The Best One Yet - 🍫 “The $50B Kiss” — Hershey’s salty strategy. Amazon’s 3 shockers. ExxonMobil’s unsayable word.

Episode Date: October 31, 2022

Hershey chocolate stock is at an all-time-high right now thanks to 1 thing: The Salty Sweet Strategy. Amazon just told us you’re getting coal for Christmas — we found 3 shockers in their earnings to explain why. And Exxon Mobile refuses to say the word — “Record.”$HSY $AMZN $XOMFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on YoutubeWant a Shoutout on the pod? Fill out this formGot the Best Fact Yet? We got a form for that tooLearn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

You look mildly email. I know. I look like a Targaryen made it with a rose pedal. What do I look like? You kind of looked like a marinara clown frow. You know, there's just nothing better than a slamming salmon wig. We've been saying it for years. Yes.

Yeah, right. Here we go. Here we go. Three, two. This is Nick. This is Jack. It's Monday, October 31st. Happy Halloween.

And today's pot, if you're wearing a slam and. salmon wig is the best one yet. These are the best wigs yet, Nick. Jack, you look fantastic and bangs. Yiddies, we got our winner of the T-boy business-themed Halloween costume contest. The best costume yet is wearing a bunch of balloons because you're going tonight as inflation. It's just a classic. Kelly literally dressed up as a bunch of balloons.

And we literally want to pay Kelly 9% more than last year. Yeties, feel free to suck that idea to your costume Halloween party tonight. Oh, wait. Can't broken supply chain. There's no helium, no rubber, no balloons. The worst, Jack. What's our first story? One of the best performing stocks this year. It is shockingly Hershey's Chocolate. Because Hershey's Candy Company went from a sweet strategy to a salty one. For our second story, Amazon just told us you're getting coal for Christmas.

But Jack and I found three surprises hidden in Amazon's earnings. And our third and final story, ExxonMobil. They're doing so well. They refuse to say one key word. Record. They won't say the word record. They're setting a record for not saying the word record. Just say the word record. It's not that hard. We just said it six times. But Yetis, before we hit that fantastic mix. The perfect mix for a Halloween Monday, Jack. We don't know what you did last summer, but we do know what you did last weekend.

Two words, Jack, pumpkin patch. First, you grab the whole family. Then you fit into some flannel. And finally, you took some photos for the gram. Because it's not just Jack of Lanterns that smile with a pumpkin these days. Oh, it ain't. It's little Timmy, too. Farmer Fred and your buddy Timmy. But we jumped in T-Boy style to Pumpkin Patch Economics.

Get this besties. The pumpkin patch can be a major profit puppy. That's right. According to the hustle, a typical pumpkin farmer can plant 3,000 pumpkins per acre. And based on our research, we know you'll pay $5 for every one of those pumpkins. And based on personal experience, you'll pay double that for twice as many. Premium pumpkin? Just take my cash. Which means patches can profit $5,000 per acre. And it's not just because of the pumpkins. Because, Jack, you got to add in all those add-ons.

That's right. If you're running a pumpkin patch, you've got to charge $3 per pumpkin patch ticket. Yeah, you got to charge $5 for that cider. Hey, rides, those will be $8. A dozen dollars for a dozen donuts. Suddenly, pumpkins are the most lucrative vegetable on the farm. Suddenly, each gourd is gushing bucks. Suddenly, each squash is squishing your wallet.

And before you know it, Jack, what are we seeing on the pumpkin patch? A profit, puppy. But yetis, we know what you're wondering. What's the state with the biggest pumpkin economy? Georgia does peaches. Blank does pumpkins. What's the place with the most pumpkin patches? What's the capital of U.S. pumpkin production?

The United States state with the most pumpkin patches is going to be announced at the end of this podcast. Let's hear that three stories. We'll see you that. Happy Pumpkin Day. 15 years before this song, two boys from the northeast met in the dawn. had an idea to cause a cultural storm. It's the 50% that's a fat tip. Tea boy city on your at list.

If you know, you know, because we're ready to go. We can't wait no more. So just start the show. Start the show. For our first story, Hershey's chocolate stock is at, get this, an all-time high. Hershey's incredible comeback is thanks to the salty sweet strategy. Jack, European nations,

they take pride in their national chocolate brands. They really do. They really do. The Swiss have lint. They do. The Brits have Cadbury. The Germans have Milka. Delicious.

I know you want me to mention the Italians. You may as well. Let's roll with it. The Nutella Classic. Yeah, but America, we got Hershey's. And yet he's Jack and I are prouder than ever of our buddies over at Hershey's. Thanks to the stock. Yeah.

