The Best One Yet - Lyft’s 5-star earnings, Sam Adams is not a beer company, and opioid stocks get a penalty price tag

Episode Date: August 8, 2019

Lyft jumped after its huge loss wasn’t as bad as expected — but we found two other stories with a bigger takeaway about the tech industry. Boston Beer Company is famous for its Sam Adams label, but a recent report highlights why it’s not a beer stock anymore. And prescription drug distributors are getting sued by states, and we learned a key price tag of the opioid epidemic.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, August 8th. And this is the best one yet. We're bringing you a T-boy on this Thursday. Let's go. This is a really good one.

Now, markets drop big. Then they came back. Things settled down. Pretty nice. Jack and I found three wonderful stories. Markets ended just about flat, but stay calm. Don't worry about the skittishness. It's about long-term investing.

We got your back. Jack, what's number one? All right. Lyft gets five stars and a tip for its earnings report. But then we heard about two stories that were very unlifty. Apparently Lyft's not as woke as you thought it was. By the way, someone is listening to this in a Lyft right now. Send us a shot of the pod with you in the Lyft.

We'd love to see it. That's kind of wild. Not happy about Lyft being unwoke, but that's the story we got for you. Second story. What we got? Opioids in America. We just figured out how much the drug crisis will cost prescription drug distributors. It's somewhere between 10 billion and 44. billion dollars we have got a number it's a big number doesn't matter what the number is we've got

a number jack third and final story boston beer owner sam adams beer it's actually mostly a gluten free spiked seltzer company not a beer company sweet caroline sweet caroline holy cape cod jack this is not really a beer company anymore let's get into this thing before we do no ma no ma gasea jack we got to talk about brain orgasms all right so apple just came out with a new advertising campaign. You've all seen the billboards that have like beautiful photographs that say shot on iPhone, right? Right. There's usually like a giraffe and elephant or like nine other exotic species on these. This is the same concept but in video form. We're talking ASMR, autonomous sensory meridian response. So Apple posted these four videos on YouTube. You're probably

going to see them on TV or like between Hulu episodes coming soon. Now they're filled with ASMR, which is like that weird kind of creepy light noise that gives you a tingly feeling like a little bit of goosebumps a little bit of hair standing up your joints kind of feel weird snackers you got to watch these videos it's like a new thing it's as if like a creepy person comes really close to you and whispers in your ears and like the whiskers on their face also brush your ears or it's like when you're in yoga class and you're just trying to hold the pose your eyes are a little close and someone comes up and goes that downward talk is a little bit wrong yeah there's four different videos one features tapping. Another features

crunching. Scraping and whiskers are the four things. The scraping one, just to give you an idea, it's some, like, craftsman carving wood, and you feel like you're, you are the wood. So basically the ASMR videos, they sound like this. They sound like this. It's kind of like this. It's a lot of this. It's a lot of that. Jack, what's the takeaway

about the ASMR videos? We got two takeaways here. It's not just shot on iPhone. In the sub-note of the video, it says additional software and professional hardware required. So our takeaways, Apple's got a new thing that gives us the hebi-jeebies. And number two, shot on iPhone, you need an asterisk on that thing. We spoke to the lawyers.

It 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. You know, 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. for you. Rob her financial LLC. Member Fenra slash SIPC. For our first story, Lyft's shares just jumped after it's like big earnings report. But there were too distracting other reports that we're also going to talk about. Okay, spoiler alert on Lyft's earnings from now for like forever. Lyft lost a lot of money. Last quarter. True. Prices are really low when you take a Lyft ride and the promos are really high.

That makes it really hard to make a profit. Yes. And last year's second quarter for comparison sake, the company lost $179 million. This year's second quarter, the company lost $644 million. So that sounds really bad, but there were a couple pieces of good news. First, that loss was better than investors actually expected. Also, revenue surged like 72% to another record. Now, this one's my favorite. The CEO announced that 2019 will be the peak loss year for the company. If you've got somebody's working at Lyft, get this, they're probably going to be celebrating 2019 years from now.

Like, hey, remember what we used to lose millions and hundreds of millions of dollars a year? That was crazy. So what the CEO is saying, they're not necessarily going to have a profit next year, but the loss will be smaller, and eventually they'll climb up to profit territory. So that's what, like, the earnings were. But we were really fascinated about two other reports completely separate that happened to come out the same day. The first one was from the Washington Post.

