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BBQs Cook Fish, Too – Beware the Weber, Traeger IPOs

BBQ company insiders are trying to put all you fish directly onto hot coals via their IPOs.

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As we all know, Covid-19 policies have created an interesting array of winners and losers. Restaurants, travel and mall-based retail? Wah, wah. Meanwhile, any company remotely tied to housing, remodeling or recreation has been on absolute fire.

So what if your traditionally slow-growth, low-margin business suddenly had its best year ever by a wide margin? You’d probably think very seriously about trying to sell it.

That is exactly what is happening with the spate of BBQ-related IPOs that are about to pour onto this market.

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Are the upcoming initial public offerings of Traeger Pellet Grills and Weber good ideas for your investment portfolio? Be very careful.

First, it’s highly likely they’ve taken the route of public markets because they have nowhere else to go. Truly, who is Traeger’s logical acquirer? In a bygone era, Sears might have represented a possible exit but such buyers no longer exist. Maybe one of the few large competitors in this highly-fragmented industry like Weber? Whoops – they’re going public, too!

Focusing on Weber, what a story they seem to have on their hands, being able to claim 6-month revenue growth rates of over 60%! Wow!

Problem is, IBIS says annual growth of the bbq industry over the last 5 years averaged 4.7%, which means Weber caught lightning in a bottle thanks to this pandemic and they’re trying to cash in. Same with Traeger.

Unfair assessment, you say? Then why are roughly 2/3 of Traeger’s IPO shares being sold by insiders? That’s right, only 1/3 of this offering is to raise working capital for the company. The rest is insiders cashing out.

Hey, I’ll be the first to admit that Traeger grills are pretty cool. And these are familiar names so they may catch a bid based on that familiarity for a while, particularly if this housing market keeps steaming ahead. But by no means are these 10-year investments. If you just can’t help yourself and absolutely have to play with these shares, think more in terms of 10 weeks. Or 10 days.

Truly, how much longer can the explosive growth in our world of economic distortions last? Regardless, is there any way companies like this are going to keep posting 50%+ growth numbers? Pfffffffff.

Heck, as recently as 2019, Weber’s y-o-y revenues declined by 3%. That’s the nature of this industry – a little growth here, a little step back there… slow, stodgy, boring.

Even in Weber’s bounce back year of 2020, when revenues rebounded 15% compared to the prior full year? They made a paltry $88 million on $1.5 billion in revenues. Those are grocery store margins.

Yet despite this industry’s historically slow growth and non-existent margins, Weber’s market cap at IPO next week will be roughly $5 billion, meaning the shares will trade with a P/E of close to 60 like they’re some high-flying tech unicorn! Truly amazing stuff, but par for the course in today’s everything bubble.

As an aside, by the way, don’t even think about looking elsewhere in this sector, like to VELO and its recent announcement that the SPAC is taking BBQ Guys public. Does anyone recall what happened to BBQ retailers in the last economic downturn? If the phrase, “buh-bye,” doesn’t come to mind, you simply weren’t paying attention.

Make no mistake, all these BBQ industry IPOs are ‘greater fool’ investments at their finest. Sorry, but you’re the dumb money the insiders and their private equity backers are asking to buy their shares after one-time growth surges that probably surpassed even their wildest imaginations.

There’s an old saying in poker: if you look around the table and can’t figure out who the fish is, you’re the fish.

In this case, the BBQ company insiders are trying to put all you fish directly on their hot coals.

No, thanks. I’ll have a salad this time instead.

 

P.S. Yes, this is a new pen name but you probably know me. I’ve a new Twitter profile, too… please consider giving me a follow their and we’ll get this train rolling.

