Hey Snackers,
Zuckerberg's got a secret $59M Lake Tahoe compound (buying through a limited liability company = discrete).
Markets are more focused on April's big jobs report due out Friday morning.
The Taser CEO gets paid $246M (only if his company does reeeeally well)
Tasers are having a moment... Nationwide focus on police conduct has departments buying up Tasers, body cameras, and software to upload the footage. Taser inventor Axon Enterprises makes all that, and just granted CEO/co-founder Patrick Smith $246M in compensation — 20x the pay of a normal (still very rich) big company CEO. But read the fine print...
Dangling million dollar carrots... The board wants Smith to capitalize on the Taser era. So they've set up performance-based targets that will turn his stock options into real dollars:
- Stock price: All the Axon shares out there are worth $3.8B total right now. There are 12 "market cap" milestones that will convert his options to cash money as it hits points on the way up to $13.5B.
- Revenues: They're currently at $400M. If it reaches $2B, Smith will score 8 separate stock option bonuses.
- Profits: Yup, there are 8 more prizes based on profitability targets.
Smith's living on the edge... Although technically (based on accounting rules) he got "paid" $246M this month, it was all in stock options — Those have no value unless they "vest" (aka hit those goals above). His current salary is just $24K. He doesn't get rich unless his company does too.
Beyond Meat surges 163% on record IPO day
Compliments to the chef... Beyond Meat enjoyed the biggest 1st day jump of any stock since 2000: +163%. Shares of the plant-based protein pioneer actually surged so fast they had to be halted by Nasdaq. Despite just $90M in annual revenues, Beyond is now worth twice as much as all of Shake Shack ($3.8B vs. $1.8B).
It's all about reducetarians... Not vegans. A Nielsen survey says just 6% of Americans are vegetarian, and half that are veganites. But 39% now crave to eat more plant-based foods and less animal-based ones. Beyond's pea-based protein strategy is targeting those meat "reducetarians."
- Grocery stores (58% of revenues): Beyond's sold in 15K so far — And 93% of Kroger customers who bought the Beyond Burger also bought animal meat.
- Restaurants (42%): Beyond Burger is served in 12K restaurants that also offer plenty of beef — Carl’s Jr., TGI Fridays, and BurgerFi.
A big IPO isn't necessarily a successful IPO... Beyond Meat issued 9.5M raw, new shares to brand new investors this week to raise money to grow. Naturally, it aimed to sell at the highest price. Thursday's insane jump though shows it under-priced the shares and could have raised more money:
- $25/share: That's the price at which Beyond Meat issued shares = $238M raised.
- $68.70/share: That's the price after Day #1 of trading = $653M potentially (but not) raised.
- $415M: that's how much money Beyond Meat "left on the table" by IPO-ing at a share price that seemed to be too low.
Activision Blizzard still can't beat Fortnite
Free-to-play video games... are the arch-enemy of pay-to-play companies like Activision Blizzard. The gamer's 1st quarter revenues fell 8% from last year — And since gaming juggernaut Fortnite (owned by private company Epic) took over social lives beginning July 25, 2017, Activision's stock is down 28%.
🎮 Q1 Lowlight: Monthly active gamers dropped to 345M from 374M last year.
Pwnd by Fortnite... Activision's new games aren't impressing, so it's trying out different ways to win:
- Make addicting games: Average time spent by customers on its games was 50 minutes per day last quarter.
- Learn to play their game: Fortnite trained a generation of players to pay money for extra, in-game features (virtual players need costumes) — But those sales actually fell for Fortnite from $1B to $800M.
- Build stadiums: Overwatch League (a pro e-sports tournament) depends on live-gaming with live fans of Activision's popular battle game. It's launching Call of Duty League soon, too.
Gamers need to stay focused... To deal with shrinking revenues, Activision already laid off 750 employees this year to cut costs. The still-active Acti-visionaries (new nickname) are working on its top games only — Call of Duty, Overwatch, and Warcraft — which are on their last lives. Others are already Game Over (RIP, Destiny).
What else we’re Snackin’
- Flip: Shake Shack shares hit 7-month high (and it's opened up in China and Rhode Island)
- DVR: Sinclair buys up Fox sports channels from Disney for $10B
- Well: Weight Watchers jumps 15% as it announces it'll lean more on Oprah for 2019
- Raising: Tesla's selling $2B in stock and debt to raise more cash — And Elon's buying $10M shares
- Hiring: Facebook closes in on a settlement with the FTC to stick a privacy-focused exec at the company's "highest levels"
- Virgin: Berkshire Hathaway (Warren Buffett's firm) buys shares of Amazon for first time
Friday
- The big April jobs report
Disclosure: Authors of this Snacks own shares of Beyond Meat, Tesla, and Amazon