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Hey Snackers,
Election Day is upon us (cue Beethoven's 5th). More than 93M Americans have cast pre-election ballots, almost 2X more than in 2016. This isn't a normal election or a normal day (even in 2020 terms) — we hope you'll partake in the history-making.
Stocks jumped after last week's plunge. Election uncertainty could cause more volatility. Here are some things to keep in mind when investing in turbulent times.
Biebs
Crocs is a thriving Belieber thanks to celebrity-studded collabs
I'm a croc-star, not a doctor... Crocs has evolved from "the ugly shoe" company to the celebrity shoe company. Since 2018, Crocs has collabed with stars like Post Malone, Luke Combs, and Korean rapper Psy (Gangnam Style). The KFC x Crocs partnership proved that the biggest star of all is a fried chicken wing. Now, Crocs is sticking even more celeb charms in its clog holes:
- Justin Bieber: Bieber's yellow clogs reportedly crashed the Crocs site when they dropped (still sold out). Crocs stock jumped 11% when Biebs teased the collab on IG.
- Bad Bunny: The Puerto Rican rapper's $60 glow-in-the-dark Crocs sold out in less than 30 minutes. He Like It Like That.
Ariana, Selena, my Visa... These Bieber-faced collabs have paid off. Last quarter, Crocs' sales rose 16% from last year to a record $362M, and profit nearly doubled. The greatest growth was in the Americas — but sales also spiked in Europe, the Croc-shaming capital of the world.
Functional is the new fashionable... during this COVID anti-fashion moment. From bulky sweats to fuzzy socks, whatever's comfy for Zoom'ing and grabbing the mail wins. That's why Crocs sales are up 48% this year, while US footwear sales are down 20%, according to a research analyst. Crocs stock (fun to say) has nearly 5X'd in value since the market tanked in March. As far as we know, it's the only pure-play ugly shoe stock.
Heat
Nestlé shows up late to buy meal delivery startup Freshly for up to $1.5B
Nespress yourself... As America's largest food company, Nestlé makes everything from Hot Pockets to Kit Kats — and anything that begins with "Nes" (presso, tea, quik). Now, Nestlé's expressing its love for all things edible with a meal delivery purchase:
- Nestlé USA is buying Freshly for up to $1.5B. The healthy meal subscription startup sends you buttered salmon and kale to heat up between Zoom calls.
- Freshly ships more than 1M meals per week across 48 states, and expects $430M in sales for 2020. But don't expect any Nesquik boxes...
Say it again... Freshly’s CEO wants to make it veryyy clear that Nestlé won't be a cook in its kitchen: “Our meals will not be changing...there are no plans to change ingredients or integrate Nestlé products into Freshly meals” (burn). Freshly will run as a standalone biz, and pricing won't change.
- What Nestlé gets: A promising company in a fast-growing, pandemic-friendly industry.
- What Freshly gets: $950M, with possibly $550M extra. Freshly can scale faster with Nestlé cash — it's already planning to triple its menu offerings with the fresh $$$.
Big shots can afford to be late... Nestlé was an early investor in Freshly — in 2017 it snatched a 16% stake to "evaluate" the up-and-coming meal delivery market. Now Nestlé has decided it's safe to go all in (you think?). Massive companies can afford to be late to trends because they can buy already-successful companies, skipping the time and risk needed to build from scratch.
What else we’re Snackin’
- Squeaky: Clorox's quarterly profit doubled, and sales shot up 27% on demand for sexy products like disinfecting wipes and trash bags.
- Coolater: Dunkin''s officially going private — Arby's owner Inspire Brands is snatching up Dunkies for a sweet $11.3B (including debt).
- Prep: Estee Lauder saw strong skincare sales led by its namesake and La Mer, but makeup fell for all brands except Too Faced.
- Fribble: "Iconic" restaurant chain Friendly's files for bankruptcy (again) and plans to sell itself for $2M.
- Dramatic: Cash-starved theater chain AMC is looking to raise up to $50M to stave off bankruptcy by selling its stock.
- Unmusked: Tesla’s Autopilot was ranked a ‘distant second’ to GM’s Super Cruise system in Consumer Reports testing.
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