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When a $4 billion unicorn messes with your Tabata routine

The Best Damn Week In Review Anywhere
October 22, 2018

Last Week
Dow Jones: 25,340 (+0.41%)
S&P 500: 2,767 (+0.04%)
Nasdaq: 7,449 (-0.64%)
Bitcoin: $6,240 (-4.53%)
10-Year Treasury: 3.162%

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1. Stock market winners...

Pretty, pretty, prettayyyyy good... 7 million more humans started wasting time via Netflix last quarter to make it 137 million total. That's $4 billion in more revenues for the streamer, and shares surged 15% because of it. We're more impressed with how its shows powered up the Instagram accounts of 10 of its stars by over 100 million followers total.

Best Buy's happy with 2nd best... and a participation trophy. While Sears was busy filing for bankruptcy, Best Buy's shares popped because it'll probably snag all that business if you need a non-Amazon place to buy anything that plugs in. Get this -- 85% of Sears' locations are within 5 miles of a Best Buy store.

Walmart's slipping into something more comfortable... It bought online lingerie retailer Bare Necessities for its 2nd lingerie splurge in a month (September was all about acquiring plus-size leader Eloquii). Why innovate yourself when you can just buy 8 direct-to-consumer brands in the last 3 years? (yes, Walmart did that).

Behind every IPO... is a bank expensing expensive lunches while taking a tefch company public. Goldman Sachs and Morgan Stanley dominate that right now. Eventbrite, Docusign, Farfetch, and Sonos all IPO'd this year -- that powered up revenues for Morgan's equity division by 61% and Goldman's by 20%.

Single and looking... That's the relationship status of your data on Facebook. To combat the complete lack of trust users have with the 'Book, Zuckerberg hired former UK deputy Prime Minister Nick Klegg to handle PR and global affairs. Good luck. Have fun. But good luck.
 

2. ...And stock market losers

Too chill... Five years ago Canada had zero publicly-traded cannabis stocks. Now it's got 43, and shares of a couple trade down in the US. Even though the North officially legalized recreational pot sales last week, green stocks like producer Tilray fell -- probably because it's already up 390% this year in anticipation of all this.

Slap the bag on your way out... Liquor legend Constellation Brands is losing CEO Rob Sands. He's the 3rd Sands to lead the family company, transforming it from just boxed wine to a stocked bar owning Corona, whiskey, vodka, and a $4 billion bet on cannabis stocks. Shares were up 967% while he was behind the bar.

Too bad you can't bid on eBay... for shares of eBay stock -- they fell almost 10% Friday because of PayPal. That's its main payment processor, and PayPal's earnings report turned into a charming little window into activity at eBay. Apparently sales are slowing for the OG of online bidding.

Earth falling apart = Really, really expensive... for everyone. Especially AIG. One of the world's biggest insurers decided to warn everyone that it's about to shell out $1.7 billion in "catastrophe" losses courtesy of Japan's 2 typhoons, California's mudslides, and Hurricane Florence.
 

3. Peloton reinvents the treadmill -- and declares war on gyms

If you're reading this at 8.2 speed, 1.5 incline... listen to our podcast instead (what you're doing's really dangerous). We've talked about Peloton, the $4 billion tech unicorn that builds cycling machines streaming spin classes through a video monitor. Now it's got a treadmill and said it's going to make gyms extinct.

Dark room. Sweaty humans. Sandstorm beats blasting... That's how intense CEO/Founder John Foley is. He thinks affluent Gen X and Millennial hardbodies will stop schlepping to gym studios and crush their quads at home instead. And Peloton's price story is compelling:

  • The bike: $58/month (or buy the whole bike upfront for $2.5K)
  • The "tread" treadmill: $110/month (or $4K upfront)
  • Live stream "class pass": $39/month
  • Do the math and that's cheaper than a SoulCycle addiction or a staph-infected weight room


The Takeaway: It's the Netflix of Fitness... and that can scale. Foley thinks video games are a better comparison -- When you started playing "Street Fighter" at home, arcades went under. When you can tap your booty back on your basement Peloton for cheaper than your monthly gym splurge, you'll probably cancel that membership guilt-free.
 

4. Political fights keep haunting stocks 

The Fed: Accept all the credit, none of the blame. After the S&P 500 fell 5% the past month, President Trump hated on the Fed as our "biggest threat." But the nation's central bank is all rubber, no glue -- Chairman Jerome Powell's still raising interest rates to yank in the hot economy, even if that means stocks tumble a tad.

China: China's lost some mojo as the government-reported econ growth rate dipped to 6.5% last quarter, the slowest pace since '09 (data from China's government is usually rosier than reality). China's stock market's down 30%, its currency's 10% weaker, and its version of SNL got shut down in just 1 month.

The Takeaway: The Trade War's feeling out a winner... US imports/exports weigh less on its economy (as a percentage) than they do for China. It's the profits that feel the hard burn (Ford's lost $1 billion from the Trade War so will lay off 24K workers). The US economy's employment data are living their best life, so expect Trump tariffs to stay if the US can outlast China.
 

Venture of the Week: BeenThere

B-School applications are hard (we've been there).

14 hours and 0 pages later... your business school admissions essays could use a little love (and another anti-writers block "I-deserve-this" cupcake break).

H-E-L-P?... It's expensive (those $$$ consultants), disconnected (your uncle Jim's your proof-reader), and un-strategic (someone's sister's friend said they want to see your "signs of leadership"). BeenThere is brilliantly fixing all that as a platform.

We found the only online advice marketplace with actual MBAs... Launched by Kellogg and Wharton founders, BeenThere connects current b-school students with prospective applicants to craft the most concise resume bullets or pivot that admissions essay about the summer you found yourself in Barcelona.

We're down with democratizing... and that's what BeenThere's doing for the b-school admissions process: 150+ mentors across 20 top MBA programs with hundreds of current users.

What else we're 'Snacking

  • Career: 12 things on your work desk that look unprofessional (@stickynotes)
  • Life: The ancient Swiss town that turned itself into 1 giant hotel (to survive)
  • Money8 ways to negotiate to a six-figure salary
  • Venture: 3 viable alternatives to venture capital funding for founders
  • Crypto: Your computer may be quietly mining Bitcoin for someone else

On Today's MarketSnacks Daily Podcast

  • Skechers enjoyed a record quarter since ugly is fashionable again
  • Venmo's new plastic debit card powered PayPal's 10% stock jump
  • Procter & Gamble is our "Comeback of the Day"
 
Just Push Play:

'SnackFact of the Day
Launching a startup? Do it on a mid-September Monday -- That's the most productive day of the week and most productive time of the year
Submitted by Max L. (Richmond, VA)
Send Us One

This Week

  • Monday: Trade Balance Report
  • Tuesday: Saudi Arabia's "Davos in the Desert," Earnings from Harley-Davidson, Lockheed Martin, McDonald's, Verizon, Snap
  • Wednesday: Earnings from AT&T, Callaway Golf, Ford, Microsoft
  • Thursday: Earnings from Alphabet, Chipotle, GrubHub, Twitter
  • Friday: US GDP Report
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