The Best One Yet - American Airlines’ rough 5 years, Bed Bath & Beyond’s innovative new CEO, and Lithium Ion Batteries’ big week

Episode Date: October 10, 2019

Bed Bath & Beyond stock is down over 80% in the last 5 years, but it just snagged a new CEO who revolutionized shopping at Target. Compared to Delta, it’s been hard out there for American Airlines, so we’re looking at what uniquely caused its problems. And our Invention of the Day is lithium ion batteries because the creation that enabled the tech device you’re reading this on just won a Nobel prize.Learn 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 Thursday, October 10th. I know what you're thinking. 10. 10. Yep. T-boy.

Jack has been waiting to say this. Pretty much all year, actually. First story is bed, bath, and beyond. It's got a new CEO. Turns out it's a Target guy. Nice little Saturday. Jack, I don't know if we're going to have enough time. Second story.

American Airlines has had a really rough five years. So we're doing what you do anytime you book a flight. Compare. Comparison. Airlines. Comparison shopping. American versus Delta. We're going to spare you guys like the time.

turbulence jokes on this one. Third and final story is an invention for this podcast. Are we doing, is this new? Is this what is this? The invention of the day. I didn't know about this. What's going on here? Lithium ion batteries. Boom. A.k.a. The super battery. Did they just win an award? Three very old chemists just won a very old award in three million crooner. Are we talking Nobel Prize? Nobel Prize. You ever heard of it? Snackers, a lot of snacks related companies involved in this. Now, Snackers. We also heard a lot of even listening to snacks late at night. Maybe you're not getting your sleep like you should be. People are listening late at night? Apparently, not just in the mornings.

Weird. Well, if you need help falling asleep, we're going to let you in on a little secret. We got this trick that we learned that works 96% of the time. Every time. Not really our trick. It was actually a trick invented by the military in World War II. Yeah.

To make sure that people got enough sleep so that they didn't fall asleep during, like, battle. If you're in that fighter jet, you got to be as accurate as possible, like most of the time. So there's actually a five-step process. Okay. I've used it. Snacker, I recommend you focus on numbers two and three

because one, four, and five are kind of obvious. I'm going to kick this off and start off with number one? Number one. Find a comfortable position. Okay, you can lean back, find something soft. Just start lying down. Number two, this one's crucial. Relax your face. Your face has apparently 43 muscles in it. You got to get every one of them relaxed. If you think your face is relaxed, you're not. Nope. There's probably a couple that are tense. Is your face relaxed? Relax the jaw. What about right now? Number three, this one's crucial too. Drop your shoulders. Okay, let them go. Starts at the shoulders, goes to the biceps down to the forearms. Get the shoulders as far away from the ears as you can. I'm slipping away right now.

All right, now four and five, let your legs go limp. Okay, this is going to be, all right, you're going glutes all the way down to the calves. I can barely feel anything right now. All right. Now, number five, turn off your brain. No new thoughts. Let's hear of three stars. Let's do this.

All right. You're tuned in the snacks daily. Snacks about to hear ain't food. It's ear candy. They don't reflect the views of the robberhood family. It's all informational just so. We're not recommending any securities. It's not a research.

report or investment advice. Not an offer or sale about security. Right. Snacks is digestible. Business news for you. Robberhood Financial, LLC, member Fenra slash SIPC. For our first story, Bed Bath & Beyond has a new CEO. So we're looking at his playbook.

Mark Triton. Congratulations, Mark. New president and CEO, Australian, starts November 4th at Bedbath and Beyond. Somebody send this guy some cake. He's going from C-suite to C-suite. He used to be the chief merchandising officer. Target. Is that a horizontal move? No, that's vertical. It's still up. Yeah, it's diagonal. Jack and I got curious here. So the first thing we did is jump in Snacks down and

look what Target's been up to and look at what Bed Bath and Beyond's been up. Target's stock has been crushing it. It's up 80% in the past five years. Bed Bath and Beyond stock is down about a little over 80% in the last five years. That's a mirror situation. One up, one down. However, when they announced this news of the new CEO yesterday, best day ever. Not too shabby bedbath. It's stock jumped 21% on news. It's getting a new leader. And that's because it started out like kind of at a low point. It's been a rough year for bed bath and beyond. We're going to just completely ignore any beyond, like, puns here. It just announced last week it's shutting down 60 stores. It's also had 10 straight

quarters of falling sales. That's horrible. That's not fun. That's two and a half years. Yeah, I like that calculation. And the co-founders recently retired from the board. We think they were kind of pressured out from the investors who are just really upset about that 84% stock drop. We wanted to say flushed out, but we'll go with that. Now, all the talk about retail innovation is focused on websites online. These sales, those sales. You got Amazon.com, people want their own. However, what makes Mark the new CEO stand out for Bedbath and Beyond is that he's a case study in offline retail success. First of all, yes. Digitally native brands. Sound jargony? Mark is the whisperer of these brands. So true. We're talking like the millennial direct-to-consumer favorites. You can only get online and you can only