Photo by Martin Boose from FreeImages

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Americans sense things are on the wrong track, and have been for quite some time. Among our many challenges, for example: It can no longer be denied that income inequality is skyrocketing. But it is not capitalism that is enriching the few while slowly impoverishing the many. It is America’s long, slow turn away from free markets -- and the vital medium of exchange that underpins them -- that’s doing us in. This pseudonym is a nod to a somewhat-fringey, indulgent personal suspicion I hold with a 1% probability of being accurate: Alan Greenspan never ceased being Ayn Rand’s “man in Washington.” What if the well-known central bank chairman put on the show politicians wanted from him for years, all while secretly trying to return this world to rationality? Instead of destroying copper like D’Anconia, however, Greenspan destroyed money. Without realizing it now, some of you know me but I write under this pen name for two reasons. First: Of all the potential tyrannies we face today, by far the greatest threat to America is the misunderstanding, and therefore the ongoing destruction, of the U.S. dollar. Second: I write with the hope my ideas will stand on their own, aside from any political party, even apart from my own considerable charm and personality. Love me for my ideas, not because I'm beautiful. Politics, markets, more ... the things on which I’m qualified to opine will be unveiled here over time.



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Business

On the Path to Achievement, Everyone Starts Someplace

The world is full of people who followed a sequential approach to achieving fabulous goals

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Do you feel some days as if you’re making little or no progress on your chosen goal? If so, take heart: The world is full of people who followed a sequential approach to achieving fabulous goals. In other words, they went from one accomplishment to the next, almost in step by step fashion, and you can do the same.

Words and Deeds

In publishing, here are two individuals who achieved one notable goal, and then built upon that achievement in accomplishing something even loftier.

Michael E. Porter, Ph.D., wrote the acclaimed text Competitive Advantage, detailing how corporations and organizations could identify their strategic assets and use them to establish a market niche. Years later, Porter wrote The Competitive Advantage of Nations, a blueprint for governments to have more viable economies.

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The late Stephen Covey, PhD, conducted seminars for corporate leaders and eventually wrote the bestseller, The Seven Habits of Highly Successful People. Covey then established his own publishing house, created and spun off his own literary agency, and developed proprietary products such as calendars, newsletters, software products, and guidebooks.

He wrote several more best-selling books and produced video programs distributed worldwide. His influence continued to the far reaches of the globe, and The Seven Habits of Highly Successful People is now used in classrooms.

Words and Scenes

In the motion picture industry, the process works much the same way. Jodie Foster was first a childhood actor, then an accomplished actor, the winner of two Academy Awards, then a director, and then a director/producer.

Others who established careers as actors first and then became successful directors and/or producers include Warren Beatty, Robert Redford, Clint Eastwood, Kevin Costner, Mel Gibson, Barbra Streisand, Ron Howard, Danny DeVito, Tom Hanks, George Clooney, Tom Cruise, Natalie Portman, Drew Barrymore, Brad Pitt, and Ben Affleck. Penny Marshall and Rob Reiner, once husband and wife, were successful television sitcom actors who achieved star status as major motion picture directors, much like Ron Howard.

In his twenties, Steven Spielberg directed the film, Sugarland Express, starring Goldie Hawn. Though few people saw the movie, it received critical acclaim. A year later he directed Jaws, and two years later, the start of the Indiana Jones trilogy.

One Step at a Time

The path to fame and fortune among directors is largely made from one film to the next. The takeaway: Everybody starts somewhere

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Business

Corporate America’s Grand Social Engineering Scheme

Board rooms are flooded with wokesters who seek to skew reality

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A while ago I wrote an article about an apparent grand social engineering scheme, now at least five years running, hatched by corporate America. Since then the situation has accelerated, hence this end-of-the-year update.

To begin, in viewing the ever-lengthening list below of companies and products below, do you discern any common denominator?

ADT, Amazon, American Express, American Home Shield, Amex Travel, Aplus.net, Anheuser-Busch, Armorall, Aplus.net, AT&T, Axe Ice Chill, Bank of America, Behr Ultra, Best Buy, Blue Cross and Blue Shield of North Carolina, Bombas Underwear, Booking.com, Bud Light, Cadillac, Calvin Klein, Capital One, Carolina Keno, Casper Mattresses, Celebrity Cruises, Centrum Silver, Champion Windows, Chase, Cheerios, Choice Hotels, Cinemark, Clearblue, Coors Light, Corolla Cross, Corona Seltzer, Cricket, Credit Karma, CRS Temporary Housing, Dawn, Dell Technologies, DirecTV, Disney Cruise Lines, Domino’s Pizza, Ecolab Science, Entresto, Entyvio, Expedia, Experian, Fidelity, Freshly.com, GEICO, GetRoman, GlaxoSmithKline Trelegy, Glidden, Grammarly, and Grand Wagoner.

