The Best One Yet - “Crocs won 2020” — Crocs’ 400% gain. Nestle’s $1B meal(kit). Exxon’s slow burn.

Episode Date: November 3, 2020

First of all, have you voted yet? No? Stop the show (we’ll wait)... Nestle just dropped $1B to buy Freshly because it’s a learn-cquisition. Crocs just whipped up a Justin Bieber collaboration as its stock enjoys a 400% run since March. And for the first time ever, Exxon suffered its 3rd straight quarterly loss.$CROX $XOM $NSRGYGot a SnackFact? Tweet it @RobinhoodSnacks @TBOYJack @NickOfNewYorkWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Learn 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, November 3rd. Snackers. Yep. Have you voted yet? Jack, women out the old H, Y, H.Y, H.Y.B.

No, just H.Y.V. Have you voted? Have you? If the answer is no, by the way, stop the pod, Jack. Stop the pod. We're going to give you a little time. Yep. Grab a number two pencil. Grab a black pen and fill in that oval completely while you visit your polling station. In the meantime, this happens to be the best podcast we've ever done. For our first story for this T-boy, Nestle just dropped a billion dollars on meal maker startup freshly. Jack, can we make Kit Kat Meal Kit's a thing already? Is Kit Kat Nestle Nick?

Jack, if there's a cocoa in there, it probably got touched by Nestle. For our second story, ExxonMobil just had its first ever three-quarter losing streak. Honestly, this oil giant is due for some relegation. You know what we're talking about. Somebody's been watching a little Ted Lassa. Goes out to our European Snackers, third and final story, Jack. Crox stock has surged a casual 400% since March. Early takeaway here?

Function hates fashion. Comfy beats cuteness. We ran out of alliterations. But Snackers, before we hit those three stories, let's take another stroll down Freedom Lane. Remember yesterday? Our chat about the U.S. Constitution. Jack, I remember a well. It feels like it was just yesterday.

One peculiar thing about the U.S. Constitution is that power is distributed, not just in D.C. No, it goes out to each of the 50 states as well. we're talking Albany and Montpelier, they got some power to. For example, education, the Department of Motor Vehicles, law enforcement, they're all handled by states and local governments. Well, it turns out that voting was also left to each of the states to decide how they're going to handle it. We got 50 different states, and we got 50 different state election rules. From 13 original colonies. I don't know what that song is. I didn't learn it in school. If you know, you know in middle school. But Nick and I are thinking, it's kind of like your favorite drinking game. Yes, there's

different rule tweaks at every college campus. For example, you don't drink the cup until the game's over, or do you drink the cup right away? At Providence, there's no bounces. At Brown, there's no rewrax. At Michigan, there's no rebuttals. At Middlebury College, extra rebuttals. Nick, I got to ask, are you planning to take a selfie in the voting booth today? Jack, it's a great question, because it depends on which state I actually voted in. That is correct, Mr. Martell. Only 24 states allow selfies in the voting booth in these United States. That selfie could end up with a little bit of a voter problem situation legally. Now, the reason we're bringing this up is today is Election Day. And in Florida, because of hurricanes, Florida has lots of experience with early voting. Yes, it was early votes

have been coming in. They've been counting those early votes. So we'll probably know tonight who's going to win Florida because all the votes will be counted. Meanwhile, up north in Pennsylvania, they don't have as many hurricanes. They don't have as much experience with early voting. It's just not what they do in the Keystone State. And state election rules in Pennsylvania dictate that those early votes, they can't be opened until today, election day. So over in Pennsylvania, they got millions of envelopes that are piling up. They're just about to jump into. Pennsylvania's Secretary of State, he said they have so many envelopes that you need to open up and count ballots. How many do they have? Millions back. They probably won't be done counting until Friday in Pennsylvania. So Jack,

what is the takeaway for our entire electoral process? This isn't a normal election. No, Snackers. According to reports, the president actually plans to declare victory if he has a lead, regardless of the number of votes counted. But that is not how elections work, and that's especially not how this election works. The election is decided once all the votes are counted. I'm going to whip things back to 1787 in Philadelphia with our buddy Ben Franklin. Big fan of the cheese steak, big fan of democracy. He said America is a republic if you can keep it. It's our responsibility to ensure that every vote gets counted to keep it.

keep that republic. So snackers vote today, have patience with the outcome, and then tell a friend to vote today. Happy election day. Spread your vote. You're tuned in to snacks daily. We spoke to the lawyers and we got to get something legal out the way. The snacks about to hear ain't food. It's air 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 of a security. Right. Snacks is digestible. Business. news for you. Rob her financial LLC. Member Fenra

slash SIPC. For our first story, Crox just whipped up its biggest collaboration ever with Mr. Bieber. The Beebbs! And Crocs is a stock winner of the coronavirus. Which means Jack and I, we miss something here. I mean, we have to apologize to Snackers.

