Friday 5: Dollar General's CEO comes back to save the day, Olive Oil & Orange Juice prices at all time highs, Revenge Travel fades away and more...
Is Revenge Travel finally fading away? Why are olive oil and orange juice prices reaching all time highs? Will the bull-case for Dollar General finally play out as its old CEO comes back?
At a Glance
✈️🏖️ Revenge Travel, a post pandemic phenomenon is showing signs of fading, as inflation rises and consumer savings deplete.
💡📈 A light is perhaps at the end of the tunnel for Dollar General as its former CEO comes out of retirement to rebuild the business back up.
🫒🍊 Is the world’s food security increasingly coming under the threat of climate change? Olive Oil, Sugar and Orange Juice prices reach an all time high as producers are battling with weather factors.
🦉🥳 Duolingo’s owl is chaotic, impulsive and passive aggressive and the internet loves him. In fact, Duolingo app users are hosting Duo-themed streak parties and dressing up as the character for Halloween.
🍪🍿 The consumer foods and beverage industry is dominated by just 10 companies. So, the next time you and I go to the supermarket and see a wave of new exciting flavors of snacks and drinks to choose from, remember that the brand we pick is probably owned by one of these conglomerates.
✈️🏖️ Revenge Travel, a post pandemic phenomenon is showing signs of fading, as inflation rises and consumer savings deplete.
The term “revenge travel” started gaining popularity on social media in 2021. “Revenge travel” can mean several things, including taking an ultra-exotic vacation, staying at a wellness center, revisiting a favorite city, or as simple as staying with friends and family a few hours away. Ultimately “revenge travel” is about payback and taking that trip that was lost due to the global pandemic.
“Revenge travel” not just an idea. The Transportation Security Administration (TSA) reports its daily checkpoint numbers and shows that travel numbers have steadily climbed, as countries eased their lockdown policies. Airports worldwide also reported an increase in visitors, especially as vaccines rolled out.
But, is it as good as it is going to get?
The era of unabated “revenge travel” may be coming to a close. A new report by the research company Morning Consult shows that travel intentions are increasing in several countries, but flatlining or falling in others, most notably in Europe.
Intention to travel has dropped 11% points in France and 6% points in Germany since 2022, according to the same Morning Consult’s report that was published in September 2023. Intention to travel also fell in Canada and Russia by 4% points each, as per the survey.
As to whether this suggests pent-up demand is ending: “Yes, our data suggests that is so. But that’s not to say that travel will decline significantly again, but, the majority of those who were waiting to take their “revenge trips” have already done so,” said Lindsey Roeschke, travel and hospitality analyst at the Morning Consult.
On the other hand, Mike Wagner, industry managing director of consumer brands for Acxiom, Interpublic Group’s data solutions division, said that travelers are now being very intentional about planning trips with a specific experience in mind. He is of the opinion that revenge travel has led to plenty of burnout. People are looking to make meaningful memories with more intentional itineraries, without crammed schedules, transit headaches and overall stress.
💡📈 A light at the end of the tunnel for Dollar General as its former CEO comes out of retirement to rebuild the business back up.
Dollar General’s former CEO Todd Vasos is coming out of retirement to help the company, which aims to rebound from slowing growth and allegations of unsafe working conditions.
For my readers here, you know that I have been covering Dollar General DG 0.00%↑stock since its Q2 2023 earnings call and I have outlined the bull and the bear case for the stock. In my Tuesday post this week, I pointed out that the bull case for the stock remained intact with at least 37% upside, given its current valuation. However, I also emphasized that the bull case will only work out only if the management can demonstrate balance sheet discipline and improve their financial outlook in the upcoming earnings reports.
Dollar General: The bull and the bear case for the stock | Part 2
At a Glance Dollar General which has historically outperformed the S&P 500, is down -58% YTD. The reaction however, is fully warranted. As the business revenues slowed and operating income declined on a year-on-year basis, the company took on additional debt to finance its dividends paid out to shareholders. This has ballooned the company’s interest paym…
Well, the news of Todd Vasos coming back into power at Dollar General is certainly a turning point, as the Board is optimistic that Todd would be able to restore stability and confidence in the company moving forward.
