Consumer & Retail Report #7: 8/21 Recap

Summary of the Week in Consumer and Retail

Paul Cerro

Aug 21, 2022

Welcome to our Consumer and Retail recap where we share noteworthy headlines, updates, and insights. Never spam.

Company Announcements

Carnival (CCL) updates COVID protocols, no testing for vaccinated guests (Release)
Starbucks (SBUX) asks labor board to halt union votes temporarily (AP)
Walmart (WMT) to offer Paramount+ streaming at no cost (Press Release)
Electronic Arts (EA) authorizes a new program to repurchase up to $2.6 bln shares of its common stock (Street Insider)
Apple (AAPL) will make Apple Watch in Vietnam (Nikke)
Amazon (AMZN) warehouse workers in Albany, NY filed a petition to hold a union election (Bloomberg)
Home Depot (HD) authorizes a new $15 bln share repurchase program, replacing its previous authorization (Morningstar)
Madison Square Garden (MSGE) Board of Directors approves exploration of potential spin-off (Businesswire)
Cineworld Group Plc (CNWGY), the owner of Regal Cinemas, is preparing to file for bankruptcy (WSJ)
Bed Bath & Beyond (BBBY) has hired law firm to help it address a debt load that has become unmanageable (Bloomberg Law)
Wayfair (W) announced a workforce reduction involving approximately 870 employees (SEC Filing)
DoorDash (DASH) is ending its partnership with Walmart (WMT) next month (Business Insider)
Jack In The Box (JACK) aiming to sell at least 250 restaurants to franchisees (WSJ)

Corporate Shakeups

New York Times (NYT) taps Bank of America amid ValueAct challenge (Reuters)
Third Point discloses stake of nearly $1 bln in Disney (DIS), pushes for changes (Reuters)
Home Depot (HD) elects CEO and President Ted Decker as Chair of the Board, effective Oct. 1, 2022 (PR Newswire)
Foot Locker (FL) appoints former Ulta Beauty (ULTA) head Mary Dillon as CEO (Reuters)
Starbucks (SBUX) chief operating officer John Culver to exit company as COO position is eliminated (Nation’s Restuarant News)
Ryan Cohen has officially sold out of Bed Bath and Beyond (BBBY) and made a crisp $60 million in profit while doing so (SEC - RC Ventures / SEC - Ryan Cohen)

MuddyWatersResearch @muddywatersre

Let us bow our heads and remember that ⁦@ryancohen⁩ likes to complain about short sellers.

M&A Updates

Nerdy (NRDY) Acquires Coding Education Startup as Demand for Computer Science Education Grow (Businesswire)
Reebok owner Authentic Brands strikes $254 million deal for Ted Baker fashion brand (CNBC)
IKEA to liquidate Russian unit as part of sanctions-led pullout (Reuters)
Keurig Dr Pepper (KDP) says it is not looking to buy Bang Energy maker (Reuters)

Financing Updates

Bark (BARK) files prospectus related to the issuance of up to 4.6 million shares of common stock (SEC Filing)
(Old but interesting) Reborn Coffee aims for $6 million IPO (Seeking Alpha) - **on my radar to investigate as a potential short**

Insider Buying/Selling

Buys

FIGS (FIGS) Director purchased 10,000 shares at $12.38-$12.76 worth ~$125k (SEC Filing)

Sells

O’Reilly Automotive (ORLY)
- CEO sold 300 shares at ~$750.19 worth ~$120k (SEC Filing)
- EV Chairman of the Board sold 11,500 shares at $728.13 worth ~$8.4 mln (SEC Filing)
- Director sold 5,000 shares at $739.38 worth ~$3.7 mln (SEC Filing)
Dutch Bros (BROS)
- CEO sold 71,125 shares at $45.73-$47.23 worth ~$3.3 mln (SEC Filing)
- CFO sold 85K shares at $45.79-$47.25 worth ~$3.9 mln (SEC Filing)
- COO sold 12,000 shares at $43.74-$45.51 worth ~$538k (SEC Filing)
Groupon (GRPN) 10% owner, Maple Rock Capital Partners Inc. sold 498,989 shares at $12.22-$13.74 worth ~$6.6 mln (SEC Filing)
Trupanion (TRUP) EVP of Legal sold 1,600 shares at $80 worth ~$128k (SEC Filing)
e.l.f. Beauty (ELF)
- CEO sold 68,344 shares at ~$38.01 worth ~$2.4 mln (SEC Filing)
- Director sold 12,852 shares at ~$37.54 worth ~$482k (SEC Filing)
Kraft-Heinz (KHC) VP, Global Controller sold 26,456 shares at ~$38.63 worth ~$1 mln (SEC Filing)

Macro Updates

U.S. Retail Spending Held Steady in July (WSJ)
- The takeaway - Overall retail sales—a measure of spending at stores, online and in restaurants—were flat in July compared with the prior month’s revised 0.8% increase. But a measure of spending that strips out gasoline and auto sales rose 0.7% last month from June, showing shoppers maintained the ability to spend with much of the spending moving online.

Until next time,

Paul Cerro | Cedar Grove Capital

Personal Twitter: @paulcerro

Fund Twitter: @cedargrovecm

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