The Hershey Company, based out of Hershey, Pennsylvania, they are, get this, beating 475 out of these S&P 500 stocks right now. What? Yes. The stock is up 25% this year. And the company is now worth $5. $50 billion. Sit down, stand up, and sit back down again, take a bite of that. That is 10 lifts of value or one-fifth of face.

Honestly, both are impressive. But Jack, five years ago, what was the situation over at Hershey's? Hershey's was struggling. It was the number one chocolate bar for making s'mores. Yeah. But it wasn't number one in anything else. Hershey's was melting. Honestly, the company almost even sold itself in 2016. But then, Hershey's made one powerful pivot. One big bet. One managerial maneuver that changed everything. open up your trick or treat bag tonight. That's not a Kit Kat in there. That's five years worth of strategy.

I just want to say that was a fantastic lead-up to like this story. I am excited right now. I know what's going to happen. I don't want to know what's going to happen. I'm just saying, you want to know. How did Hershey's turn everything around? How did it become the top performer of 22?

And the answer is the salty, sweet strategy. For 100 years, Hershey's business was 100% chocolate. Hershey's owned 46% of the U.S. chocolate market. They were dominating. Because it's not just Hershey's. They also have Snickers bar, Kit Kat, and crucially, reces. It's a variety pack right out of your mouth, Jack.

And you know what? Chocolate? That's a steady business. It's recession proof. It's the affordable splurge. You eat it in good times, bad times, medium times. You're eating it. But Hershey's made a bet five years ago.

It did. They said, let's have salty snacks. Be our second big thing. Now, Hershey's could have developed these in-house, but they decided to do something. a little more expensive. They dropped $4 billion buying up a whole bunch of snack companies. They bought all these other companies. In the last five years, they acquired Skinny Pop, the popcorn company, Dots, the pretzel company, and Pirate Booty, the popcorn-ish company.

Let's go with popcorn adjacent. Well, having those snacks turned out to be crucial timing during the pandemic when snacks took off. Yeah, for the last two years, this salty portfolio at Hershey's grew way faster than the sweets did. Hershey's was like less cookie jar, more kitchen sink. Last quarter, sweet sales at Hershey's grew by 13%. Not bad. But salty sales at Hershey's doubled from last year. Again. Popcorn has been popping up.

Pretzels have been crushing Reese's pieces. Salty snacks just gave Kit Katz and Nuggets. Jack, did you see in that Hershey's earnings? They literally break out the business into salty and sweet. I did. I was excited to see that. So, Jack, can you break us off a piece of the takeaway over there? Hershey stopped looking in the mirror and started looking at.

out the window. Yeties, Jack and I were trying all weekend long to figure out what motivated this brilliant, salty, sweet strategy. And that's when we realized. Hershey stopped looking at itself and started looking at the customer instead. If Hershey's just focused on itself, it would have kept doing what it was doing. Its core product, more chocolate. Instead, Hershey's looked at the customer, which is the American consumer who was no longer just a sweet tooth. Yeah, over 90% of Hershey's sales are in the United States anyway, and American tastes, they've shifted. According to the Wall Street Journal,

the past five years, Hershey stopped being a confectionary company and started reflecting America. And that pivot has been key. Hershey stopped looking in the mirror and started looking out the window. For our second story, Amazon just warned us

that it will make no money this holiday season. Here are three things that would shock you about Amazon's earnings. Amazon, just continuing this streak, Jack, of like, Big tech companies making Wall Street sad. Yeah, Amazon just announced that revenues rose by 15% last quarter, but profits fell. Now, the part that really worried investors yet is was Santa Watch, right, Jack?

Santa Watch 2020. Santa Watch 2020. Amazon just predicted that this fourth quarter, which we're in right now, they will make between zero and four billion dollars. We repeat, Amazon says they may make zero bucks on your stocking stuffers. Did they include zero dollars? in the range of money they might make this quarter? There you go. I got an elf shortage going on over here, Jack?

That is shocking. And here are two other shocking things about Amazon. On dancer, on Prancer, on Comet, on Vixen is Schfitsen. Amazon. Like the part of Amazon you use for online shopping. That Amazon. The primary thing Amazon does for the last 28 years, it's not profitable. Besties, if you just look at the e-commerce business, the Amazon.com we all shop with every day,

it's still losing money. Amazon.com is the biggest business we have ever seen that doesn't make money. You're like the main part of Amazon that actually does make money, Jack? Amazon Web Services. If they hadn't gotten into cloud computing, they'd have a not profitable business ready. It's the part of Amazon you didn't see. And that is shocking. So that's the second shocker about Amazon right now.

