The Best One Yet - 🥫 “Frankly this is a trend that many did not think was possible” — Campbell Soup’s shocking rebound. United Health pops 11%. H&M’s supply biz.

Episode Date: March 5, 2020

Campbell Soup shares jumped 9% because even the CEO was shocked that soup is making a comeback. United Health didn’t announce earnings or a new product — the stock popped 11% because of Super Tuesday (it’s all about policy risk). And you know H&M for whipping up fast fashion, but its latest business line wants rivals to love its supply chain.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. This is Snacks Daily. It is Thursday. It is Thursday. Welcome back to Thursday. Sounds like the birthday boy. Signed to share with us.

Yes. The best one yet. It's the birthday boy. It's going to be the best year yet. 23 years old. I'm telling you how I feel. I got you a gift jack. Key word.

I'm not going to tell you. No spoilers. Porcelain. You'll understand when you see it. Okay. Three stories, yeah. Do we mention this is the best one yet? Oh yeah.

Actually, this day was a huge day on Wall Street yesterday. The Dow jumped 1,200 points. In fact, this is the fourth 1,000 point swing up or down in the past two weeks. All right, now we can get to our three wonderful stories. Campbell's Soup jumped 9% because canned soup is having a moment. But here is the best part about it, Snackers. The numbers are so shocking the CEO didn't even believe that. Hey, Jerry, can you run those revenue figures again for us?

Our second start, United Health, a health insurance company. The stock grows 11% not because of its underlying business. And not because of a press release, not because of a product launch, and not because of an earnings report. Because of Super Tuesday, the big election yesterday. It's pricing in policy risk. Third and final story, H&M doesn't just whip up 30 different styles of a leopard print skirt in 10 minutes. Although it does do that, it does it really well. The fast fashion icon has a new business.

The new business is called Open Supply Chain, which is basically Airbnb out your second assembly. Now, Snackers, before we jump into that wonderful mix of stories, we got to set up a meeting. Are we doing I calendar? Is this a two-on-one? Google Cal? One-on-one? Outlook? You sending the invite?

My number are yours. I don't know. Did you reserve a room for this thing? Meetings are inefficient people. Sorry, I'm going to be five minutes late to the Google Hangout. Oh, I didn't realize it was in person. Also, how many minutes are we dedicating to coronavirus small talk? Oh, let's not shake hands.

I think it's guaranteed for six minutes to have to be like, hey, I just heard this thing about coronavirus. That's right, Snackers. Meetings are a pain. But Francesco Grosa, a great snacker who hails from Buenos Aires, tells us that $37 billion of lost productivity happen every year in the United States because of meetings. Jack and I jumped in snacks style. Set up a meeting

to look into this further. Turns out the average manager or exec is spending 23 hours per week per person in meetings. My buddy Aaron from college had a meeting club about meetings.

Jack and I did meet every week. We took another half hour to look into this further. Turns out a third of meetings are unproductive. And another third start late. We're thinking there's a little bit

of overlap there. So maybe there's like a third if best that are actually productive. Best excuse ever. Sorry I'm a little late to this meeting. My other meeting. went a little late. Now, Snackers, if you're out there and you're in charge of like work from home

policies, we highly recommend work from home Wednesdays. Right. You should have done this yesterday. Jack and I like to do this. We like to call them productivity days because you can treat yourself out to dinner the night before. And you don't do any meetings that day. You can do yoga in the morning. You can walk a friend's dog. This is all good stuff for personal wellness. Treat yourself before you can treat your progress. Divide up the week, work from home Wednesdays, aka productivity days. Let's get to our stories. 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. Snacks is digestible. Business news for you.

Robberhood Financial, LLC, member FINRA slash SIPC. For our first story, Snackers, I'm going to throw a little garnish on Jack. over there. Campbell's Soup just shockingly jumped 10% because soup is back in. The main reason the stock jump is coronavirus. Yeah, that's true. Yeah, that was really happening. Those expiration date 2042 Spaghettios, they're back in style right now. Apparently they're perfect as like disaster relief food. You stock your basement with these days. I spent $380 at Safeway the other day. At least 50 of them were on Campbell Soups. Hey, Campbell Soup biz dev team. Jack and I have a wonderful idea for you. A first aid kit for food. Yeah, team up with our buddies over

a blue apron who desperately need it right now. None of us millennials have like, you know, three weeks worth of food in the basement. We want a three-by-three-foot box of stuff that doesn't expire for like three generations. It's like army style. But let's talk about the 20 aughts. What is the hell of the odds? That's what generationists refer to the time between 2000 and 2000.

