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Will the Bull keep charge this week?

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Will the Bull keep charge this week?

Where do you spend your paycheck… Walmart, Macy’s, or Home Depot? If none of those businesses, than probably somewhere else (most likely Amazon, am I right?). However, those three companies listed are releasing earnings this week and represent an essential indicator for how well the US economy is doing. Consumer spending accounts for two-thirds of our economy and how much people are spending can be uncovered in the financial health of stores.

 

We will see second-quarter earnings… and also be paying close attention to retailers’ outlooks for the rest of the year. Many moving parts go into these outlooks, such as inflation, wage growth, gas prices, and tariffs, to name a few. But in terms of consumers spending, May and June went well, and more of the same is expected for July.

 

Healthy retail sales… could give the stock market a bump this week. Some believe that the strength of the consumer and retailers has not been adequately accounted for in the market to this point. So will we break records this week – the S&P 500 currently sits 1% below its January record-high so it could happen. Stay tuned to see if the Bull keeps runnin’…

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Amazon looks to take a bite out of Apple

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Amazon looks to take a bite out of Apple

Look out Apple… because Amazon is hot on your trail to becoming the second trillion dollar company.  With shares of Amazon up 2% on Monday, the company hit a new all-time high and got just a bit closer to the prestigious market cap. Moreover, with the way this year has been going, it probably won’t be long until Apple has a new friend (or competitor) at the top.

 

Amazon is up… 65% in 2018 alone. How are they doing so well? It is hard to pinpoint that because the company makes money from retail, cloud services, media, gadgets, and now possibly even health care will be a cash cow for Amazon. No matter how they are doing it, some analysts are predicting company sales to go up 32% this year.

 

Amazon will join Apple… however, will they surpass them? The consensus target price for Amazon is $2,100 per share, giving the company a $1.02T valuation. Apple’s target is set at $216.40 which gives them a valuation of $1.05T. So, maybe not yet, but time will tell. We’ll also keep you updated on Alphabet and Microsoft, two other companies poised to hit the trillion very soon.

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Why Pizza Hut’s “Pie Top” sneakers are a genius

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Domino’s has brought us pizza with… drones, robots, and reindeer. Pizza Hut gave us bluetooth-enabled sneakers that can order pizza and parkas made out of the insulation used in their delivery pouches. You may have noticed a few of these stunts and wondered what the point of them are.

 

Believe it or not… there is a method to the pizza-gimmick madness. Domino’s wants to make it clear that they are delivery experts – whether by car, drone, or reindeer. Delivery is vital to pizza chains because more people get pizza delivered compared to other forms of fast-food.

 

Not just built for delivery… Pizza Hut focuses on convenience with their “Pie Top” sneakers and zero-click ordering (open their app, and it will order pizza unless you opt out in 10 seconds). These gimmicks may seem stupid, but they are quite the opposite. In a world where most people don’t debate ‘Domino’s vs. Pizza Hut,’ these companies need to find ways to stand-out against one another. So no matter how dumb – they grab our attention (see, we’re talking about it right now) and get us thinking about the cheesy goodness.

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Did Elon Musk ‘catfish’ everyone online about secured funding?

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Did Elon Musk ‘catfish’ everyone online about secured funding?

So, was he full of… crap, or was Elon Musk telling the truth last week when he tweeted that Tesla had secured funding to take the company private? Well, according to the Tesla CEO, the Saudi wealth fund will take the electric car company private – and they have spoken about this matter multiple times. So (apparently), the funding is just a matter of crossing some T’s and dotting some I’s.

 

Buying all of Tesla’s shares would cost… $72 billion, which is a steep price for anyone to pay. However, it won’t be quite that much because Musk plans to retain his 20% stake in Tesla and expects many others to do the same. Musk estimates that about two-thirds of shareholders would keep their shares, which would make the cost of going private around $24 billion – still the fourth most expensive deal to take a company private.

 

But there are still plenty of doubters… shares were up 3% early on Monday, but those gains were short-lived. While many investors seem to like the idea of Tesla going private, they won’t be buying until things are a little more certain. The funding is secure, but the rest of the deal not so much.

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Pandora is not looking so “charming” to investors

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Pandora is not looking so “charming” to investors

When you think of Pandora… you probably think of the bracelets because that is just about the only thing the company is known for. However, what was once a blessing is now a curse for Pandora. The stock is down over 50% this year, and that is mainly due to changing fads and the declining popularity of the famed charm bracelet. Charm sales were down 7% in the first quarter.

 

People want simple… and ‘minimalist’ looks – and Pandora charm bracelets are anything but that. Well, the bracelets are, but the charms are not. At least that is the theory of CEO Anders Colding Friis. However, others believe that the bracelets are out-of-style entirely. As if to say, “We aren’t worried about the charm business; we are worried about your charm business.”

