The Best One Yet - “1 Bitcoin = 1 Model Y” — Elon’s crypto-for-cars. Hershey’s s’mores surge. Target’s $1B yoga pants.

Episode Date: February 9, 2021

Elon wants to trade cryptocurrency for Teslas, popping Bitcoin’s price above $45K. Hershey’s gets some investor love before Valentine’s Day thanks to the great s’mores surge. And Target’s athleisure brand hits $1B in sales because the target logo is nowhere to be seen.$BTC $TSLA $HSY $TGTGot a SnackFact? Tweet it @RobinhoodSnacks @JackKramer @NickOfNewYorkSend us your Black History Month SnackFact here:https://docs.google.com/forms/d/1Hu00HOlQ-qb6S7Jx4CgnGOfzrA67_j_SLFqxvFKinEQ/editWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Got a SnackFact? Tweet it @RobinhoodSnacks @JackKramer @NickOfNewYorkLearn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. And this is Snacks Daily. It is Tuesday. T-Boy Tuesday, February 9th. Is that a six-day winning streak for the Dow? Jack, it's the old double hat trick. Are we talking all-time highs here? We are talking all-time highs, and this is the best one yet. Yep, T-B-O-Y. Jack, what's our first story today? Elon Musk wants to make a deal. One Bitcoin for one Tesla Model Y. Jack, you got cash for clunkers. This is crypto for cars. For our second story, Hershey Stock is hitting a peak right before Valentine's Day. It all came down to one thing, though. The great some more surge of 2020. By the way, everyone, it's on Sunday. Valentine's Day is Sunday.

Third story. Target's athlete's brand just hit $1 billion in annual sales. Nike, Lulu, Loo, Athleta. Target? I'm Ron Burgundy. But Snackers, before we hit that wonderful mix of stories, happy T-boy Tuesday, a couple weeks ago, Jack and I happened to mention Detroit-style pizza.

But then we ended up discussing Coney Island hot dogs and the origin of the Frankfurter instead. Yeah. We ended up in Austria. We digress. Sometimes we're just going in different directions. You never know what's going to happen

on this pot. But Snackers, we cannot overstate the importance of understanding Detroit-style pizza right now. And that's because first came the Spike Seltzer Wars. Then came the fried chicken wars.

Well, Snackers, we want to warn you, prepare for the Detroit-style pizza wars. Nick and I just jumped in snack-style to the Detroit-style pizza. We actually had one in New York City the last time we were there. It was fantastic. Emmy squared all the way down in the village.

Now, this began 75 years ago. A local Detroit pizzeria took some discarded steel pans from a car factory and awkwardly decided to bake pizza in them. They figure, why not cook the dough in these chassis? Yeah, and guess what? A rectangular pan in high walls, that is highly conducive to the grisly, crispy, cheesy crust we all enjoy. The key to crispiness? Lots of right angles. Instead of Italian mozzarella, they made another switcheroo.

Detroit pizza uses Wisconsin brick cheese. The Michiganders figured, why not? Let's help our Wisconsin brethren out. Get this. Pizza Hut is jumping into Detroit style. It turns out it's the biggest trend in pizza right now. Right now, only 0.4% of pizzeria menus include Detroit-style pizza, but that is three times higher than just a year ago.

Jack and I saw that stat, and so we had to ask, which regional pizza style should go head to head with Detroit style we thought the snackers would not. Take Brattleboro, Vermont, my hometown, for example. We have circular pies that we cut into. 16 square pieces. What local pizza should win the Pizza Wars? Tell us at Robin Hood Snacks, happy T-Boy Tuesday. Let's in our three stories. You're tuned in the snacks daily. We spoke to the lawyers

and we got to get something legal out the way. The snacks about the hair ain't food. It's air candy. They don't reflect the views of the Robberhood family. It's all informational just so. You know, we're not recommending any securities. It's not a research report or investment advice. Not an offer or sale about security. For our snacks is digestible Business news for you

Rapperher Financial LLZ Member Fenra Slash SIPC For our first story Tesla is adding Bitcoin to its list of accepted currencies This is potentially an historic moment for the mainstreamification

of Bitcoin Now here's the funny thing Snackers You maybe could have seen this news coming after Elon Musk put hashtag Bitcoin in his Twitter bio He wasn't subtle No he wasn't subtle about this

