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Posted
1 hour ago, horn4life said:

Snack food exposure mostly. They overplayed their hand on price increases as well IMHO.  The weight loss drugs weigh on the snack end as well.  Just more exposure to more headwinds.  And I think the profits from the cheap high calorie junk food in small packages is eroding with overall less fat people due to GLP1 drugs. And more potential exposure to tariffs on raw materials for snacks.

KO - main exposure is aluminum cost.  And I believe (from memory) that their solution there would be to shift to bottles if necessary. So not the investor concern from the fat /tariff perspective for Coke than with Pepsi.  

 

1 hour ago, Bateshorn said:

I sold the Pepsi I've had forever this year for this reason.  My wife went on a GLP-1 and watching her make a face when I offered to pick up snacks during a road trip, when in past years she'd be like an 8 year old in a 7-11 with a $20 bill, was an eye opening moment. 

I've heard similar theories about the potential cliff ahead for alcohol bev companies.  Studies show that 20% of Americans account for ~90% of alcohol sales. With the "top" 10% the vast majority. There are signs that GLP1 drugs can curb alcoholic tendencies as well as overeating. If just half of alcoholics could be successfully treated with these drugs, the alcohol industry would collapse.

I guess it's theorized to be the same for soft drinks and snacks.

Posted
2 hours ago, Nice Guy Eddie said:

Your post had me check PEP vs KO. Over the past year, KO is up 20% and PEP down 18%. Why the discrepancy when they had tracked closely for the previous 4 years? Has Pepsi made some missteps along the way?

 

2 hours ago, horn4life said:

A good chunk of my wife's inheritance will be in PepsiCo Stock, so interesting to see a bedrock dividend/growth company in such a rough patch.  But the fat drugs, tariff pressures on supply chains, and the bonus of needing to potentially adjust across that chain with dye removal. Earnings miss and guidance cuts due to tariff uncertainty.

 

 

https://www.wsj.com/business/retail/pepsi-soda-tariffs-manufacturing-coca-cola-76dffe02

 

Spoiler

Pepsi was already losing the cola wars. The trade war isn’t going much better.

It all comes down to where PepsiCo and Coca-Cola make the secret-recipe concentrates that are the essence of their sodas. Concentrates are made in special facilities, then shipped to bottling plants. There, they are combined with water, bubbles and sweetener to make soda.

PepsiCo more than 50 years ago began making concentrate in Ireland because of the country’s low corporate tax rate. Now, PepsiCo’s tax-saving move has backfired: The concentrate for nearly all U.S. sales of Pepsi and Mountain Dew is subject to a 10% tariff. 

Coca-Cola for decades has also produced concentrate in Ireland, shipping it to markets around the world. But Coca-Cola makes most of the concentrate for its American sodas in Atlanta and Puerto Rico, a U.S. territory. That means drinks like Coke and Sprite are less exposed to tariffs.

“Ireland has long had the tax advantage—until the tariffs hit,” said Carlos Laboy, an analyst at HSBC. No one could have seen the tariffs coming, and it is unclear how long they will last, but Pepsi clearly is at a disadvantage now, he said.

Coca-Cola and PepsiCo both could be hurt by a 25% tariff on aluminum imports imposed by the U.S. in March. Coca-Cola imports some aluminum from Canada, and soda prices could rise as a result of the levy, Coke Chief Executive James Quincey said in February. He said that his company could ease the impact by packaging more drinks in plastic bottles or sourcing aluminum from the U.S.

The tariff war comes at a particularly bad time for PepsiCo. Pepsi’s U.S. market share has plummeted over the past two decades, and last year hit a new low when Dr Pepper unseated Pepsi-Cola as America’s No. 2 soda. After years of focusing on food and energy drinks, PepsiCo is now trying to revive its U.S. soda sales. The new tariffs could make that more difficult.

PepsiCo also makes concentrate in Texas, Uruguay and Singapore. The company declined to comment on what steps it might take to mitigate tariffs. It also declined to say whether the levies could drive up prices for sodas like Pepsi or Mountain Dew.