No, 2010 and 2012. Jack and I are a generationist, so we call them as the time between 2000 and 2010. Now, during that period, we're calling it also the soup apocalypse. Oh, it was nasty out there. Millennials are drinking juice cleanses. and smoothies, not bowls of condensed sodium. Yeah, apparently the weapon here was assaye bowls, destroyed soup.

Even the reduced sodium version has like 80 grams of sodium. Yeah, waiter, I'll have the sodium with a side of chicken noodle. Hold the broth. Snackers, get this. Campbell's U.S. soup sales have fallen for eight of the past nine years. And grocery store managers, notice that, so they were taken away shells that were once reserved

for, like, that Primo Campbell product. That's a sad moment for Campbell's Soup when you no longer have, like, ILCs. That can was an icon. I think it was like the holiest. costume of 1986. But wait, there's been a sign of a turnaround. Last quarter, there was a soup surge for Campbell's soup. We're talking soup surge. And just in case you're wondering what we mean by surge, we're talking a 1% increase in sales. Yeah, but for Campbell's soup,

they gained market share in the food category for the first time since 2017. Oh my God, absolutely, this is big. Broccoli sales are in like a 30-year coma and you just saw like the finger twitch for the first time. Hey, Houdie! Get in here! Get in here! One percent! It's moving. But one of the proudest moments was when the CEO gave shout out specifically to Tomatoes. Souta soup, chicken noodle, and cream of mushroom for their strong performance over the last three months. Side note, pretty amazing that Campbell Soup is a publicly traded company. It's an impressive thing. By the way, a lot of that bump was paid marketing.

Advertising was up 7% last quarter. They actually spent $238 million on like ads. But the other part was actually our takeaway. So, Jack, what is our takeaway for our buddies who are creamy over at Campbell's Suit? Let's all shift our interpretation of what a millennial is so true. Because millennials are becoming heads of household. Snackers, here is the key. key quote from the CEO. First, we are attracting younger households. But then Mr. Klaus went on to say,

frankly, that's a trend. Many believed not possible. Literally the CEO of Campbell's Soup's looking at what just happened to Campbell Soup, and he can't even believe Seabst is not believe that millennials are buying his soup. But it's happening. Campbell Soup Snackers is an indicator of a very interesting shift. Millennials are becoming a generation of family members. Oh my God. Millennials used to mean like 20-something-year-olds who are like philosophy majors living in their parents' basements. We got to that rap. We don't like that narrative. But that was like 10 years ago. Millennials like me are now adults. We have adult responsibilities, which means adult spending. And that can drive sales of something these days like household soup. I'm 32. I'm still millennial. We'll be for life.

For our second story, United Health just had its best day since 2009 as Biden had a strong Super Tuesday. Congratulations 14 states plus American Samoa. We're happy for you over here. No more political ads until the summer. You can watch TV without hating yourself. Now this story is actually a nice segue if you get caught in a corner during the water cooler conversation where someone like insists you talk about politics. Right. You can segue with this story to a great business. This is what we call a powerful pivot.

And of course, then ask the person who's interrogating you, H-Y-H-Y-S-D. It's always the way to do it. Have one of these in your backpack at all time, Snackers. On Tuesday, Joe Biden did really well, winning most states on Super Tuesday. He now has a delegate lead among Democrats to become the potential nominee. Now, Bernie Sanders from Vermont came in second. in place. Now that's a big deal for one particular industry, the health insurance industry. The health insurance industry has been fearing a Bernie Sanders victory for president. And that's because

Bernie's number one policy is Medicare for all, which would be very bad for health care companies like United Health. Meanwhile, Joe Biden's health care plan is a little more status quo. Pretty much take the existing system and add a public option to compete with private health insurance. So Snackers, Jack and I found this so interesting because investors have been pricing in the risk that Bernie would win to health insurance. Think about it. A Bernie Sanders victory could potentially eliminate private health insurance altogether. Right. If you're at health insurance company, a private health insurance company, you're looking at Bernie's policy. You may not exist under it. The stock price of United Health,

for example, could go to zero if Bernie Sanders becomes president and somehow passes Medicare for all. That's because its primary business, health insurance would no longer be a business. So investors who are thinking about United Healthcare, they might be thinking, what are the chances of Medicare for all? In other words, what are the chances United Health Care goes to zero dollars. So Jack and I whipped up the old whiteboard. We actually called ironically a meeting again. Let's say the chances of that were 10% prior to Super Tuesday.