But Jack and I were at the situation, we basically have divided this into two parts. First part, here's what actually happened on Monday. Tesla announced two things. First, it bought one and a half billion dollars worth of Bitcoin. And second, Tesla expects to start accepting Bitcoin for the purchase of cars, in quote, in the near future. Yeah, and as soon as that happened, Bitcoin's price jumped 21% to $47,000 of Bitcoin. We miss you, Ben. If so facto, one Bitcoin is the value of one Tesla model Y. It depends what rims you get, but at a certain point, keep the change. Now, both of those Tesla announcements have happened before from different companies.

Great Point Jack Square, for example, bought up a hefty $50 million worth of Bitcoin just last fall. Oh, and by the way, their stock jumped as a result of this. Wikipedia has been accepting Bitcoin for a while as donations. KFC Canada, apparently more progressive than KFC America, is accepting Bitcoins for chickens. And a couple of years ago, Overstock.com treated themselves to Bitcoin as an accepted currency. But what happened yesterday, Snackers, this was much bigger company with a much bigger investment with much bigger consequences. So the second part of the story, what questions does this big announcement bring up for Tesla? Okay, so first, Jack, can we turn it over to the Tesla PR

announcement, which actually verbalized this whole thing? Here's why Tesla says they did it. To diversify and maximize returns on their cash that is not required to maintain adequate operating liquidity. Jargon, jargon, jargon, jargon, jargon, jargon, jargon, jargon, jargon, jargon, jargon, jargon, jar. Our translation, we have some extra cash and we think Bitcoin is a good investment. Which then leads to this next question, can Tesla handle all this risk with this particular cryptocurrency? Tesla has $18 billion worth of US dollars, and the value of that doesn't move around much. No, but Bitcoin, it leads an active lifestyle. Yeah, if Bitcoin plummet 80% like it did in 2017, Tesla's cash holdings could plummet too, which then leads to this next question,

how is Tesla going to price cars in terms of Bitcoin when everyone's predominantly using dollars? The average price of a Bitcoin in January was about the same value as the price of a Tesla Model 3. Well, Jack, that was only like, I don't know, two weeks ago. But in February, the average price of Bitcoin, that could upgrade you to the model Y. To accept Bitcoin for cars, are they going to constantly update the price of their cars to reflect the very volatile price of a Bitcoin? So Jack, what's the takeaway for our buddies over at Bitcoin? For a currency to become mainstream, it must pass the faith and acceptance tests. So with the U.S. dollar, it has value because people believe it has value. Check the back of your George Washington.

It's backed by the full faith and credit of the United States government. I love those lines, Jack. Now, it has value because you, me, Jack, all of us, and the government believe it has value. Now, on the faith side of Bitcoin, Tesla's CEO, Elon Musk clearly believes in Bitcoin, and more CEOs could follow his lead. Yeah, people who admire Elon or corporate America could start having the faith too in the Bitcoin. Oh, by the way, the price of Bitcoin boomed at the end of last year, thanks to financial and institutional buyers finding the faith in Bitcoin.

Case in point jack, JPMorgan, and a whole bunch of hedge funds. On the acceptance side, two major fintech companies will soon be allowing payment for things in Bitcoin. Case and point, Jack, PayPal and Square. And yesterday, a major corporation announced their planning to accept Bitcoin for their product. Case and point, our buddies over Tesla. Here's our biggest takeaway within a takeaway for the Tesla decision yesterday. Inception takeaway, Jack, I love it. Bitcoin moves closer to the faith and acceptance needed to become a mainstream currency. For our second story, Hershey's profits searched a whopping 42% last quarter. And Hershey's just showed that big food, they can still be nimble. Now, that was a bold kind of beginning line from us.