The cola wars aren’t the only rivalry whose scales have been tipped by tariffs. In the world of bluejeans, Levi Strauss sources from many countries whose goods are now subject to 10% tariffs. Wrangler’s parent company, on the other hand, makes 40% of its jeans and other pants in the Western Hemisphere, including seven facilities in Mexico. The products Wrangler makes in Mexico are compliant with the U.S.-Mexico-Canada Agreement trade pact, and so are currently exempt from the 25% tariff on Mexican imports President Trump introduced earlier this year.

The escalating tariff war could also embroil toothpaste makers. Most of the Crest toothpaste consumed in the U.S. is made domestically, while Colgate produces some of its U.S.-bound toothpaste in Mexico. 

For PepsiCo’s independent bottlers—many of them family-owned businesses whose sales have been hurt by Pepsi’s market-share decline—the trade war is a fresh blow.

Bottlers receive small orders of concentrate in 55-gallon containers; large orders arrive in tanker trucks. Some independent bottlers say they expect tariffs on concentrate to push up their costs, and worry that the trade war could make it difficult for PepsiCo to compete with its rivals.

PepsiCo opened its first concentrate plant in Ireland in 1974. In the Irish city of Cork, PepsiCo now operates its global concentrate head office, two concentrate plants and a research and development center. And the soda giant recently doubled down on Ireland: In 2022, it invested 166 million euros, or about $189 million, in its manufacturing facilities in Cork.

Keurig Dr Pepper opened a concentrate facility in Ireland in 2022, but also makes concentrate in St. Louis. The company declined to say how much it imports to the U.S.

 

 

 

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Posted
15 minutes ago, Nice Guy Eddie said:

 

I've heard similar theories about the potential cliff ahead for alcohol bev companies.  Studies show that 20% of Americans account for ~90% of alcohol sales. With the "top" 10% the vast majority. There are signs that GLP1 drugs can curb alcoholic tendencies as well as overeating. If just half of alcoholics could be successfully treated with these drugs, the alcohol industry would collapse.

I guess it's theorized to be the same for soft drinks and snacks.

Yeah, I have concerns about alcohol companies as well. The younger generation has a significant contingent that drinks less or not at all. The health impacts of even moderate drinking are starting to become more mainstream. California vineyards have been ripping out vines due to decreased demand after years of growth. The cost of going out and drinking certainly plays a part but I think the culture shift is the bigger issue.

With that being said, the best stock I own in PM so you never really know.

Posted

Anybody here long on PLTR?  It's back to where I sold off, and software is one spot where tariffs don't hurt your bottom line.  But I came in, bet against and got out both times, as if you get caught on the wrong side of momentum it can move up and down pretty violently.  Should have just tossed some money at some $100 calls as an upside hedge when it was bouncing off the low 80's.  It should have a resiliency, but now I have a lot more sensitivity to that high valuation.  

But my concerns are mainly inflation handcuffing the Fed over time.  And none of those have hit the market statistically, so a short term covered call on PLTR might   Bot PLTR and MP are about where I sold the last of my shares.  The PLTR ride got me the opportunity to take some downside risk that played out.  MP - was one I should have bought in the mid-teens but my shares drifted in the mid $25s and then my stop hit one day.  Both have good long term Trump Administration upside.  So I may take a few covered call bites as a hedge back on some shit I can either make some call income on, or end up with a stock at a discount I think will do well longer term....  So... PLTR... I do like that company...

Shit... this is day three? of a softer tone on trade?   

Posted

OK had to get a taste of hedge crack... PLTR May 9th covered calls at $108 and $115, with my cost avg $99.00.   So I will probably fuck myself both directions.... 40K dow within sight.

Posted
17 minutes ago, horn4life said:

OK had to get a taste of hedge crack... PLTR May 9th covered calls at $108 and $115, with my cost avg $99.00.   So I will probably fuck myself both directions.... 40K dow within sight.