get on that company's website. We've accept, there's one exception to that. I know what you're thinking. Targe. Very true. Harry's, Casper, Barkbox, Quip, these are all direct-to-consumer websites that also have little spots within Target. And the reason why is because Target's come to them and said, hey, you were only selling these fancy toothbrushes or these blow-up random mattress situations on your own website. Why don't you sell them at our chain, which gives you massive scale and audience? So Target got a little buzziness, got people in the stores, and those brands, they got new customers. That was Mark's leadership. Maybe the same thing can happen now at Bed Bath and Beyond. So interesting thing that Mark also did his target is he looked at all those

brands like Harry's Razors and Casper mattresses and said, hey, those brands are succeeding with a playbook here. I think I'm going to adapt it. So he did with private labels. These are companies and products that are owned by Target, but disguised as like totally different, unrelated companies. Completely trigger treat situation. Who's under that hood? I have no idea. Actually, it's Target the whole time. First, I want to talk about Everspring, which is a sustainable cleaning product company? Kind of like seventh generation we talked about. It's actually owned by Target.

Yes, you would have no idea if you looked at these products, that they're actually target products. There's not a single capital letter in the name. They're keeping things as millennially as possible. Okay, another one's Sun Squad, one word. Two capital S is now. Outdoor furniture pool floats. They're selling like the unicorn floats that if you don't have a

picture on, what are you doing with your life? Yeah, there's a good donut, you know, with the classic. Pink frosting. Very bright. We should get one for the office here. And then Goodfellow is a men's apparel company. They just spun off a personal care line. It's actually going to have a billion dollars of sales by next year.

All those brands we just mentioned, you're going to look at them and be like, oh, that's probably backed by some Silicon Valley company. No, not the case. Owned by Target and Target takes all the profits related to all the sales of those companies. So, Jack, what's the takeaway for our buddies over Bed Bath and Beyond? To see where the company's going, look at what Mark Tritton did at Target. Leadership changes like this, they aren't just leadership changes of people. People represent strategies. This is a change of strategy, and it comes with the person.

Bed Bath & Beyond has a new person and a new strategy. Now. For our second story, American Airlines had an awful summer. It's having a bad fall, and it's been a bumpy five years. Not all airlines are created. Ladies and gentlemen, put away your laptops and trade tables. So the news, the 737 max by Boeing, the disaster of an airplane. Not a fun plane. It's going to be back in service on January 16th for American Airlines. That's after 10 months of it being grounded. They were like using the airport parking lots, I think, to put these things on. They were. We looked at Americans' stock price because of this, and we noticed something. We noticed that it was getting crushed by Delta.

We're going to do another stock scoreboard situation. What happened over the last year, Jack? In the past 12 months, Delta stock is up by 3%. American Airlines is down 16. I've got a feeling that the five-year situation here is even worse. Delta's up 63% in the last half decade. American is up just 1%. So, of course, this begs the question. Why is American Airlines losing to Delta so badly? Turns out there's a lot of reasons making this alarm go off. Is it like American Airlines walk through the TSA security gate with like three bottles of water and two sets of shoes on?

A lot of violations here. Beep, beep, sir, you're going to have to come over here. First one is bad, straight up bad luck for American Airlines. American Airlines owned 24 of those 737 max planes made by Boeing that had a problem. And Delta didn't own any. So they got super lucky here. The second issue here is straight up poor performance. The FAA reports that American had more canceled flood.

in July than any other airline caused by actually a labor dispute with the mechanics. Yeah, they didn't want to be working on the planes. But you need mechanics. Pretty critical there. I actually think there should be mechanic on every plane. Now, those first two items, they've resulted in low morale among the flight attendants. Right, because the flight attendants are like the first line of defense on this thing. So when you walk on, there are no peanuts and you're already angry because it's delayed 30 minutes because of a whip or changers off. Yeah. Yeah. So the first line of defense, flight attempts, they're constantly apologizing to annoyed passengers. They ran out of bananas by the time they got the row 23. Let's also talk about a

big missed opportunity. That's fresh news. This is point number four. Delta just invested into 20% of Latam Airlines, the biggest airline of Latin America. But American Airlines had a 20-year relationship with Latam Airlines. This should have been their partnership. And now it basically got broken up with. And then the fifth and one of the more damning issues. This is a long-lasting issue. Debt. Exactly. It acquired U.S. Airways in 2015. U.S. Airways used to be the fifth big U.S. airline. That means that American Airlines is paying off all those IOUs that U.S. Airways had picked up along the way. It's a lot of interest payments and it eats into profitability. So, Jack, what's the takeaway for our buddies over to American Airlines? Individual companies can

stand out among the peers. Whenever you're talking about markets, you typically hear this. Something changed so an entire industry was effective. You hear it a lot. For example, oil prices fell. All airline stocks rise because they use a lot of oil. Or Boeing 737, jet crisis, all airline stocks fall because a bunch of the airlines use that plane. But individual stocks can move differently than their peers because of performance by the managers, by the policies, and by the partnerships. It's the people who make the business. Also, there's a lot of luck along the way. For our third and final story, we don't have the unicorn of the day. No. We have the invention

of the day. Lithium ion batteries. The super battery just had a big week. Before the super battery, was those huge camcorder batteries. They were the size of my face. Dad's love to get a workout and take video of the kids. Honey, I got to change the camera battery. Can you spot me over here? I have a bad back. All right.

