Herbert would like to gift stock to his nephew who helps with yardwork and repairs around the house. Assume that Herbert owns the stocks below and needs advice on whether he should gift the stocks outright or sell them and gift the cash. He provides the following information:

Which stock(s) should Herbert gift to his nephew? Why?

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Stock Cost Fair market value Coca-Cola $4,400 $5,000 Costco $1,500 $3,000 Sears $4,000 $ 100