Hey Snackers,
We've got that deep-fry turkey recipe right here for you (pro tip: avoid canola oil at all costs).
Markets enjoyed their 4th straight weekly win thanks to more news that American consumers are spending happy. Perfect timing for big box retail chains to report their earnings this week.
Peer pressure from Wall Street to Canada... Last week the top 4 cannabis stocks announced how the 3rd quarter went. One year since pot's legalization up north, it's time for investors to assess how much Canada is smoking. The answer: not much. The result for the stocks was even less fun.
-52%... That's the average stock price change in 2019 so far for those top 4 weed dealers. Canada legalized recreational marijuana use (leaves and oil) in October 2018 — aka "Cannabis 1.0." In October 2019, it white-marketed other ways to get the green, including edibles, vapes, and THC-infused drinks — aka "Cannabis 2.0."
New industries are often over-hyped... Huge cannabis oversupply in the last year dropped Canopy's average price per gram sold from about $8 to $6 last quarter. The CEO basically admitted that they overestimated how much weed Canada wanted to smoke. That's not the first time we've seen over-exuberance for brand new industries:
It's not you, it's Nike... The swoosh broke up with Amazon after 2 years selling its gear on their site. Nike traded its CEO out for a former eBay exec last month, so it's put him to work by funnelling customers away from Amazon.com to Nike.com instead. Nike could benefit by cutting out the middleman, controlling your online sneaker-buying experience, and getting your email address to pester you with promo emails.
Toss some pixie dust on it... Disney+ officially launched, snagging over 10M new accounts in the first 24 hours (despite Day #1 glitches). But even if it gets 100M people to sign up, all those $6.99/month subscription revenues would only make up about 10% of Disney's total revenues. What Mickey really wants is hooking you on the Disney lifestyle to buy movie tickets, Disney World vacays, and Frozen lunch boxes.
$5.8B... That's how much we spent on the last Amazon Prime Day. Alibaba's Singles Day enjoyed sales 7-times that: $38B (fun SnackFact: Taylor Swift sang at launch concerts for both insane faux-holidays). The Chinese ecommerce firm transformed the day honoring singles into an ecommerce splurge-fest that out-sold Prime Day in its 1st hour. But Alibaba stock fell because investors expected even more. Rule of thumb: Stock price movements = expected news - actual news.
We have plenty of printers, thanks... Instead of obsessively watching their fantasy football score, the board of HP unanimously rejected Xerox's offer to acquire it for $27B. It would've been a strange deal since Xerox is 1/3 the size of HP (picture Robin inviting Batman to join his crime-fighting team) — but together, the combined company would've saved an estimated $1B annually (just 1 accounting team and 1 holiday party, instead of 2 of each).
Disclosure: Authors of this Snacks own shares of Tesla, Alibaba, and Amazon.
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