So three chemists got the Nobel Prize this week. Congratulations. John Be Good Enough of UT Austin. M. Stanley Whittingham, great name of Binghamton University in upstate New York. A Kirah Yoshino of Major University. Now, they each get three million Swedish cron. And we know what you're thinking here. Is that good?

I think it's like, it's basically a... a million dollars between the thread. It's a million dollars and they're splitting the million dollars. So what did they do? They develop the new cathode. We don't know what that is. We do not have any physical science experience or expertise. Sounds complicated, but it does sound important. The Nobel Academy says these three guys, they laid the foundation of a wireless, fossil fuel-free society and are the greatest benefit to humankind. Bold statement, that last part may have been a translation issue. Yeah, we wonder if the Swedish to English to situation. But in the meantime, what's most important here, we have portable tech devices

basically because of these three people. Look at the devices near you right now. They probably have lithium ion batters. You are probably inches away from one right now because you're using it on whatever the hell you're listening to us on. It was a huge upgrade from the previous tech because it's lighter. You can recharge these batteries a million times and they're still fine. Very nice. They have way more energy than the old school recharge of the batteries. They're super intense over here. Also, they don't explode. That is so key. Always forget if it explodes, that's an issue. Hold rechargeable batteries used to overheat, ignite, sometimes explode. Also, Jack and I thought this was pretty important.

Whenever we're talking about companies on snacks, a lot of the core products we discuss with you guys every day are running on exactly this product. Lithium batteries are classic enablers. Windows PCs. The first generation, all use lithium ion. Pump that battery up a little bit more. Tesla cars. Tesla, without a lithium ion battery, you'd have to plug your Tesla in, have a really long

extension cord to drive that thing around. If you're not in a three-mile radius, I can't. go to you. The iPhone, the Apple Watch, both lithium ion. Also renewable energy, critical relationship with lithium ion or batteries. Wind turbines and solar panels, they generate electricity. Very nice. But you might not need the electricity right there. Batteries allow you to store it. And it really gives us the chance to have fossil fuel-free electricity. So Jack, what's the takeaway for our buddies who are making these lithium ion batteries? Who got paid for all this? That is the key question here. Tech is often developed on universities and then licensed to the private sector. Or it's developed by governments. Or it's just

developed in-house by a company and they make profits by having a patent. But here's a key quote from one of the winners. John Goodenough. Everything I've ever done, the lawyers end up with all the money. Brutal. I think he was kidding. So true. We actually read the text. We didn't. I don't think he was kidding. He developed the technology in 1985, but he declined to patent it. It ended up getting commercialized by Sony and his fellow winner, Mr. Yoshino. In 1991. And that, and that That was a hit for Sony. Sony ended up using, remember the Walkman? Yeah, the video camcorder we talked about earlier.

It's first generation of laptops that were like the size of cows. All of them had Sony lithium ion batteries. Now, since then, there have been like a bunch of copycats out there, and it's not a technology controlled by a single company. But it's used by everyone, everyone. And it kind of matters who end up getting paid. Jack, can you whip up the takeaways for us over there? Gladly.

Thank you. Beth Bath and Beyond shareholders are thrilled that they got a guy from Target. Expects some well-branded private label. brands to hit bed, bath, and beyond stores and look like kind of entropy. I'm thinking natural deodorant. Already there. Already there. American Airlines stock price is delayed.

ETA for takeoff? Unclear. Individual poor performance and some bad luck or why the stock's down. Third and final story, the lithium ion battery enabled the development of all the tech gadgets that we use. Three inventors got the Nobel Prize for it, not necessarily paid for it. Snackers, time for our snack fact of the day. A great one sent in by Amr Kahale.

From Damascus, Syria. Nick, you know the numbers that we use? Like 1, 2, 3, 4, 5, 6, 7, 8, 9? 9. Yeah, those are called the Arabic numerals because they were originated in North Africa when they were used by Arab mathematicians. I got my map out over here,

scoping the whole thing out. It was only in 1,100 when an Italian named Fibonacci ever heard of them. Discovered these numerals and was like, wow, math, I need to bring this to Western society. To make it more confusing, numbers that are used in the Arabic language right now, They're not the Arabic numerals.

No, they were developed in India and are known as Indian numerals. So you park in a driveway and you drive in a parkway kind of a situation. That's good. Snackers, thank you for snacking. Growth is crucial for us. We love it. So if you could tell your buddies about snacks daily. We love you guys.

Yeah, there's easy share a button right there in Spotify. Easy share a button in Apple Podcast. Just standing in line, you're getting this out. Share snacks. Post it to your Twitter. Post it to your email chain. We love you guys. Talk to you tomorrow.

Let's do it. This is Jack, Nick and I own stock of Tesla and I own stock of Amazon. 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 Robin Hood Markets, 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.