 

We are not a fad… is what Pandora wants you to know, but of course that’s what they want you to know. At any rate, the company will continue to grow the business by moving into other segments of the jewelry market. You know, the rings, earrings, necklaces, etc., are all opportunities for the company. What do you think – is Pandora done for?

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Will people begin to pass on MoviePass for Movie Club?

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Will people begin to pass on MoviePass for Movie Club?

One movie, one low price per month… is what Cinemark’s Movie Club offers to their subscribers. The service costs $8.99 and excludes 3D and IMAX movies. If you don’t use your ticket, it can be rolled over to the following months and does not expire. So, during times when there seems to be nothing in theaters, you can hold out until there is.

 

Let’s be real… you don’t want to see four or five movies per month in theaters. If you’re a casual moviegoer, one or two films per month will probably do it. You can also purchase non-member tickets for $8.99 and get 20% off at the concession stand (or continue to sneak your own candy in). In short, Movie Club is making going to the movies more affordable.

 

Unlike MoviePass… Movie Club looks to be much more sustainable. The service has 350,000 members and is expecting to reach over half a million in the next few months. However, the company still should worry about AMC theaters and their Stubs A-List service which has 175,000 members and growing. But with the box office performing exceedingly well lately, there should be no shortage of opportunities to “wow” the moviegoers this year and next.

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Casper is coming to a store near you

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Casper is coming to a store near you

But not the friendly ghost… rather the people that deliver your mattress in a box. The mattress company Casper is planning to open 200 stores in the United States over the next three years (they currently don’t have any). This move is an interesting one because there are so many people that believe brick-and-mortar is dead and online is the way to go.

 

Having physical stores… can boost offline sales, but that presence can increase online sales, as well. That makes for a good point because if you aren’t shopping for a mattress, it’s possible you have never heard of this company. However, most people have heard of either Mattress Firm or Sleepys who have plenty of stores across the country.

 

Casper in, Mattress Firm out… because while Casper plans to open stores, Mattress Firm has closed 200 stores in 2018. Casper began by thriving online and is now using brick-and-mortar to achieve scale advantages. On the other hand, the brick-and-mortar stores are closing up and trying to figure out the online side of things. So, don’t get too comfortable because the mattress market is heating up…

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Elon Musk tweets his way to another lawsuit

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Elon Musk tweets his way to another lawsuit

Remember when… we mentioned that Elon Musk claimed to have secured funding from a mystery company to take Tesla private? Well, some people are calling BS on his claim – in federal court. And upon the announcement, Tesla’s share price soared because that announcement was good news (for some).

The motive… was to harm short-seller with false information. According to the complaint, Elon Musk tweeted news that was materially false and misleading to get revenge on those short-selling doubters. Short-sellers make money when the shorted company’s stock price goes down, so you can see why Musk has a bit of disdain for those people.

Here’s how Tesla loses… the company could lose if they did not seek or secure funding. Elon Musk must prove that his tweets about the funding were made in good faith – in other words, was he being honest? He can seek to hurt short-sellers (actually, he should always be doing that), but only with claims that are true. But we’ve been saying it for weeks – the Tesla CEO needs to stay far, far away from Twitter.

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Coming to a location not-so-near you… unless you happen to live in India, then maybe it will be near you. That’s right – Ikea is making their long-awaited debut in India, one of the world’s largest markets. The furniture company is open for business today as you are reading this and is expecting up to 7 million visitors each year at the new location.

Not one, not two, not three… but twenty-five is the magic number of Ikea outlets that the company plans to open around the country by 2025. Eventually, people will be seeing the giant blue and yellow signs in over 40 cities. This is not a cheap investment, either – each store costs 10 billion rupees to open. Which amounts to about $145 million for those of you that can’t convert rupees to dollars on the spot.

The future of Ikea… is in India, according to CEO Peter Betzel. With a massive population of 1.3 billion, with over half of that number being under the age of 25 (i.e., probably broke like most of us), you can see why this is an exciting opportunity for the company.

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Walmart is now the ‘Twinkie Killer’

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Walmart is now the ‘Twinkie Killer’

Walmart takes away shelf space… for Twinkies and Hostess drops 16%. Yes, things like shelf space at Walmart can make a stock plummet. Hostess pointed the finger at the retail giant for their missed earnings in the second quarter. This is not good news for a company trying to recover after filing for bankruptcy six years ago.

Twinkies, Ho Hos, and Ding Dongs… are all delicious, but people have been turning their backs on them in recent years. The company has been dealing with high costs and decreasing demand. With this information, the lack of shelf space may be warranted by Walmart.

The stock is down… 24% this year and 14% since May alone. Perhaps people have been sculpting their beach bodies and have stayed away since May? Meh – probably not. Regardless, the company believes it still has the pieces to be a thriving company for years to come. I agree with that statement – because junk food never goes out of style.

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