Discover more from Cedar Grove Capital Management

Multi-strategy investment fund focused on L/S, M&A Arb, and Event Driven.

Over 1,000 subscribers

Weekly Recap

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

Don’t Want A Weekly Recap?

As an avid reader and subscriber of other research myself, the last thing I want is to be bombarded with emails that I don’t actually want, i.e. spam. I never want this for you with any of the content that I make.

If you would like to continue getting all my other research (ex, equity research, charts, trade ideas, etc) but not the Weekly Recap, please follow the three-step instructions below.

Click “unsubscribe” at the bottom of this email
Then it will open your email settings and ask which section you’d like to “turn off emails” for
Select “turn off emails” for Weekly Recap - BOOM you’re done

Disclosure: All information provided herein by Cedar Grove Capital Management, LLC (“Cedar Grove Capital”) is for informational purposes only and does not constitute investment advice or an offer or solicitation to buy or sell an interest in a private fund or any other security. An offer or solicitation of an investment in a private fund will only be made to accredited investors pursuant to a private placement memorandum and associated documents.

Cedar Grove Capital may change its views about or its investment positions in any of the securities mentioned in this document at any time, for any reason or no reason. Cedar Grove Capital may buy, sell, or otherwise change the form or substance of any of its investments. Cedar Grove Capital disclaims any obligation to notify the market of any such changes.

The enclosed material is confidential and not to be reproduced or redistributed in whole or in part without the prior written consent of Cedar Grove Capital. The information in this material is only current as of the date indicated and may be superseded by subsequent market events or for other reasons. Statements concerning financial market trends are based on current market conditions, which will fluctuate. Any statements of opinion constitute only current opinions of Cedar Grove Capital which are subject to change and which Cedar Grove Capital does not undertake to update. Due to, among other things, the volatile nature of the markets, and an investment in the fund/partnership may only be suitable for certain investors. Parties should independently investigate any investment strategy or manager, and should consult with qualified investment, legal and tax professionals before making any investment.

Cedar Grove Capital Management