But Jack, what's the final shocker about Amazon right now? It's about employee turnover costs. Interesting. Not something we commonly talk about. but for Amazon they are $8 billion a year. Wow. That's according to internal documents that NGadget got a hang up. Yeah, just sprinkle on some context here.

That is $8 billion that Amazon spends just on hiring and just on firing. Amazon spends $8 billion to onboard Carol from accounting and all of her colleagues. Amazon has one and a half million employees, but only one out of three are still there in three months. There is more flipping going on at Amazon than at a waffle house. They got more turnover at Amazon than the Chicago Bears' quarter. The otherback's position. And the training, hiring, onboarding and re-onboarding for Amazon's replacement workers.

Talk to me, Jack. That costs $8 billion a year. And that's why Amazon.com is not profitable right now. So, Jack, what's the takeaway for our buddies over at Amazon? Say hello to the end of the tech booth. Yeties, last week hit a whole new threshold for big tech, the mini popping of major tech stocks. The word slowing, shrinking, supply chains, Santa Watch. 2022. They were all bad and they were all down. They're all buzzwords linked to negative stories around

big techs earnings all last week. The once trillion dollar companies that lifted the stock market for years got absolutely hammered last week. Get this, Microsoft lost $60 billion in value. Google lost $75 billion of stock market value. Meadow lost $80 billion in value. And Amazon lost $150 billion of value last week. Oh, and Twitter? It just, they kind of lost their soul. they did. Climbing interest rates aren't just hurting the economy. They crushed big tech's growth. So last week, we said hello to the end of the tech boom. Or goodbye to the tech boom. Or goodbye to the tech boom. Aloha to the tech boom. Now, a word about our sponsor, Robin Hood. You can do just about anything from your phone, but some industries, they've just been slow to move. The finance industry was

slow to move from phone to computer and then from computer to app. Robin Hood wasn't. It's the Silicon Valley-based brokerage that's been updating app since it was born in 2015. Using the Robin Hood app for your stocks and crypto is almost as easy as downloading it. So you can invest to your pace on your terms by downloading the Robin Hood app. If you're not investing on Robin Hood yet, to get started, go to robinhood.com slash T-Boy and choose your free stock. That's Robinhood.com slash T-B-O-Y limitation supply. Stocks are offered by Robin Hood Financial LLC, member SIPC.

Crypto offered through Robin Hood Crypto. All investments involve risk. By the way, this podcast is not owned by. are part of Robin Hood, and we are not employees of Robin Hood. For our third and final story, actually, I think we should sprinkle on some context here for the listeners out there because there's an audio product. Yeah, I just so, yaddies, if you're not wearing a slamming salmon wig right now, then you can't pod with us.

If you check us out on YouTube or Spotify, you'll see me in a carrot top situation and Nick in a heavily email one. Jack's going with like the bright pink perm. I'm working with more of a bang situation, which has been an issue with the microphone. Happy Halloween, Yeti. Yeah, happy Halloween. In the meantime, third story, ExxonMobil won't bid it, but they just had a record quarter. Oil companies don't celebrate record profits.

No, they don't. They whisper them. Besties, we're living in the iPhone era. We have been living in the iPhone era. For a decade, the most profitable company in the whole market has been Apple. But hold the phone. ExxonMobil, last quarter. Was this close to passing Apple in profits?

Everyone's talking recession these days, but profits over at Exxon's oil company nearly tripled from last year. Exxon made $19.7 billion in rich oily profits last quarter. Which was so close to beating the $20.7 billion that Apple whipped up in profit. Exxon is soaking wet in slippery oil profits right now. But here's what Jack and I find fascinating about this situation. It's a funny thing that Exxon didn't do. Exxon refused to say one particular word. Jack and I jumped in T-Boystow.

We're looking through the whole earnings, the earnings call, like everything we can get our hands on. We saw $19.7 billion and we're like, that must be a record, right? But we couldn't see confirmation that it was a record. Because they wouldn't say the word record. Exxon refused to describe their profits as record profits, even though they were.

Now, here's why we think that's a little weird. Companies usually celebrate a record. Like a kid. who lost their first tooth, they will tell it to anyone who will listen. If you lose a tooth, everyone is hearing about that story. Look, bum! The kind of thing you're going to stick up on a fridge, a record. Record profits are like bingo.

When you have it, you say it as quickly as you can. I got the record profit. I got the record. But ExxonMobil CEO wouldn't say record profits. Now, we should point out he did use the word strong to describe the quarter. Interesting choice. Yeah, but describing that quarter as strong is like describing T. Swift's new record-breaking album as merely good. I'm sorry, midnight's changed my life.

