Most weeks I link up with two smart analysts (@rorycarron and @TMFWillSommers) on Skype for 30 minutes or so to talk shop. Rory is covering stocks for our friends over at Rubicoin and Brendan is getting stuff done for us here at The Motley Fool. These are not service specific talks, just a chance for the three of us to link up and chat. I figured it's easy enough to just keep our notes here for posterity and for anyone else who may be interested. Enjoy!
Zillow
Zillow
- Pull back in the stock price is a bit more valuation related, not as concerned with the actual business but still big questions as to the overall market opportunity. How are these guys not profitable yet?
- Redfin is now a competitor in the public market and while the business model is a bit different (advertising versus online brokerage) it will likely be a worthy challenger to Zillow and could be worth a look as a recommendation at some point.
- Streaming product is a smart idea in that they already have all of the content people want. But can they execute a compelling platform?
- Shows how important and valuable Netflix’s early investments in the space were.
- BBC coming up with its own streaming offering as well.
- Cost argument is becoming less and less relevant over time in the move to streaming. The collection of a la carte apps you may subscribe to for your content may start costing as much as it would be to just subscribe to a cable package.
- Netflix and Amazon are both making big investments in their own children’s content and it’s paying off; the content is good and kids are watching.
- ESPN is becoming a bigger question mark. People valuing time differently, are sports as attractive an entertainment option for younger generations? Are sporting leagues running into a situation where they won’t be able to command as much pricing when contract renegotiations come back around?
- Long road ahead for these guys. Any negative press is crippling regardless of veracity. Perception is reality like it or not.
- Good move on Ells’ part hiring a chief restaurant officer as well as chief communications officer. Both have extensive experience in dealing with restaurants that offer fast food, an area where Ells needs some serious help.
- Chipotle peak earnings was $15 per share in 2015. Perhaps they hit $7.50 in 2017. How long to get back to $15? Can they ever? And if so what’s the multiple on the stock? It likely never gains the premium multiple back, perhaps it’s 30 in better times?
- With this in mind the stock even today as it looks to dip below $300 doesn’t look like a steal.
- Bit of contention between Dick’s and Under Armour as Under Armour continues to develop its relationship with Kohl’s. This relationship is resulting in Kohl’s being able to offer Under Armour gear at lower prices due to the nature of its business.
- Tough road ahead for Dick’s Sporting Goods and Foot Locker, probably not as severe for companies like Nike and Under Armour over the longer haul as they have the brands and the products that people want in the first place.
- Still some questions on Under Armour’s connected fitness acquisitions and potential return on investment.
- CEOs like Plank and Ells tend to paint targets on their backs with their bold statements and outlooks. This can work when things are going well, but when the worm turns it can work against them just as much.
- All in all, the future for Under Armour looks encouraging as long as Plank can learn from mistakes and just focus on growing the business by getting great product out there as opposed to hitting unnecessary benchmarks.
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