Wally World’s Canoo Trip; On Pepsi, On Pershing, On Peloton…
Tip A Canoo & Walmart Too
Great Ones, who has heard the great commotion (motion, motion) all the country through?
It is the electric vehicle (EV) market rolling on, for EV maker Canoo (Nasdaq: GOEV) and Walmart (NYSE: WMT) too…
And together they’ll build a little van … a van. A van that’s used for deliveries, man. And together they’ll build a little van.
That doesn’t exactly roll of the tongue there, Mr. Great Stuff…
What? It worked for President William Henry Harrison and VP John Tyler back in 1841.
Maybe I need more cider or log cabins? Hmm. But I digress…
In case you haven’t heard, Walmart just signed a “definitive agreement” to buy at least 4,500 (and as many as 10,000) Canoo all-electric Lifestyle Delivery Vehicles — that’s Millennial speak for “vans.”
Apparently, nobody wants to drive a van anymore … and who can blame them?
Minivans bring images of soccer moms and 10-year-old pizza parties to mind — the horror! While regular vans mean you are either an electrician, plumber, cable guy … or a creep with a white van advertising free candy.
They don’t have the best reputation, you know? So, Lifestyle Delivery Vehicle it is.
And Walmart’s ready to deliver that lifestyle in … well, in style?
But not just style, it’s the electric style (boogie woogie woogie). Walmart can do it. It’s electric. Canoo can do it. It’s electric.
Dude, did you take your ADHD meds today?
Who knows? Anywho, I’ve talked about Canoo in these here digital pages a couple of times. Way back in January 2021, I lamented the attack of the EV clones and wondered:
Then in November 2021, I took a much closer look at Canoo and its “skateboard” EV platform design. Basically, Canoo’s EVs are all built on a similar base that includes a battery, motors, steering, brakes, wheels … all the things that make up a vehicle.
This allows Canoo to put whatever it wants on its John Thomas … wait, ignore that, that’s silly. I mean put whatever it wants on top of its skateboard platform — such as a delivery van.
And what a cute delivery van it is. Look at this thing — it’s like a little blue delivery pill designed to help Walmart get your package up and moving and delivered to your door pronto:
Honestly, Great Ones, if you had told me last year that Canoo — of all EV makers — would eventually hit it big with a deal like this, I’d have said you were crazy. I would’ve picked Lordstown Motors (Nasdaq: RIDE) for something like this. (I really need to stop reading Jim Cramer, apparently.)
But facts are facts. And the fact of the matter is that Canoo is on to something here with its modular skateboard EV design. It’s extremely versatile, all-electric and with prices starting in the mid-$30,000s, very cheap by industry standards.
Unless you exclusively wear Eddie Bauer flannels and Ugg boots, you might not dig the Canoo styling… But I’m thinking that the likes of Walmart are more interested in keeping costs down while meeting emissions pledges than looking good.
It sure beats the old creepy white delivery van look, that’s for sure.
Wall Street is certainly excited about Canoo’s prospects now, as GOEV stock skyrocketed more than 80% on the news.
In this risk-adverse market, that’s great commotion (motion, motion) all the country through … indeed.
Of course, you Great Ones know we don’t chase waterfalls or EV rallies around here. But if you are looking for EV tech worth chasing, check this out:
One startup’s new technology is poised to disrupt the $2 trillion car industry. Its light, inexpensive, powerful and quick-charging battery could be the tipping point that finally makes EVs affordable for everyday Americans.
In fact, a Wall Street legend predicts it will cause a 1,500% surge in EV sales over the next four years.
Good: Peloton Problem-A-Thon
Picture this: You’re Peloton (Nasdaq: PTON). You’re the pandemic’s faaaavorite workout tool, because not only can you work out on it — or pretend to — you can also get the social media clout for overpaying for a treadmill.
You can even put out creepy Christmastime ads and not only get away with it but actually get more customers! What’s not to love?
Well … just ask PTON investors.
The pandemic’s crazed demand for Pelotons had PTON investors thinking they caught on to investing in the next Thighmaster, Bowflex, vibrating belt or what have you. And it had Peloton trying to pump out these bikes like they were about to be post-apocalypse currency.