Riders have been reporting that they feel uncomfortable in the backseat when drivers harass them and Lyft's responses to that claim of harassment has been pretty unimpressive. That's the kind of criticism we're used to hearing about Uber. First time we've heard about Lyft. And get this, Uber has a panic button. Lift doesn't. Yes, if you're in an Uber and a driver's super creepy and makes you give him your phone number or something, Uber has a one-click thing in your app to immediately, like, call for help.

With Lyft, you've got to kind of. like click around, find the help button, and it's not as easy as it should be. Now, that was the first report from the Washington Post. The second report about Lyft was actually commissioned by Uber and Lyft. Yeah, basically, there have been claims that Uber and Lyft are adding to traffic problems in cities, not relieving traffic, which is what they were hoping for. So they commissioned a report to figure it out. So we jumped into this report.

Turns out there's some crazy stats in this thing. For example, 14% of all car miles traveled within a city like San Francisco, are ride hail cars, not your car. Right. And 40% of the time overall, not just in San Francisco, Ubers and lifts are driving around with nobody in the back seats. They're kind of just looking to pick someone up, but they're not picking someone up.

They're just taking up road space. When you hear that kind of data, cities react. For example, New York City reacted yesterday, and they're extending the cap on how many Ubers and lifts they're going to allow in the city for like another year. Yeah, I think it's like 15,000 Ubers or lifts in the city. So, Jack, what's the takeaway for our? our buddies riding around a lot apparently over at Lyft.

Here's the thing about that reputation issue. It hasn't affected big tech companies. Delete Uber. Hashtag delete Uber. It helped lift for like a little bit, but Uber is still the leader when it comes to to ride-haling. And so now Lyft is kind of acting Uber-ish. And another one, hashtag delete Facebook.

I remember when that was going on, but it hasn't affected the company. It's doing better than ever. What we're noticing is that like in a world where there are one or two tech leaders in each industry, there's less accountability because there's just not enough competition. So Lyft's thinking to itself, being woke was cool, but we kind of want to make profits to, and I don't want to add more customer support at all, blah, blah, blah, blah. For our second story, the opioid epidemic that everyone's been talking about just transformed from an ambiguous crisis into a huge price tag. There is lots of guilt to go around with the opioid epidemic in America, and we're not experts, but I think there's a few places that are probably going to pay for this. So, for example, doctors, they were giving away way too many prescriptions.

And then the one you've probably heard about Purdue Pharmaceutical, it seemed to be totally like pushing its pills to doctors and overprescribing as well. Yesterday's focus, though, was on prescription drug distributors. We're actually getting the stuff out to doctors. There are three publicly traded companies that basically hook up all of these pharmacies with painkillers and prescription opioids. They're called McKessingorp, Cardinal Health, and Amera. Sorry, Amerisaurus Bergen, brutally named. Brutal name. They got to work on that.

Now, the big news was that 35 states' attorneys general, so the key lawyers in these states, have sued those three companies. The allegation is basically you clearly weren't keeping track of the dangerous drugs that you were pushing into communities. Case in point, great example here. There are entire counties in the United States where there was distributed 100 pills per a person per a year, which is a whopping number. Yeah, that's insane amounts of pills. Like, not per diagnosed person, per human being living in. in that area. So the lawsuit saying, hey, three companies here, you were complicit in the mass overdosing of opioids pretty much across the country. Yeah, it sounds like you were kind of just

turning your head, not worrying about the consequences, and just letting that profit chugging machine chug. Now, here's what the key inflection point was that we thought was so interesting. Yesterday, a Bloomberg article reported that these companies have said to the states, hey, let's like, relax, let's settle this thing, we'll pay $10 billion, and that will be it. And then the states came back and said, I will raise you $10 billion to $45 billion. And then maybe we'll talk. $10 billion is not enough. Stocks fail.

So, Jack, what's the takeaway for our buddies who are over in the pharmaceutical industry? New news matters more than official news. So here's the key insight with stocks. What matters isn't when the news about the stock becomes official. What matters is when the news becomes credible. That Bloomberg report we heard about yesterday, it's not an official report. In fact, a settlement hasn't been reached. But it was a new report and it was a credible report.

And now investors know that the opioid crisis can likely cost between $10 billion and like $45 billion. Big range there, but big billions. They didn't know how much it was going to cost before. But clearly this price tag is more than expected because once the report came out, investors reacted and the stocks fell by 6% each. Now this new credible news, it's been like it's been baked into the stocks as of yesterday. And that's why they dropped. And maybe when the news does become official, maybe the stocks won't move because they already expected it based on yesterday's report.