I know. We didn't wish everyone Happy Croctober. Happy Croctober. That is just good, clean, family corporate fund. You know, the annual harvest of the rubber sold. This was a Crocs promotion and it led to a stat that has blown Nick and me away. Jack and I saw this. We had to stand up, sit back down and stand up again. We said we're going to do the whole story based on this stat. Get this. In 2020, this year, overall U.S. footwear sales are down by 20%. But over at Crocs,

crocs sales are up 48% this year. That is called outperformance. That's called leading the pack. That is a hero stat. Now, Snackers, all this goes back to 2018, when Crocs developed its number one growth strategy. The art of the exclusive collab. Like all great collapse, it begins with someone with tattoos. Begin with a rapper named Post Malone, 2018. Then a country singer named Luke Combs, then Korean star who did Gangnam style, PSY, then Grateful Dead. And then the actress Drew Barrymore got involved.

And then the poultry icon, KFC, got involved. They all got Crox collaborations. You get a Crox collab. You get a crox clap. You get a crox clap. And the Oprah's the only one who didn't get one ironically. But then three weeks ago, Crocs kicked things up a notch. With their biggest collaboration yet, we're talking the Beaves.

Justin Bieber. Sorry, Birkenstock, I'm going with Crocs. Yellow Crocs, all with the Beber look. Plus, they came with six charms you can remove or trade. Then last week, Crocs cooked it up another notch, Bad Bunny of Puerto Rican Raggedon King. His Crox exclusive collaboration sold out in 16 minutes. Yeah, because you wear your brief.

Bebes Crocs during the day, but then his glow at night, so you'll wear those at night from the bunny. Now, the average crocs, and I can speak from experience because I have a pair, they go for about 50 bucks, but these exclusive clubs, Nick, they're big. They're going for eight times that on secondary shoe websites. I feel like this is a good time for your full disclosure, Jack. I also have broken stocks. The two ugliest shoes on the market. Yeah, thank you, thank you, thank you. Now, Jack and I are looking at this situation over Crocs, and we're realizing Crocs caught itself on a microtron. over fashion. Because I can tell you from experience, Birkenstocks and Crocs, they're like a, you know,

a 10-hour long massage for the soles of your feet. Jack usually wears those shoes. He's apologizing for wearing them half the time. He's wearing them, but he's still wearing them and he's happy. Now, we call this function over fashion a micro trend because we're not sure it'll live past the pandemic when we have to see people again. Yeah, electric cars will probably be driving those in 10 years. Wearing Crocs? Yeah. But during the pandemic, The slogan of Crocs, come as you are, it's working really well because it basically says,

no one cares how you look, just worry how you feel. In the meantime, it's working in every part of the world. Over in hospitals, nurses are wearing crocs because they need washable shoes right now. Over wherever you live, you need Crocs because you need a porch-to-potty slip-on option that doesn't require a lisa. The old P-to-P, man, the original P-to-P, we're looking at you then, though. That's why Crocs just announced a record third quarter. Profits nearly doubled and sales hit a record high. Oh, by the way, Snackers, look a little further. Crox stock has quintupled since March. It's up over 400%.

Crocs is the first pure play ugly shoe company on the market. It is, except for we also got Skechers in there, which means me at an ugly shoe ETF situation, Jack. Ticker symbol, ugly. Boom, U-G-L-Y. So, Jack, what's the takeaway for our buddies over at Crocs? In the fashion industry right now, every trend that wasn't cool has become cool.

Yes, Snaggers, Jack and I have noticed that the fashion industry is going through a bit of an anti-fashion movement specifically because of COVID. Fashion used to beat function. Yep. Now, Crox is showing us it doesn't beat function. Function is beating fashion. Secondhand has become like the coolest thing there is. Yeah, second-hand startups like Threat Up or IPOing.

The Real Real already publicly traded and it's a second-hand stock. And Levi's just launched their own second-hand side. True. And then third and final fashion trend that's been turned on its headjack. Nostalgia. Nostalgia's new again. It's new again. Look at Nike.

their Air Force One is the most purchased shoe of 2020. The mega trend for fashion stocks right now? Anything anti-fashion. For our second story, ExxonMobil just notched its third straight loss for the first time ever. Bad Hatrick. Exxon stock is getting sent down to the miners. Yeah, it is. Jack, to quote our buddies over at The Karate Kid, Ex-on, X-Off.

That's actually quoting the Sensei. Yes. Of the Karate Kid. Good correction. But we're going to have to travel back nearly a century. in 1928 to really tell the story of ExxonMobil. Standard Oil Company was owned by John D. Rockefeller, the world's first billionaire with a big.