But gone is pretty much all of Peloton’s demand, and with it, the company’s need for in-house manufacturing. Wait, did I say “need” for in-house manufacturing? I meant “ability to pay for production.”
Peloton announced it’s outsourcing all of its bike-making biz to its production partners, instead of relying on both in-house and outsourced manufacturing. No sense bleeding two pigs dry, eh? According to interim CEO Barry McCarthy:
You mean the “flexibility to not go bankrupt?”
What else could Barry McCarthy even tell PTON investors to help comfort them at this point? “Y’all bought into a fad?” The stock’s down 94% off its all-time highs and still has room to fall further. That’s the secret — you can always fall further.
Granted, killing one supply chain makes sense now that the pandemic issues are not fully there anymore. But that’s assuming Peloton is smart enough to think of that, and judging from what I’ve read so far, nothing like that was a driver in this decision.
It’s kinda like saying: “Hey, I don’t have to do any more oil changes … because I just set my car on fire.”
Better: Taste Just Like Pepsi Cola
C O L A cola! Co co co co cola…
Who knew that being a snackaholic would pay off?
All you Doritos munchers and Gatorade gulpers just helped Pepsi (Nasdaq: PEP) kick off earnings season in style. Anybody hankering for a double-beat report?
Oh! Me! Me!
Earnings and revenue both beat expectations with room to spare, but margins took a direct slap to the face with literally everything getting more expensive now. And Pepsi’s $1.17 billion charge from the Russia-Ukraine fallout didn’t quite help on that front.
Key sales this quarter? You guessed it: Doritos and Gatorade, the breakfast of champs. (Move over little chocolate donuts!)
For his part, Pepsi’s CFO is rather nonplussed about the whole shebang:
That sounds rad from an investing point of view, until you realize that those cost-saving measures mean you, the consumer, are picking up the slack.
Everybody’s talking ‘bout inflation, stagflation, deflation, this -flation, that -flation … but all I’m saying is give shrinkflation a break! Has the American public not suffered enough?
In its ever-waging war to keep up with current demand and current prices, Pepsi is doing what snack companies have done since time immemorial: give you less for more.
A whole bunch of your favorite products are gonna start having “new look, same great taste!” packaging, but you best believe my eye is on that shrinking net weight. You dare rob me of my spicy sweet chili Doritos? Oh nay nay.
They don’t think it be like it is, but it do.
Umm, sure, whatever you say. Basically, don’t be shocked to see shrinkflation in Pepsi’s margins if you’re a PEP investor and your snacks if you’re a consumer … which should be all of you. Yes, even y’all vegan jerky eaters.
Best: It’s Hip To Be Pershing Square?
Elon Musk … Bill Ackman … 15% of all homebuyers … who isn’t trying to back out of a deal this week?
Umm, me. I’m being fiscally responsible over here and getting no recognition for it!
What do you want, a gold star? Hey, take comfort in the fact that you’re not Bill Ackman, who had to tell his Pershing Square Tontine (NYSE: PSTH) investors that there’s simply … no deal for the SPAC. None. Zero. Ugatz.
Hey, at least PSTH investors will get their money back … unlike many other SPAC holders during the pandemic (sorry, not sorry).
The SPAC had raised over $4 billion amid the tech market’s uber hype over the past few years — well, at least until the pandemic crash derailed hopes of finding the right acquisition target. Or as Ackman puts it:
I see his point — have you tried stock-hunting lately? I mean, there’s a reason why we trust the options traders over at Trade Kings … just saying.
Thing is, while surely this is a disappointment to PTSH holders who had their hearts set on SPAC-tacular gains and nabbing some previously unobtainable private stock … this news is actually a breath of fresh air for hedge funds.
Better to have no deal than a rushed, forced, unprofitable deal, am I right? And what screams rushed and forced more than Pershing Square’s previous plans to … *checks notes* … buy a 10% stake in Vivendi’s Universal Music spinoff?
It’s one of those deals that seemed somewhat questionable-but-doable at the time, but is now unimaginable in a post-pandemic world.
You have a hyped-up SPAC that tries to find a unicorn in the market’s rough, fails to seal the deal with any company, resigns to buying some spinoff no one wanted … and then hits regulatory hurdles for the deal that no one wanted.
Yeah, I’d pick “no deal” myself, Howie.
And Now For Something Completely Different…
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