The Best One Yet - Play-Doh saves Hasbro, Twitter surges 16%, and Harley-Davidson and Whirlpool get opposite tariff drama

Episode Date: April 24, 2019

Twitter jumped 16% after focusing on a new metric to make you impressed. Hasbro surged 14% after Play-Doh, Monopoly, and Transformers powered its first sales gain in 6 quarters. And Harley-Davidson stock dipped, while Whirlpool’s rose, but both because of one thing: Tariffs.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 Wednesday, April 24th. And this is the best one yet. The best snacks daily. Perfect day. Market driving a hell of a year. This is insane. The S&P 500 just hit a record high. We're talking the highest level it's hit ever in life. And it's up 17% so far in 2019, which is its best start to the year since 1987. I wish I could say I remember it. I don't want to date myself, but we weren't even born. 1987 is pre-us. This is definitely not in the Snacks timeline. But we got three great stories we're going to break down for it. Wonderful mix. You want to hit this on? The first story is trending. Twitter.

It jumped 16% because it created a new metric that it's doing really well. Very strategic move. When you don't like the ruler you're measuring with, just switch to the metrics system. Second story is Hasbro. The toy genius rose 14% thanks to Play-Doh and Transform. They have survived the Toys R Uspocalypse. This is fascinating. You ready for the third and final story?

Please hit me with this. Carly Davidson motorcycles and Whirlpool washing machines. They are the key to the best lesson yet on tariffs. Most stocks don't feel tariffs, but the ones who do, they really feel tariffs. They really feel the tariffs. Now, before we jump into all that, wild story, we're going to mix a little TMZ with a little Wall Street Journal with a little bit of, I don't know, ESPN. A little bit of NFL quarterbacking.

Throw that in. This is a snacks approved story. Russell Wilson, the quarterback on the CFO. Seattle Seahawks. Graytown. Former Wisconsin Badger, former North Carolina State Wolfpack. Current human.

Current human. He is giving $12,000 in Amazon stock to each of his 13 offensive lines. This is not like a typical thing. Like if you're a QB, you want that protection. Maybe you give, I don't know, a Rolex. A dinner day. The tradition is like a Rolex or steak dinner.

I heard Tom Brady gave cheese steaks, which is like, he did. At Ann Arbor, actually, Mr. Spots. But Russell Wilson gave him. $12,000 of Amazon stock, which is a local company based in Seattle. And he gave it not just to the starting offensive lineman, but to eight backups. It's like Oprah, you get stock, you get stock, you get stock. He included a note that said, you have invested in my life. This is my investment in yours. Wow. I like that he's helping his buddies invest, by the way. I love this combination of things.

And like small town, local investing here. Seattle, great town, who cares about the rain. Now, before we get into the stories, listen to these important words. 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. Snacks is digestible. Business news for you. Robahood Financial, LLC, member FINRA, For our first story, Twitter shares just searched 17% basically because it dominated ads. Twitter's having a moment.

Twitter's having a tweet moment. I had a Twitter moment once. People have that. I got retweeted by a pretty famous person. It's a great 10 seconds. It was awesome. Jack didn't stop talking about it. Now, profits tripled for Twitter last corner, even though user growth barely budged.

Now, that's key. So if you're Twitter and you're looking at your user growth and it's barely budging, how do you, I don't know, deal with this situation? Well, you supercharged the advertisements, which it did. But it also moves the field goal posts by which it measures itself. Just a little bit to another field and looks at them from a completely different distance. For years, Twitter measured monthly active users. That's a key term.

It's like used for all the social media companies. The number of people who log into Twitter at least once a month. If you're clicking on the app, even if you don't do anything, as long as you're in there for like a little bit of time, they're counting you. Now, three quarters in a row, Twitter's monthly active users fell. Not a good thing. It's down right now to 330 million people log in at least once a month. That's a little bit more than Pinterest. It's way less than Facebook and Instagram.

So instead, Twitter comes along and they say, you know what, we're going to focus instead on something that's growing. Yeah, not monthly active users. Let's go with daily active users. Last quarter, they debuted daily active users. It's the first time the public saw how many people log in every day. Now, this is actually a more impressive metric. you could argue. Because, you know, you might accidentally open the Twitter app once a month.