Hershey's stock, though, really not done much. It's kind of been down in the last year, to be honest. But it's had some impressive numbers in the last three months they just reported on. Yeah, I eat chocolate cake every weekend, so been looking forward to these Hershey's earnings, 6% rise in revenues to $2.2 billion. More impressive, a 42% jump in profits to a respectable half a billion dollars per quarter. We're talking about Pennsylvania-based Hershey's a company that is worth two lifts. This is the pride and joy of American confectionery. It feels like it's time to retire the word confectionery, by the way. This is the Willy Wonka of America. Now, Jack and I were checking out this earnings. Honestly, there was just one thing

that stood out for us that told the entire story. Hershey's figured out that chocolate sales spiked 40 to 50% right after a part of this country had a spike in COVID. Yeah, they found that math, and then they followed this really simple formula. Here's how it goes. COVID spikes, people stay at home, people get hungry and anxious at home, they need wholesome family activity slash indulgence slash distraction at home. And what's better than smores? The OG experiential dessert sandwich. On this earnings call, the head of Hershey's announced that they just had their biggest smores season ever. And it's thanks to Hershey's nimble actions that they recognized in result to local COVID-19 spikes. Basically, Hershey saw where they were stayed home.

mortars rising and then adjusted their entire marketing plan in whatever region that was. If Kansas had a spike in cases, they would build in-store displays emphasizing smores, not Hershey's kisses. In those locations, then people may be doing more online grocery shopping, so they started creating combo packs of all the smores ingredients for online delivery. And then with all branding and all advertising and all marketing, they repositioned smores as a family-friendly, COVID-friendly, outdoor activity, perfect for 2020. Snackers, this was not a Hershey's earnings report. This was a Smoors earnings report.

This is so good, Nick, I need to say something good right now. Well, Jack, how about this? What's the takeaway for our buddies over at Hershey's? Big doesn't have to be slow. No, now, Snackers, Jack and I make fun of General Mills, Kellogg, and, like, big food companies for missing trends all the time on this. Honestly, like half of this podcast is that. That's what we do for a living jazz. Saltine sales fell by 50%. They're going to hire 12 MBAs to fix it.

Jack, Kraft Heinz, like, didn't know what old milk was until that Super Bowl ad yesterday. They haven't been very nimble. Big food, though, does have access to big data. The question is, can you analyze and interpret and find insights from that data? And get this, Snackers, we just noticed that yesterday an investment analyst upgraded Hershey stock because of what they referred to as superior industry insights that Hershey's has. What Hershey's did last year with Smoors is exactly that. It acted on industry insights thanks to the data it had access to. Yeah, Jack and I were looking into it and they devoured a trove of sales data and then moved as fast as like a kid with a pixie stick. Hershey's looked more like a nimble tech startup than a 127-year-old

Pennsylvania-based confectionary company. Big Hershey's used its size to be fast. For our third and final story exactly a year ago. Target launched its own specially branded Athleisure line. Target strategy, pretend it's not Target at all. Now before we jump up to Target, overall apparel sales fell 34% across the whole retail industry last year. Athleteisure though seems to be doing its own thing. Perfect timing because Target launched their own subbrand called All In Motion, an Athleisure brand early last year. In less than a year, we just got this headline, in less than a year, All in motion, Target's Athleisure Line, has already hit a billion dollars in annual sales. All right. How big is a billion dollars? Lulu Lemon does four times that, but it took Lululemon

14 years to get to their first year with a billion dollars of sales. Jack, I like where you're going. Can you sprinkle a little more context on this for us, please? Athleta, which is Gap's version of Lulu Lemon, they got acquired 13 years ago, and it appears they just finally hit a billion dollars of annual sales. Once again, targets All In Motion Athletia brand hit a billion dollars in annual sales in less than a year. And we're big fans of All in Motion. It's basically democratizing access to athletewear. Can we drop these stats on you? All in Motion sold 21 million pounds of dumbbells in 2020. I love your verb choice with drop there. They also sold enough yoga mats to cover 122 football field. Plus, they're democratizing with more inclusive sizes. So they like start with size XS, but go all the way

up to 4X. Now, while Lulu Lemon is charging three digits for yoga pants, yes they are. The average yoga pants at All In Motion is $30. So you're going to opt for the All in Motion pants instead of dropping $90 on the Athleta Piriweight Body Suit. And despite those lower prices, All in Motion is the profitiest of profit puppies for Target. Okay, we got some simple math for you here, Snackers. Apparel is more profitable than food. It is extra profitable when you own the brand making the apparel. And that's because the profit is all yours when it's an own brand. Nobody does share the profits with like those suppliers. So Jack, ignoring those suppliers, what's the takeaway for our buddies over at all in motion