Credible new news. Our third and final story is a wild one. A recent report we found revealed that Boston Beer Company isn't really a beer company anymore. Snackers, this is the company that owns Sam Adams. This is the company where the CEO goes on commercials and loudly proclaims over and over, hey, we're a craft beer company. We are a craft beer company. Incredibly insecure. We get it. You have beers and you drink beer. It's totally artisan. Great. Do your thing. Why are you spending so much on TV ads. Now, the stock is at record highs. Yes. And it recently acquired Dogfish Head and it also owns Sam Adams and a bunch of other brands. But what we were most interested in was an IRA research report that showed that the company has shipped 21% more of its drinks from last summer. Yeah, the earnings come out in like a month or two for the summer. But that is a great preview. And that is incredible shipping growth. It's double the expectations. And there was one statistic.

buried in this report, in particular, that we thought was fascinating. Jack, can you serve this up? Only one quarter of Boston beer's sales are actually beer. The rest are non-beer. That's it. One quarter, 25% in the second quarter. Sales of truly, which is at Spike Seltzer, surged 163%. Spiked seltzer is so in this summer.

You know what I mean? The citrus mix pack, Jack, you know, you can bathe in this thing. It is very fruity, lots of fruity flavors, and people are loving. it on the beach. If you are at a beach right now, look around. I bet you people aren't drinking beer. They're probably drinking something spiked. Someone's got a hibiscus grapefruit flavored something in their hand, and we know it's probably so into your life. Boston beer also owns twisted tea, which is up 22% shipping so far this summer. And then they also just recently launched Angry Orchard Cider Rosea, which is a new version of Angry Orchard. That sounds on trend,

Angry Orchard Rose. Aggressively. It's like they threw a bunch of things on the board. This is like a cider that wants to be so basic about a sole cycle package. Now, the last one, it's working on a hard kombucha. Sign me up for that hard kombucha. Jack, again, something he would bathe in. So, Jack, what is the takeaway for our buddies who are not really in beer anymore over at Boston Beer? This is the post-beer era. There are no truly successful beer stocks we can think of right now.

Jack, get on a podium and throw this stuff out there. Boston Beer is mainly not beer, as we just told you. A. B. InBev, which owned Budweiser, they're investing in, like, non-beer anything these days. And Constellation, it does own Modello, and it does own Corona in the United States, but it's the whiskey, vodka, spirits, and even CBD-infused drinks that are growing for Constellation brands. Now, perfectly last week, we also heard from another beer company stock. That was Moulson Coors, and they announced earnings. And Coors Light also sales are dropping. Surprise, surprise. To the point where their CEO is actually going to stack down. So when you look at the whole beer industry, it's pretty clear. No more purely beer public companies are winning. Jack, can you whip up the

tea boy takeaways for us over here? Lyft thinks that it's at peak loss, but it also thinks that social issues like sexual harassment aren't as important, apparently. Liv's getting some like Uber-ish kind of qualities here. Three drug distributors just found out they'll probably have to pay between 10 and 45 billion for their role in the opioid epidemic. And investors are seeing a price tag on what this whole thing could cost. Boston beer. company is 75% not Boston beer. We did the math on it and it looks like there really aren't that many purely beer stocks left. Now, time for our snack fact of the day. This one sent in by Dakota in Apple Valley, California, which doesn't sound like a real place. It sounds like something like a Pixar movie.

Sounds like some cider, Spike Cider. You can find in Apple Valley. Dakota, but it sounds lovely. We'd love to see a picture. Jack, what do we got here? So get this, 55% of all the content. on the World Wide Web is in the English language, even though only 20% of the world speaks English. By the way, number two and number three languages on the internet, Russian and German. But keep in mind, this report, it's like a few years old. It's a few years old, and the only way it could have meaningfully changed is because of China's rise and its strong tech industry. Dakota, we appreciate you sending this in, even it's from a pixelated fake Disney World Place. Now, a couple other key stories you got to keep in mind today.

The New York Times announced its earnings last quarter. The stock dipped by 13% because subscriber growth is slowing. Snackers, it was so much fun to be with you. You guys look great. Keep doing what you're doing. Keep driving, walking, running. Snackers, tomorrow's Friday. You're almost there.

We are too. We're with you. We're with you. We'll speak with you tomorrow. 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.