But if you're going on a daily basis, like, you are there. 134 million people open Twitter every day. That's up from last year. But it's like a little bit less than Snapchat. Snapchat's beating it. But, you know, investors are smart. Right. They're not going to be duped by a little metric twisting. Yeah, investors are literate. They can read. They know there's a difference between daily and monthly. Still, Twitter is highlighting for investors what it wants it to focus on. It wants investors to focus on daily active users. So if you're an investor, you got an interesting situation here. Are you more interested in its overall growth, which it's shrinking? Or are you more interested in engagement, which is growing on a daily basis? Well, since

engagement is growing, Twitter can show more advertisements. Engagement is a measure of like how much money you can make. So Jack, in as few characters as possible, what is the takeaway for our buddies over Twitter? Twitter is the least dramatic of the social media companies. The journalist yesterday pointed out that Twitter, he thinks, has more upside than Facebook or Snapchat, because it's staying out of the drama. Well, look at Facebook and Snapchat. Facebook shares are up 40% this year. Snapchats more than doubled this year. Twitter shares are like chugging along at 35% up.

So Twitter is behind those other ones in stock performance, even though Snap is having a whole big existential crisis. Snap is on the therapist's couch saying, I don't know, should I go into video? Should I go into like my own shows? It has nightmares about Instagram. It has no idea. Facebook is getting, like, banned in some democracies. Exactly for hurting democracy. And in non-democracies as well.

Meanwhile, Twitter is there doing its thing. It has six consecutive quarters of profits. Its biggest issue is online trolls that love harassing people. But it's trying to make progress there. And it is making progress there. For our second story, Hasbro shares jump 14% because it survived the Toys Rous Pocklops. And it's thanks to the childhood brands that everybody loved growing up. But if you, like, one half,

have fun right now. Stop what you're doing. Open up the Hasbro earnings report and just flick through pages 6 through 30. It's a really clunky PDF that's going to look terrible on your phone. But if you zoom in, it is amazing. And you look past the financial jargon, you'll actually see some hilarious and adorable Hasbro characters. There is a Power Ranger jumping into the cash flow statement who is just all over this thing. Then you got like a freaky kind of Play-D-O situation. I didn't even know Plato had a mascot, did you? No. It's kind of looks like R2D2. No, it's, it's, I'm Eyes giving nightmares. It's like gap financial earnings with a dash of power range.

And it's just tossed in with a little bit of my little poem. Now, on page one of the earnings report, the Pawtucket, Rhode Island-based company stayed its mission. Create the world's best play experiences. Now, they did more than that yesterday because they thoroughly entertained shareholders with a total surprise of an earnings report. The surprise was that sales rose. Everyone thought they would fall because that's been like the thing.

Sales jumped by 2% last quarter. It's the first gain in six quarters. and that's all because of the toy apocalypse caused by the bankruptcy of Torres-R-S. Exactly. Toys R Us also was known as, to Hasbro, a place with a lot of shelves to sell our stuff. Yes, it was. And there's a lot fewer shelves out there because Toys R Us is gone. Shelves are particularly important for a lot of things. For example, if you're trying to sell plush toys, building toys, sports toys, things in a box, you need shelves and those weren't there. Guess what? There's actually still some shelves out there. And Hasbro has convinced drug stores and grocery stores.

to move out some food and replace them with toys because, look, parents still need to get their kids. The kids still need these toys. The shelves were in need. Now, if you're wondering which toys came to the rescue of Hasbro, we have got, this is like kind of an all-star list. Plato? Plato. Classic throwback. Monopoly. Monopoly. Rebounded sales. Wonderful. Magic the Gathering. Oh, my God. The old, like, game card. Apparently it's hit like a 2.0 version called the Gathering Arena. It's gone digital. Truly digital. And then Transformers is only. by Hasbro. It has a new movie out. Huge. Hasbro also has the licensing deals with Star Wars and the licensing deal with Frozen, which is still making revenue for Hasbro. If you haven't seen Frozen, then what are you doing? Do this right after that. So, Jack, what's the takeaway for our buddies in Rhode Island over at Hasbro?

Hasbro's following the Disney playbook. Transform beloved characters into entire profit ecosystems. Look at what Disney did with Star Wars. Movies, toys, theme parks, Star Wars like people who think they're in Star Wars. Look at what it's doing with Marvel. It's got like a few characters and it's turned them into 19 movies and that's probably going to get its own theme park too. Within the Marvel movies, I think the characters go and watch their own Marvel movies. It's a freaky ecosystem. Now, Hasbro has only successfully made like a profit ecosystem out of one of its characters, Transformers. Now, rival Mattel has caught onto this and it's launching movies for its core product, Barbie. So if you're Hasbro, you're thinking to yourself, we have this whole magic the gathering

game, which is like Pokemon, but a little more weird. So when are you getting Jennifer Lopez in there and launching Magic the Gathering, The Rom-com? You could turn Magic the Gathering into a whole trilogy, like Game of Throne Stop. Future theme park delivered. Plato? Plato should have a theme park. Why not? That character is freaky.

