategic repositioning played out after the initial selection. Investors watching similar frameworks may want to focus less on label definitions and more on the durability of cash flows, the direction of end-markets, and how quickly business model changes translate into measurable results.
For the next phase of this kind of long-horizon comparison, what matters most will be how upcoming leadership priorities and capital allocation decisions—particularly in areas like AI infrastructure, platform expansion, and cost structure—affect earnings power and competitive positioning over time.