and Target? Target's winning strategy is to ignore Target and it is working. There are no products at Target that are branded Target, it appears. Yeah, instead, Target uses 45 owned brands, not one owned brand. No. 45 own brands are for sale at Target. This isn't like Costco with Kirkland brand, and that's it. They got 45 Kirkland brands. Now, these owned brands, that's what Target calls them. They are owned by Target. They're made and

produced by Target. They're sold at Target, but the Target logo is nowhere to be seen. Okay, Jack, these numbers were insane. Four of those own brands by Target are doing $2 billion in annual sales. Ten of those own brands are doing a billion dollars in annual sales. Okay, and then in addition to these 45 own Target brands, Target is welcoming other brands. into their stores with stores within stores, Inception retail. There's a Disney store. There's a Levi's store. There's Alta. There's Casper mattresses. There's Harry's Razors all within Target superstars. That target, ignoring target strategy, and maybe the best thing that's ever happened to Target.

Jack, can you whip up the takeaways for us over there? Tesla wanted to diversify its cash beyond U.S. dollar, beyond Euro, beyond Chinese Yuan. Bitcoin, it's one step closer to passing the faith and acceptance test. Hershey's capitalized. on America's need for COVID-friendly family funds. Smores, they show bake, doesn't mean slow. For our third and final story, the fittest of Target's own brands is all in motion, which just did a billion dollars in annual sales.

Yeah, Jack, targets, target strategy here appears to just be to totally miss the target. No target at all. Now, time for our snack fact of the day. This one sent in by Barbara Martin in Boston, Massachusetts. Barbara, we'll turn it over to you. In 1997, Mabel Fairbanks was the first African-American inductive. into the U.S. figure skating Hall of Fame. During her career, she encountered numerous barriers as an African American who desperately wanted to skate in an all-white skating world. Eventually,

she found herself as a dynamic professional skater for ice capades, and later a coach who opened doors for countless minority skaters during her Hall of Fame career. She often told her students, you should suffer for your art, which seemingly she most certainly did. Mabel Fairbanks overcame insane adversity. She was, was also orphaned at the age of eight when her mother died. Also, Jack, I learned to skate like in Central Park. She learned to skate in the six-by-six-foot rink that her father built in an apartment building. Mabel Fairbanks, you are incredible. Although I would have loved an apartment ring. That's pretty cool. Snackers, send us your audio snack fact with the

Google form that's in the notes of this episode. And remember to share your snacks, ask your friends, H-Y-H-Y-S-D. Have you had your snacks daily and happy Black History Month? We'll see you Tomorrow. This is Jack, Nick owned stock of Square and Lulu Lemon. No more Ben the Bitcoin. He's gone. Although he's doing better in the afterlife. He's doing bad. This is the best thing that ever happened to Ben. And before we go, Snackers, congrats to Eugenio Zubietta, who is having a baby in Monterey, Mexico. Happy birthday to Takashi in Tokyo, Japan, and Nicole Adams in Lake Tahoe. And C.J. Eng in Philadelphia. And Aaron Nehu in New York City. And Katie Fowler, happy 37th in Atlanta, Georgia. And Kyle Chance in Milford, Ohio.

Ellie, happy birthday. Welcome to Boston. And Clinton Hirano over in Hawaii. And El Deer Lopez in Los Angeles. And Baby Olivia joined one week old in Santa Clarita, California. Congratulations, baby Olivia and her parents. And Linus, the Australian Shepherd Dog, just turned five in Berkeley. Nat too shabby.

Zach and Camille, happy engagement in Alexandria, Virginia. Jack, making a double wedding. Melanie and Tyler also just got engaged down in the Woodlands, Texas. And finally, happy. birthday to Dr. Ben Zorak from Wilmington, Delaware. Paging Dr. Zeman. Paging Dr. Zeman. The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robinhood

Markets, Inc. or any of its subsidiaries or affiliates. The podcast is for informational purposes only and is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. The podcast is also not a research report. and is not intended to serve as the basis of any investment decision. Robin Hood Financial LLC, member FINRA, SIPC.