Snackers, that's not the real percent. We're just saying it's a potential percent because Bernie would have to become the Democratic nominee, become elected president, and then this would have to pass. So if you're thinking about United Healthcare stock, you might think the core business is worth like, let's say, $100, but there's a 10% chance it becomes $0 in the case of Bernie and Medicare. So that may drop the same. stock down a little bit closer to $90, and that's what we would call in pricing in the risk.

Exactly. But after Super Tuesday, that risk of Medicare for all becoming a reality, a k.a. a catastrophe for health insurance companies. That risk dropped because Joe Biden got so much momentum. So with the risk of catastrophe for health insurance stocks lower, that price of the stock may move closer to $100. That's exactly what happened yesterday with United Health and most of the health insurance companies. So, Jack, can you whip out the thermometer and tell us what the takeaway is for our buddies over at United Health? Policy risk affects certain stocks more than others. Snackers think of tobacco and gun stocks.

They reflect the risk of anti-tobacco or gun control laws happening. Think about defense stocks. That reflects the risk of foreign military conflict or even worse for the defense industry. They hate this thing. Peace. Worst P-lover word for those guys. And look at clean energy, those stocks reflect the risk of like this president who's pro-climate change action versus that president who's not.

Snackers policy risk is baked into stocks in these industries in particular. And when politics changed. do the stock prices. And election year 2020 is kind of the year of policy risk. For our third and final story, this one's wild. Fast fashionista, H&M, just launched a new business. Truths. No.

Rompers. Not rompims. No, no, good guess. Not bomber jackets either. The name of the business is going to be called Treadler. And Treadler is basically when H&M rents out its extra assembly lines, Airbnb style. Again, the name is Tredler. It sounds like a new product launch from Peloton.

Now, H&M is a publicly traded company based out of Scandinavia, I think Sweden. We're going to go with Sweden on this one. It's one of the top three fashion retailers in the whole wide world. Now, Snackers, when it comes to the competitive advantage that H&M has, it's the supply chain. They can make a new floral butterfly sleeveless blouse like yesterday. Boom, and then when they want to whip up the print, change it from Magnolias to daisies. They do the same thing.

It's in stores like the next week. This company is wicked fast. On the other hand, it takes like General Motors like 10 years to go from idea to new car. still working on new car. But let's also talk about their social disadvantage. Right, not their competitive advantage, their social disadvantage. I was shocked by this one.

Fashion, the whole industry, clothing, makes up 10% of global greenhouse gas emissions. And 73% of clothes end up burned or in a landfill. So like, look in the mirror right now. Stare at yourself. Those pants, boxers, let's all think about this. Do we need another thing because it's ending up burned or in a landfill? Three quarters of what you're wearing?

right now is probably going to be burned during a land. All right, back to Tredler. It is supposed to capitalize on H&M's valuable supply chain. Their competitive advantage. And it's pollution guilt, which we just talked about. Their social disadvantage. They're basically going to let small and medium-sized fashion brands access its factories and its supply chain so they can start up quicker.

Hey, fashion startup. Are you free the weekend of March 18th? Oh, yeah. My factory in Bangladesh is actually free. You want to book it? Perfect. Let's get sewn up in there. That's basically what's happening.

Now, let's say Jack and I want it to start. our really exciting Nick and Jack slam and Sam and Oxford shirt company. The biggest challenge with starting a slam and Sam and Oxford shirt company is buttoning on those buttons. Yes, someone's got to do it. And when we went to the button company, they're like, hey, we're going to sell them to high price because we don't know if you're going to be around in six months. We don't even know if your check will arrive in the mail. We don't know you.

