Hey Snackers,
Hit the Wheaties with a Made In USA spoon.
You've got Uber's IPO this morning. And fresh US tariff increases on $200B worth of Made In China stuff hit Cinderella-style midnight last night — American/Chinese negotiations continue today, but the trade war officially escalated.
Your Snacks team is on the floor of the New York Stock Exchange today for it all — Follow us @RobinhoodSnacks.
Uber IPOs today: Here's what you need to know
ETA ASAP... 10 years ago, someone watched a car approach via a smartphone map app. Now it's time for Uber's IPO. The OG ride-hailer set a price of $45 for shares to open for trading today (that's a bit on the lower end of the range they expected, which was up to $50 a share). Total company value = $82B.
The "S-1": do it... This tell-all document is required of all companies going public (and should be required reading for anyone thinking of investing). It's like a dating profile for pre-IPO companies. Unlike Tinder, it's not just your top pics with puppies — it's required to be honest and balanced:
- The good: Uber wants to own food and freight delivery, too – Its Uber Eats app has more 5-star ratings on the App Store than Uber (1.4M vs. 888K). And all those tractor-trailer big rigs might get an Uber sticker and start offering you water.
- The bad: Competition. From lots of places. In "personal mobility" alone (ride-hailing, bikes, and scooters), Uber lists 20 competitors, including planned robo-taxi fleets from GM, Tesla, and Google's Waymo. #NotJustLyft
This is 1-star timing... IPOs give us wedding-like vibes — you plan it in advance, and hope anything "beyond your control" won't ruin it. Instead of rain, Uber had to worry about a trade war. New tariffs on China hit last night. And Lyft's poor stock performance (down 37% since its high) doesn't help. There's no "IPO timing" insurance.
A couple craft beer legends merge in $300M deal
Two brewmasters walk into a bar... and they merge operations. Sam Adams-owner Boston Beer Co. is the nation's 2nd biggest craft brewer. IPA-legend Dogfish Head is #13 (the pride o' Delaware). Now they're merging in a $300M deal: The Dogfish husband and wife co-founders earn $127M in Boston Beer stock, while other Dogfish investors get $173M in cash.
Let's just mix them... The brew-mance actually began in February when the two CEOs met at a beer fest in Boston (we approve: one of your Snacks Managing Editors met his fiancée at a VT brew fest). Then they realized how "beautifully complementary" their portfolios are. Adorable. Now they've got two goals:
- "High-end" anything: The duo will keep things artisan, but not necessarily beer — Boston Beer's Angry Orchard cider is a top-performer.
- But stay "legally craft": They'll keep their status as craft, even after they're merged — As long as no more than 25% of either label is owned by a non-craft company.
This is how you take on Big Beer... AB InBev, Diageo, Molson Coors, and other brew-glomerates have bought up craft beers for years (here's where). Corona's Constellation Brands dropped $1B for Ballast Point microbrew in 2015. Two-packed craft beer can fight for shelf space. And it's why Boston Beer's CEO expects "more consolidation in the craft beer industry."
Harry's Shave acquired by Schick owner for $1.4B
This is awkward... Edgewell Personal Care just paid $1.37B for Harry's, the direct-to-consumer guy-and-gal shave company. Investors hated it. Shares of Edgewell fell 16% Monday for a couple other reasons, too:
- Edgewell also reported earnings, and sales fell 10% in the 1st quarter. Edgewell owns your parents' bathroom cabinet: Schick razors, Playtex, Banana Boat, and Wet Ones, among other brands.
- Edgewell's value by market capitalization is just $2.1B. So its acquisition of Harry's was wildly huge considering its size. It'll take on debt and issue new shares to pay for the "combination."
The disrupted just ate the disrupters... Gillette and Schick owned a comfortable, high-profit razor duopoly. Now they kind of do again after acquiring up the companies that disrupted their coziness:
- Procter & Gamble owns Gillette, and then bought Walker & Company's razors for people of color.
- Unilever snatched up Dollar Shave Club last year.
- Edgewell has Schick and Wilkinson Sword (razors with British accents), and now Harry's.
Time to subscript-ify. Everything... The Harry's co-founders impressively convinced a generation to buy a razor and sign up for regular blade/cream refills. It makes sense (most facial hair grows kinda consistently). Edgewell has other products ready for subscript-ify: Body wash, tampons, napkins. Time to Harry-ify them all.
What else we’re Snackin’
- Awkward: Facebook's co-founder (and Zuck's ex-roomie) argues the man has too much power... And their creation is a monopoly that should be broken up
- Run: Nike's new app uses augmented reality to measure your feet and perfect your shoe size
- Flattery: Sears reveals a new logo. Looks a lot like Airbnb's.
- Up: Blue Origin (Jeff Bezos' side hustle rocket company) reveals a moon lander to take humans up by 2024
- Hardcore: GoPro hits 220K active paying subscribers for its service that saves all the action footage you'll probably never watch
- Digestible: Our Snacks crash course on IPOs...