Hasbro's got a lot of potential to theme park the heck out of this. For our third and final story, Harley Davidson Shares just felt, Whirlpool washer shales just rose and was all for the same reason. One word. Teriffs. Harris with a T. Quick update. The trade war is still very much on.

It has not stopped. We haven't talked about it yet on this pod since we relaunched as Robin Hood snacks. Not lately. But it is still on. It's happening. Half of what we import from China gets hit with the tariff. And most of what we're exporting to Europe and China, that's getting a tariff on it. The trade war is still on.

We'll let you know if something changes. In the meantime, we'll talk about companies earning reports that are affected by them. Now, here are the two companies going to focus on, because both reported yesterday. And we learned a lot from each. So Harley, Davidson and Warup. First, terrorists have hit Harley pretty, pretty hard. Profits fell in the first quarter by 27%. Wall Street punished Harley by knocking down shares by 2%.

Europe specifically like, you know, they loved riding on their Vespas, they liked their smaller bikes, called out Harley with tariffs to retaliate. Germans actually love Harleys. They like the big Harleys. Believe it or not. And Italians are more like, V-V-B. A little more electric. But Europe punished Jack Daniels.

Harley Davidson and Levi's jeans, remember, specifically for their American, like, unique qualities. Their Americanness. And so Harley had to move production overseas, and it's just, it's costing a lot of money to respond to these tariffs. Now, on the other side of the tariff situation, you have got Whirlpool. Fantastic. Based in Michigan. Great washing machines. Yes. Profits rose by 10% last quarter. And it's an interesting reason why. Exactly. It's because the U.S. through some tariffs on Korean-made washing machines. Right. And we're talking Samsung and LG.

They're both made in Korea, and they both have to pay extra tariffs before they hit the U.S. That means they raise their prices in the U.S. Samsung and LG raise their prices. And guess what? I don't know. Whirlpool did too. Wow.

Everyone's a little bit more expensive. You know why Whirlpool raised prices? Because it can. Because it could. It did. And it's taking home more profit because people have to pay more for washing. 10% more profit. So, Jack, what's the takeaway for our buddies over?

Red Harley and Whirlpool who are dealing with tariffs in different ways. We'll be honest with you. Tariffs have zero impact on most companies, but a huge impact on a few companies. Like look at 80% of the companies that you're using right now. 80% of the U.S. economy, it's non-physical, non-traded stuff, probably digital stuck on your phone. Right. It's like services. It's stuff you can't touch, but you can see on your smartphone.

But you feel. Tariffs don't affect them too much. No. But the manufacturing heavy Midwestern, bronze, steel, eye. iron. What is brawn? Can we get it? These industries like Whirlpool and Harley Davidson, they're feeling these tariffs because

they do a lot of trade. Meanwhile, Silicon Valley, not feeling the tariffs as much. Hardware and hogs are feeling it. Jack, can you whip up the takeaways for us? Twitter. It is not as dramatic as the other social media companies, but it's got six profits in a row. You could pin that earnings report. It was a nice one. Second story, Hasbro has to

follow the Disney playbook. Transform your beloved characters into giant profit ecosystem. Little pony. on ice. And Harley Davidson and Whirlpool. Tariffs have zero impact on most companies, but a huge impact on a few. Like a really, really big impact. Now, time for the snack fact of the day. Jack, name this. This data is a little bit outdated. It's from 2014 from Ancestry.com. We'll round up. But Smith is the most popular last name in 40 of the 50 U.S. States. Which makes you really wonder about what's going on in the other 10. I assume Smith is number two. It's number two in most of them.

You beat it. Give me some names. You got 10 other number ones. You got Johnson. Johnson. All right. You got Martinez. Great. Garcia. Okay. Lee. Nice. And did I say Johnson? You did. We'll keep rolling with it. A couple other awesome stories in the Snacks Daily Newsletter, Robin Hood Snacks. There was an earnings banza yesterday. Too many. You got Coca-Cola, Verizon, United Technologies. More. A bunch of dollars. You just keep going on. And then we just keep going on. we got Snapchat earnings, which were pretty fascinating, especially compared to Twitter. This was a great pod. Thanks for sharing it with us. We love to have you guys on. We'll talk to you tomorrow. Can't wait. 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.