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Also, Hagerty, Harris Teeter Supermarket, Heineken, Home Depot, Honey Maid, Humira2, Hyundai, Ikea, Ingressa, Intel, Joybird Furniture, JP Morgan, Just For Men, Kay Jewelers, Keebler, Kesimpta, Kia Motors. Kohl’s, Latuda-Lupin Pharmaceuticals, Liberty Mutual, Lincoln Financial, LL Flooring,  Love Sac Furniture, Macy’s, Marriott Bonvoy, McDonald’s, Mercari, Michelob, Michelob Golden Light, Michelob Ultra, Miller Lite, Mountain Dew, My GMC Card, NBA.com, NerdWallet, Nestle’s, Nioxin, Nissan, Nissan Versa, Notre Dame University, Ocrevus-Genetech, Old Navy, Olive Garden, Opendoor, Otezla, Pepsi, Polident, Prevnar 20, Progressive Insurance, Public Broadcasting System, Rayban, ReMAX, Rocket Mortgage, Rooms to Go, Royal Caribbean Cruise Lines, Rybelsus, and Saga River Cruises.

Add in Samsung Galaxy 21, Serta Arctic, Smile Direct Club, Smithfield Foods, Sonic, Spectrum Business, Spectrum Originals, Starbucks, State Farm, Subway, SunglassesHut.com, T-Mobile, Taco Bell, Tahoe South, TalkItOutNC.org,Target, Terminex, Tide, TheRocketAdvantage.com, TJ Maxx, Tommy John Underwear, TouchOfModern, Toyota, Travel Oregon, VacationsToGo, Valspar Paints, Vanda Pharmaceuticals, Visit Albuquerque, Visit Florida, Vivint Smart Home Security, Vizzy Hard Seltzer. Walmart, Wayfare, WeBuyAnyCar, WellCareWells Fargo, White Claw Hard Seltzer, Wimbledon, Vacasa, Volkswagon, Vroom.com, and Zeluja.

A Campaign Unlike All Others

No clue? Every single entity above features television commercials or web advertisements with a black male paired with a white female. Most couples appear to be married or part of a long-term relationship. Or, the pair appears to dating.

This past spring, Michelob launched a commercial, unique in its approach to selling beer. A petite, highly attractive red-headed woman, in an extremely short tennis dress, holding two bottles of Michelob, dances along a tennis court, in a highly suggestive, sexually alluring fashion. At mid court, she hands her black male partner one of the bottles, and they toast.

Nothing to see here, undoubtedly in everyday life, we’ve all witnessed very attractive redheads in decidedly short tennis skirts do a highly suggestive, sexually charged dance on the way to their male partner. Oh, you haven’t?

Skewing Reality

The incidence of mixed race couples in society has been on the increase since the 1970s. Nevertheless, since blacks represent less than 13% of the U.S. population and black men represent roughly 6% of the population, it is a statistical anomaly that so many TV commercials feature such a pairing, with white males out of the picture.

An ever-expanding array of woke advertisers apparently need to re-affirm their virtue signaling. Amex Travel, Armorall, Bank of America, Blue Cross and Blue Shield of North Carolina, Capital One, Entresto, Entyvio, Freshly.com, Home Depot, Kay Jewelers, Michelob, Otezla, Progressive Insurance, Sonic, Starbucks, T-Mobile, Taco Bell, Toyota, and Wayfare feature at lease two different TV commercials, with each pairing a black man with a white woman and, in some cases, in a car with white children in the back seat.

In one Nestle’s commercial, the white wife of a black husband aggressively tells us her first name. One particular GetRoman commercial features two different pairings of a black man and a white woman, as does a particular Rocket Mortgage commercial. Rybelsus features two different black male white female parings in the same TV ad.