Now we're going to fast forward 100 years. They did a bunch of split-ups. The monopoly got broken apart. Then you got Exxon and Mobile who end up merging, ipso facto ExxonMobile, the company. That's right. Go way up ExxonMobil's family tree, and you get John D. Rockefeller,

the world's first human unicorn. You would love that image. Now, profit puppies when it comes to ExxonMobil, just one. That's all they need. Just one. Oil. Yep, that was it. And then they happened to own every single part of the value chain related to oil. They extracted oil and gas from the earth. They refined it, and then they sold it. They even had a retail chain across the country. Yeah, it doesn't stop at selling the gas.

They're also selling you all the snacks, right, Jack? You get a free coffee with every 10-gallon-fellip at participating Exxon Mobil stations. Boom, Kaching, that's how they roll. And they just announced to Exxon Mobil third quarter earnings, or lack thereof. Oh, that one's going to hurt, Jack. Now, that's because ExxonMobil lost $680 million in the last three months compared to get this, a $3 billion profit last year. It's also, unfortunately, cutting 14,000 jobs because business isn't good. That's 15% of their global workforce.

So you're looking at Exxon Mobil. It seems like it's kind of fallen from grace, which makes us think we kind of wish all stocks were European soccer. If they were, Exxon would be due for relegation. There also would be a lot of people running around painting their bodies on the New York Stock Exchange, which may be a good thing. There should be stock hooligans. There should be stock hooligans. I think there are stock hooligans. There are stock hooligans. In 2013, ExxonMobil for perspective was the most valuable company in the world, aka on the S&P 500, the scoreboard of America's most valuable public companies. Now, since then, ExxonMobil has stubbornly clung to fossil fuels, despite society moving in a different

direction. Yeah, they're doing next to nothing to transition to clean energy, unlike some of their peers in the oil and gas industry. The cleanest thing Exxon does is those squeegies to let you clean your windshield at the gas station. Those aren't totally clean. They're not totally clean over there. And it's also dropped way down the scoreboard of biggest, most valuable companies in the world. Yeah, Exxon Mobil has dropped from the number one most valuable company in the S&P 500 in 2013 to number 43 as of yesterday. Also, Exxon Mobil used to be the answer. to some of next my favorite finance trivia questions. Oh my God, call it a Saturday night because this is what we whip up in front of the fire.

Jack, what are the only four companies with AAA credit ratings? Used to be ExxonMobil. Jack, what company's been on the Dow Jones Industrial Average, the longest? Used to be ExxonMobil. Jack, what is the only gas station chain that named their store after an animal? Still ExxonMobil? Tiger Mart, so Jack, what's the takeaway for our buddies over at ExxonMobil? The economy used to run on oil.

Yep. Now it runs on the cloud. Snackers extracting oil and then refining it to gasoline, that is hard. You got oil rigs. You got a bunch of danger. You might be in the middle of the ocean. There are wolves next. There are wolves trying to like eat the workers.

Plenty of wolf sighting. And it's really hard to clean off yourself if it gets some oil on your suit. Have you seen those Lysol ads with the duck? They've like six people working on a single duck. But ExxonMobil's business was also extraordinarily simple if you think about it. Here's how it went down. As the economy grows, fuel it with more fuel. Fuel it with fuel. But today, yeah, the economy doesn't need oil as much as it used to. It's moved to a digital diet. Completely different diet, and that diet is cloud computing. That's replaced oil as the most valuable commodity to grow an economy.

Amazon Web Services, not petroleum, is what powers growth of the economy today. Gig and bytes, not gasoline and barrels. That's why Apple, Google, Amazon, and Microsoft have taken X on throne as the most valuable companies in the S&P 500. Because the cloud has taken oil's place as the most valuable commodity. America runs on not Dunkin' Donuts at the cloud. Sorry, Dalene! For our third and final story, Nestle, just acquired healthy meal startup freshly for about a billion dollars.

And then it promptly ruled out the biggest potential benefit of this acquisition. It totally did. Now, the Swiss food giant Nestle, its stock is publicly traded, by the way. Jack and I noticed it's got a thing for prefixes. Hot pockets. Yep. San Pellegrino. Check. And anything that begins with a Ness.

Jack, I'm looking at a, I got an espresso, Ness tea, Ness Cafe. Am I forgetting one? What else we got here? I don't know, but it's got a prefix and it's got a suffix. Ness Quick, baby. That was it. The news from Friday. Nestle is acquiring Freshly, a meal kit company that thinks Blue Apron is too much work. Freshly, it's based in New York City.