Exxon CEO wouldn't even smile last week. Which we find to be hilarious. So, Jack, what's the takeaway for our buddies over at Exxon mobile? Oil companies don't celebrate profits. They whisper them. Yeties, the way our world is set up, oil company gains are actually the economy's pain. The reason for Exxon's record profits is simple. The high price of oil.

Exxon's stock is up 44% since the day Putin invaded Ukraine and sent oil prices popping. In Europe, governments there have raised taxes specifically on oil companies to cash in on those windfall profits. Europeans are down to take some of big oil's money and give it to the cold nervous families over in Europe right now. So over here in the U.S., oil companies don't want to draw attention to their profits right now. Oil companies don't want to be bragging about any records right now. That's why oil companies don't celebrate record profits. They whisper them. A little bit softer now. Jack, can you whip up the Halloween tank? takeaways for us over there. Hershey stock is at an all-time high thanks to its salty, sweet

strategy. It stopped looking in the mirror at itself and started looking out the window at consumers. For our second story, Amazon might make no money over the holidays. So the stock crashed. Say hello to the end of the tech boom. Or just say goodbye. For our third and final story, ExxonMobil's profits tripled thanks to high oil and gas price. They don't celebrate record profits. They whisper them a little bit softer now. Now, time for the best fact yet this one. Sorry, I got some hair in my face. Now, time for the best fact yet.

This one sent in by us, by Nick and Jack. We wanted to whip up the best fact yet for you. Yeah, we kicked off the show wondering what state produces the most pumpkins. Okay, so you'd think California. It's a breadbasket. Maybe New York upstate is pumpkin patch country. Maybe Texas, Jack. You know, like pumpkins, everything's bigger in Texas.

But according to the U.S. Department of Agriculture, the state that produced the most pumpkins produced 650. million barrels? What's the unit of measurement here? It is pounds, and that state is the state of Illinois. That's right. Illinois. More than a quarter of America's pumpkin production

is a fighting al-A-I-Pumkin. Illinois made more pumpkins last year than the next five states combined. Here's why. Unlike most states, which just do pumpkin patches, Illinois mass-produces pumpkins for food. Yeah, not just for photo ops. They're processing these pumpkins in Illinois for pie

filling, ingredients, pumpkin spice flavors. Illinois, the pumpkin patch capital of the world. Yeties, even if you are face deep in a bowl of Reese's right now, you look fantastic. Have a great Halloween. Nick and I'll see you tomorrow. Can't. Before we go, congratulations

to Mitch and Adriana because he got down on one knee and proposed in Milwaukee, and we saw that ring. That's a nice solitaire diamond. More importantly, she said yes. And congrats to Jordan and Katie Smelzer, who are getting married after meeting on a party bus.

Jordan was the driver. Katie was the last minute addition to the bachelor's party. And Caleb is starting a new school down in San Diego. Happy first day, man. Congrats on the new job to Bridget Bush in Reno Nevada. And Erica Appalito got a new job over at TikTok.

And a happy birthday to Keswick Chu turning 25 down in Toronto. Happy birthday to Brandon Ang in Melrose Mass. And a happy birthday to Halle Calavos down in Valparaiso, Indiana. Big thanks to Justine Staffer, who dropped an H-Y-H-T-B-O-Y at our company's all-h-hands call in Chicago. And to anyone else, celebrating something today, make it a T-boy.

Trick or a T-Boy. This is Jack. I own stock of Amazon, and Nick and I both own stock of Apple and Robin Hood, as well as some ETFs of the S&P 500. Now a word about our sponsor, Robin Hood. Jack, rule number one about a kitchen renovation. Tell your friends about your kitchen renovation. We know the cabinets are expected.

Well, in the pandemic, a lot of companies renovated their businesses focusing on apps and digital. Robin Hood didn't have to. It was built digital from the start. Robin Hood's mobile first and intuitive design makes investing a little easier for every stage of your investing journey. Whether you want to trade options, ETFs, or stocks through Robinto Financial, or buy some Bitcoin on Robin Hood crypto, you can do all that right on the Robin Hood app. If you're not investing on Robin Hood yet to get started, go to robin hood.com slash T-boy and choose your free stock. That's Robinhood.com slash TBOI. Limitations apply. Robin Hood Financial LLC, member SIPC, all investments involved risk. By the way, this podcast is not owned by or part of Robin Hood.

We are not employees of Robin Hood. You're going to be like a emo. Oh, that actually is a great one dude for a Who and Whoville. What are you talking about? Kind of like a Who and Whoville Afro. It's like a Who and Whoville made it with a Targaryen. who happens to be their cousin This isn't

Targary it at all I know I think it skips the generation All right here we go