Ubiquitous, to Say the Least

Black man — white woman commercials are now so ubiquitous that in some cases you’ll see such TV commercials back-to-back, and occasionally even back-to-back-to-back. Might the unassuming, casual viewer wonder, “What’s going on here?” Who decided to engage in mass social engineering?

Samsung, Budweiser, Trojans, Grey Goose Vodka, and PNC Bank depict a more casual relationship between a black man and a white woman. In other cases, only fleeting glimpse of such couples are offered, as with Google, JCPenney, Nissan, and Busch Garden commercials. Travel Oregon employs black man — white woman claymation figures to lure potential vacationers.

In one Amazon TV commercial, a black man is brushing his teeth as a white woman sticks her head out of the shower and says, “That’s a low price.” Two children, one black and one white, are all in the bathroom with them at the same time.

Unlike Anything You’ve Seen Before

A Bombas underwear commercial ends showing the backsides of a white woman and black man each in the their underwear, holding each other, in a risque pose, unlike anything you’ve ever seen in a TV commercial.

Aleve features a white woman with a black child on her shoulders. Zeluja shows a gleeful grandmother accompanied by her two mixed-race grandchildren on a boat around the lake. Eyemed features an early 30s white woman embracing her apparent mixed race son. LL flooring features a couple lying on a hardwood floor. The white woman says, “I love you Steve” and then the black man says, “I love you Steve.” It turns out the flooring salesman is named Steve.

In a Starbucks commercial — you know, the company headed Howard Schultz, who proudly proclaimed in 2017 that he was going to hire 10,000 refugees over the next five years and was upended by a populist backlash that sought to know why he didn’t proclaim the quest to hire 10,000 U.S. veterans — a black man and a white woman enter a Starbucks, about to hold hands, for apparently the first time. The commercial’s closing sequence reads, “Starbucks, your happy day is here.”

Scenarios Unprecedented

Anyone can be in love with anyone, and certainly anyone can be in a relationship with anyone. What is unfolding in corporate and ‘progressive’ America, however, that results in the extreme over-accenting of mixed race couples? Note that Hispanics and Asians generally are not part of this phenomenon.

When a black man in a TV commercial is actually paired with a black woman, she always has lighter skin. If a black man is featured with his apparent children, they always have much lighter skin, leading to the conclusion that the mother is white, such as with Truist Bank, Chevy Bolt, and Blue Cross of North Carolina. In many cases, the darker complexion for the man, the lighter complexion for any offspring. Is the underlying message that dark-skinned women are undesirable?

With T-Mobile, a white woman wearing a wedding ring is resting her head in the lap of a black man. I’ve been watching television for 60 years and have never seen such poses depicted in any TV commercial with a white husband and wife, or a black husband and wife. For some reason, however, today’s corporate entities feel compelled to show us a black husband and a white wife in amorous scenarios unprecedented in television advertising history.

Likewise, GetRoman.com offers an exceedingly bold, racy TV commercial that leaves nothing to the imagination with a black male stating, “Sometimes you’re not ready,” whereupon his white female partner, in a skimpy black dress and high heels proclaims, “We’ve got this,” and they march off to the bedroom.

Abroad and in Print

Ethnic Europeans, who comprise more than 90% of the continent, are puzzled by what they see as an anti-white propaganda campaign conveyed through television commercials. The promotion of mixed race relationships, with a white woman and a black man, in particular, has become so commonplace that even unobservant viewers have noticed.

Magazine and website ads in the U.S. such as DiscoverTheForest.org, by the U.S. Forest Service pairs a black man and a white woman holding hands as they strolled through a forest with two mixed-race children proceeding them. Fidelity Investments features a black man and a white woman leaning on a railing, staring at the horizon, in the planning for their retirement. Farmbox, BathFitter, Jonathon Paul Fitovers, and OTC Network follow the same pattern.

What is the end game behind interracial commercials? Are corporate board rooms flooded with wokesters who feel compelled or coerced to skew reality in this particular way?

Show us the Sales Data

Since corporate advertising is specifically designed to bolster product and service awareness and, ultimately, revenue, do such companies believe that black/white pairings will help them with their sales? I’d be interested in seeing their data.

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