Not pumped at the pump Hybrid Images via Getty Images
You can’t turn water into wine, but sometimes vino can turn into $$: Since 2003, some fine wine indices have risen more than the S&P 500 or Dow Jones.
After a Facebook-fueled selloff earlier this week, stocks rebounded yesterday across all major indices. “Recovery stocks” spanning the cruise, airline, and retail industries also rose. Plus, Bitcoin climbed back over $50K, ticking up over 77% this year.
Grumpy at the pump… Oil prices spiked to a seven-year high this week, while US prices are up 63% this year — a dollar more per gallon than last year. The spike is weighing on drivers’ wallets and boosting inflation concerns because higher prices mean pricier goods. President Biden asked OPEC to crank up production to keep economic recovery on track. But earlier this week, OPEC’s powerhouses rejected the request and said they’d make only gradual production increases to help prop up prices.
A slippery slope… Demand for oil fell during the pandemic, when people stayed home and drove to the mall less. But demand rebounded faster than analysts expected. So to keep prices high and profits flowing, oil giants are capping supply. It’s paying off for oil companies, but costing everyone else:
The US economy still runs on gas… Just like your uncle’s ’64 Impala. Many investors are shifting their dollars toward renewables, but the US economy still depends on fossil fuels. High oil prices don’t only affect consumers; they can also up supply-chain costs and shape policy priorities. Oil has cracked the $80-per-barrel mark for the first time in seven years, and could hit $100 by winter. So even though US consumer spending has been rebounding this year, businesses like restaurants and retailers could suffer if consumers blow their cash on gas — and their products and services cost more.
Sounds like a hunting tool… actually a wine. Duckhorn Portfolio is Napa Valley’s first publicly traded winemaker in decades, and the stock (perfect ticker: NAPA) is up 20% since its $2B March IPO. Its 10 luxury wine brands include Decoy, Duckhorn Vineyards, and Kosta Browne, with bottles ranging from $20 to $200. Last quarter, the supplier swung a profit and beat pre-pandemic levels with 36% sales growth. Behind the boon:
One-stop wine shop… Empty vineyards and shuttered tasting rooms put a strain on most luxury vineyards during the pandemic. Duckhorn offset those losses by increasing its presence in grocery stores, where most consumers shopped, and by launching new products and features:
In crowded markets, differentiation is key... When customers walk into the wine section of a grocery or liquor store, they’re overloaded with options. While IRL wine tours paused and in-store and online shopping competition spiked, Duckhorn innovated to reach a target audience: millennials, who spend more per bottle than any other demo. Differentiation worked: Brand-new products like seltzers and its Alexa feature helped its wine portfolio sales grow faster than those of the other top 20 US suppliers.
Twitter is taking likes to the next level — and by that we mean $$.
Tune in on why it could spell trouble for the OG payment space.
Authors of this Snacks own shares of: Bitcoin