It's perfect for when the line at Zabars or Fairway is just too long. a Sunday night. Imagine a Blue Apron meal kit. We've all got the free samples and they quit before the subscription starts. You have to mix in coriander with soy sauce. You got to sear it twice and then like bake it three times and then maybe eventually you can eat. Oh, I'm sorry. I'm not done the meal yet. I have to channel my inner Bobby Flet. Freshly's meals on the other hand require barely any prep. Ravioli, microwave, toss in a pan, eat colder hot, done. The most you're going to have to do is like drizzle on some walnuts. In the meantime snackers, Jack and I jumped in snack style. sense of Freshly's numbers, and they're shipping out a million meals a week, expecting $430 million

in sales this year. Now, our first thought with this acquisition, it makes sense. Yeah. Instead of Freshly having to pay top dollar for its ingredients, Freshly can use Nestle's ingredients instead. Boom, Freshly would vertically integrate its meal kit supply chain with Nestle's reducing costs, increasing profits, everyone's happy. Basically going to pull a John D. Rockefeller and verticalize this whole thing.

Jack, we found ourselves the Exxon Mobil of meal food things. Wrong. In a press release, Freshly came out straight out and they're like, our meals will not be changing, actually. Yeah, get this line from them. No plans to change ingredients or integrate Nestle's products into freshly meals. Sounds like Nestle's like offended by Freshly. Yeah, they're like going out of their way to say they had no relationship with Joan Orion. We're not with them. That's a total page six thing. We have no idea what they're talking about. Now, for an acquisition to be successful, there must be synergies in that acquisition. The S word synergies. You got to see them. Basically, why is a lot? freshly more profitable as part of Nestle than it is standalone. If it's not more profitable as part of

Nestle, you shouldn't do this acquisition. So Jack and I are looking for synergies. And the first place we look is to, does this deal cut costs? No. The press release flat out ruled out that possibility. All right. So costs are out to Jack and I keep searching. Is the synergy potentially in optimizing revenues? Maybe. Freshly said it'll triple the number of menu items thanks to this acquisition from Nestling. Well, Nestle then will have to pay for that menu expansion since they're buying freshly. And there's no sign they're going to be sticking in Nestle's Kit Cap bars in with the freshly garlic butter baked salmon. No, so it's still not clear to us how this boost profits over at freshly. We're still trying to figure it out.

So Jack and I then decided to go to the takeaway. So Jack, what's the takeaway for our buddies over at Nestle? We think this is a learnquisition. Snackers, some people read books to learn. Some people listen to podcasts and others buy entire companies. Case in point Walmart. Check. It went on a buying spree starting in 2016 of entire company. Jet.com, bonobos, modcloth, all acquired by Walmart. If you're venture-backed, tech focus, direct-to-consumer, and only used lowercase font in your logo? Yes. Walmart was interested. Oh, yes, it's interesting.

And Walmart ended up killing off jet.com. And bonobos, the other, you know, the men's khaki company had acquired, it's not thriving right now. You said it like you don't know bonobos. Yeah, guilty. I know. Snackers, with each of those acquisitions, Walmart learned all of Jet and Bonobo's e-commerce tricks and then kind of moved on. And years later, it's now putting that learning to action on Walmart.com with great e-commerce and curbside pickup, which has been highly lauded during the pandemic. So everything modern about Walmart today, you can trace back to those acquisitions

half a decade ago. So we think Nestle's executives, they're going to read every single page of the freshly meal kit textbook. And then they're going to apply its learnings to the rest of the Nestle Food Empire without ever putting Nestle's products inside a single freshly dish. Probably, that's what we think. Jack, can you whip up the takeaways for us over there? Crocs is winning because cuteness comes second to comfort during the pandemic.

It's one of the many anti-fashion trends of fashion right now. For a second story, Exxon Mobil stock is due for relegation stat. The economy runs on the cloud, not on oil anymore. For our third and final story, Nestle has acquired freshly even though freshly seems to want nothing to do with Nestle's products. I was like, Nestle's just hungry for a learned acquisition. Classic, Nestle. Now, time for our snack fact of the day.

This one's sent in by Hannah over in lovely Beirut, Lebanon. All right, way back in 1758, when George Washington was running for the House of Burgess. Yes. In the colony of Virginia. Yes, he was. He had himself a budget, didn't he, Jack? He had himself a campaign budget, most of which he spent on booze to sloth. to solicit votes from potential voters.

It wasn't uncommon for elections during that time period, but they still went kind of hard. They procured 160 gallons of alcohol and handed it out for free to the 391 voters in the county. Jack, the results please, the envelope? Unsurprisingly, George Washington won with more than 39% of the vote. We'll leave it at that. Snackers.

Don't H-Y-H-Y-S-D today. Instead, the O-T-E. Stand in line, call the phone. friend, tell them to get out there with you and spread your vote. Happy Democracy Day. We'll see you tomorrow. We can't wait. This is Jack. I own stock of Amazon and Levi's and Nick owned stock of Apple. 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.