Right. You're a startup. We're not going to charge a lot of money for you. As you can hear, it's tough for a startup clothing company to actually start up. They're called startup costs. They're heavy. On the other hand, H&M has the opposite. It has something called economies of scale.

It buys things in such bulk orders and has such big factories that it can get lower prices for all labor and materials. And H&M probably has a procurement team that's just like sitting around with a few extra hours, and they could happily procure our salmon fabric. They're like done working on that floral butterfly sleeve blouse already. H&M also has a factory only run in half capacity, like I said, in Bangladesh. They could throw on our production line. Boom. Next thing you know, Nick and Jack Slam and Sam and Oxford shirt company is using Treadler and jumping ahead of the game, with cheaper prices. So Jack, what's the takeaway for our buddies over at H&M?

This could actually be a Trojan horse for some devious activities. Snacker, smaller brands in this case will get the resources to quickly innovate in the fashion world, but that's coming at a price. First of all, H&M is going to learn what you're working on, what is selling well and what got shut down because no one wanted to buy it. Not only is H&M getting the money out of this, they're getting that valuable data about what is selling. But H&M isn't the only one that can get both fees for their service and valuable data about stuff they can use in their core business. Remember Snackers just a week ago we were talking about Amazon that's offering up its cashierless Amazon Go tech to other retail stores.

Think about it. Dwayne Reed, the pharmacy in New York City, they might use Amazon Go. And if they do, Amazon will know everything that is selling in Dwayne Reed drugstores. And then Amazon can use that data from the streets to eventually change what they're selling online and maybe destroy Dwayne Reed. Airbnb out your resources to smaller companies could seem like a generous thing, but there's valuable data in there. Jack, can you spit the cake out of your mouth for a second

and whip up the takeaways for us over there? Campbell Soup, by the way, it's my birthday. I can T-Boy if I want to. Please. Campbell's Soup was shocked to see soup sales rise last quarter. Millennials have become heads of households and are buying apparently soup. Second story.

United Health Insurance Company is relieved that Joe Briden had a surprisingly good Super Tuesday. Investors' price and risks to future profits and Medicare for all risk just went down. Third and final story, H&M is. the fastest lowest cost assembly line there is. And they're also guilty about their carbon footprint. So they're going to Airbnb out their resources to smaller fashion firms.

They're calling it, Treadler. Now, Snackers, time for a snack back to the day. This one's from a guy who was born and raised in flannel. I can't even believe it. We're talking Jack Kramer from Brattleboro, Vermont, or as we like to call it, The Sixth Borough. That was a Nick Martell original. Five boroughs of New York plus Brattleboro, Vermont.

Just the further north in the Bronx. All right. I'll keep it in New York, actually. The Brooklyn Bridge, which is my favorite bridge. It's gorgeous. Opened up in 1883, connecting Manhattan with Brooklyn, first suspension bridge in the world. Jack, can you give me a little more details on the measurements? You know how long that thing is?

Talk to me. Five football fields long, because in my family, we measure things by football fields. It's actually, it's a healthy thing. The UK may want to consider this. So when they first opened it up, people weren't sure if it would hold the weight of, like, a bunch of people and a bunch of Ford Model T's. I can imagine. I mean, Williamsburg's a hit place. it always has been, they want to get over there.

So a guy named P.T. Barnum decided to put on a bit of a stunt show to assure the public that this bridge was strong enough. So what did he do? Are you ready for what he did? Talk to us. He took a bunch of elephants and walked him across the bridge in a massive public demonstration. Oh, my God. If anyone knows New York elephants, they were probably like, can you stop staring me and just move on?

We're trying to get across the bridge already. Well, you didn't even catch the PT Barnum part. You know who Barnum is? Talk to me again. The Ringling Brothers and Barnum and Bailey Circus. Yes. That was my T-boy snack fact of the day. Snackers, that was a fantastic tea boy.

That was fantastic birthday. But remember, H-Y-H-Y-S-D. Have you had your snacks days? If you know, you know, great snacking with you today. See you tomorrow. Can't wait. This is Jack. I own stock of Amazon.

The Robin Hood Snacks podcast you just heard reflects the opinions of only the host who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robin Hood 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.