I’m long PLTR. I acquired my position when it was under $10/share. I’ve sold some during its rise so that my current holdings are essentially free. At this point, I will sell covered calls on significant moves up to generate some premium income for a portion of my shares.

The valuation is troubling. however I do believe in its growth prospects and anecdotally, I’m hearing good things about their non-government business.

 

 

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Posted
51 minutes ago, hornmpa96 said:

I’m long PLTR. I acquired my position when it was under $10/share. I’ve sold some during its rise so that my current holdings are essentially free. At this point, I will sell covered calls on significant moves up to generate some premium income for a portion of my shares.  The valuation is troubling. however I do believe in its growth prospects and anecdotally, I’m hearing good things about their non-government business.

Yeah I rode it up, busted down, then just gradually bought in, using covered calls on the bounces to create income. Then on the steeper dips buy in deeper with in the money call options, and way OTM calls in the distant future as throwaways (assuming OTM expiration) in case the calls I sold on a bounce might all exercise on an untimely big bounce.  But with the volatility of the stock if it both my calls are exercised I make like 9% in two weeks.  Now earnings reaction could make folks dump too, idk?  But momentum drives this thing up and down. But basically I am getting back in a price 6% less than the last shares I sold.  NOT FREE like you!  But I need to add some more upside hedge and I also think their private sector growth is gonna be good. 

I do worry about penetration in Europe being an issue, with a potential Ukraine pull out? Or Karp might be crazy enough to just give the tech to Ukraine, and become the darling of Europe?  I like that last one. 

Posted
2 hours ago, hornmpa96 said:

The valuation is troubling. however I do believe in its growth prospects and anecdotally, I’m hearing good things about their non-government business.

What's troubling about a $250B+ Market cap stock trading at ~85X sales and a 550+ PE while sporting a 3 yr CAGR less than 30%🤪? In reality, they have shot so far past any semblance of reasonable valuations that if I owned the stock, I wouldn't care at all about valuation. Its another TSLA....nobody cares. 

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Posted
5 hours ago, Nice Guy Eddie said:

 

Studies show that 20% of Americans account for ~90% of alcohol sales. With the "top" 10% the vast majority. 

Starship Troopers GIF

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Posted
1 hour ago, Blotto said:

What's troubling about a $250B+ Market cap stock trading at ~85X sales and a 550+ PE while sporting a 3 yr CAGR less than 30%🤪? In reality, they have shot so far past any semblance of reasonable valuations that if I owned the stock, I wouldn't care at all about valuation. Its another TSLA....nobody cares. 

It’s funny - when I originally starting buying PLTR, I thought this was a $25-30 stock trading under $10. I’m just happy to be on the rocket this time on the way up. 

Posted
6 hours ago, Larry T. Spider said:

Yeah, I have concerns about alcohol companies as well. The younger generation has a significant contingent that drinks less or not at all. The health impacts of even moderate drinking are starting to become more mainstream. California vineyards have been ripping out vines due to decreased demand after years of growth. The cost of going out and drinking certainly plays a part but I think the culture shift is the bigger issue.

With that being said, the best stock I own in PM so you never really know.

I’m a fan of MO and PM dividends but I think they’re horrible companies. 
 

I have to think that we will soon see a glut of bourbon in the near future. the distilleries have expanded and started up over the past decade or so, and have been storing more barrels than ever before. Tastes always shift and I could easily see bourbon failing in terms of popularity. And not that everyone will turn away from bourbon but I can see supply greatly outpacing demand.  All good news for someone who likes bourbon.

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Posted
8 minutes ago, Nice Guy Eddie said:

I’m a fan of MO and PM dividends but I think they’re horrible companies. 
 

I have to think that we will soon see a glut of bourbon in the near future. the distilleries have expanded and started up over the past decade or so, and have been storing more barrels than ever before. Tastes always shift and I could easily see bourbon failing in terms of popularity. And not that everyone will turn away from bourbon but I can see supply greatly outpacing demand.  All good news for someone who likes bourbon.

Rash of unexplained fires and some epic insurance claims.

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