Dollar General DG 0.00%↑ shares jumped more than 6% in extended trading on Thursday, October 12, 2023.
🫒🍊 Is the world’s food security increasingly coming under the threat of climate change?
Did you know while US CPI inflation rose 3.7% YoY, prices of orange juice and sugar climbed 23.4% and 16.0% YoY respectively in the US?
Orange juice future prices hit a record high at $3.69 this week. Since 2020, the cost of frozen orange juice concentrate has soared 270% as weather and disease put citrus in short supply.
Florida, the biggest producer of oranges in the US, has been hit especially hard due to the impact of Hurricane Irma and Hurricane Ian in 2022, and the spread of citrus greening, a bacterial disease transmitted by the Asian citrus psyllid insect. Overall, the US Department of Agriculture (USDA) expects a 33% decline in citrus production for the 2022-2023 season, compared to the prior crop year.
In the meantime, price for sugar is also spiking as rising demand is compounded by deteriorating weather outlook. Raw Sugar futures rose to 26.35 cents a pound and reached an 11-year high.
If we zoom out to look at price trends globally for food items, we see that the prices of Olive oil, Cocoa and sugar have also spiked on a year-on-year basis. But, the most notable of them is the price of Olive oil, that has spiked 113% YoY.
Global prices for olive oil surged to $8900 per ton in September 2023, driven by extremely dry weather in the Mediterranean, according to a recent report by the United States Department of Agriculture.
Spain, the world’s largest producer and exporter of olive oil has been battered by an intense drought for months. The country has also just recorded its third hottest summer. According to data from commodity market intelligence firm Mintec, Spain’s olive oil production in the recent season has dropped by more than 50%.
“Adding to the complexity of the situation are concerns about reduced production in the major European olive oil-producing countries, such as Italy and Greece, where drought conditions also prevail” Mintec’s oilseeds and vegetable oils analyst, Kyle Holland said. Greece and Italy are the second and third largest producers of olive oil according to the International Olive Council, an intergovernmental organization made up of members that make more than 98% of olive production globally.
🦉🥳 Duolingo’s owl is chaotic, impulsive and passive aggressive and the internet loves him.
Duolingo owl’s internet virality is unstoppable. The owl has 8 million followers on TikTok, in large part due to its humorously threatening videos, urging users to keep learning on the app. Regardless of whether you have ever used the app or not, you can’t deny that this retargeting message is just savage (and hilarious at the same time)
The virality of Duolingo’s owl is now extending in real life, where users are hosting Duo-themed streak parties and dressing up as the character for Halloween. Recently a member of the Stanford marching band even took to the field dressed as the owl.
The Duolingo social team is known to stay nimble and jump on TikTok trends as they see them. “There’s some campaigns that we work on for months with a production company, but most frequently, we’re quick. We go from ideation to shipping a video in 30 minutes.” After Duolingo was mentioned briefly in the incredibly meme-able Barbie movie, the owl mascot was allowed to walk the red carpet, generating even more social content.
Last week,
and I had written about the business fundamentals of this massively viral language learning app DUOL 0.00%↑ and discussed why they are also adding Maths and Music in their product lines.Duolingo is a language app. Why does it want to teach Maths and Music?
At a Glance Duolingo has built a sensational social media presence since the pandemic started, allowing it to exponentially grow its user base around the world as the app partners with their users on their language learning journeys. “Power users” of Duolingo, who are defined as users who open the app at least 15 days in a month have risen from 20% to 30%…
🍪 🍿You think you have a choice when it comes to your favorite brands of snacks and drinks…Rethink!!
If today’s infographic looks familiar, that’s because it originates from a well-circulated report that Oxfam International puts together to show consolidation in the mass consumer goods industry.
I wanted to share this in light of the post that I published yesterday, where I emphasized how consumer foods and beverage industries are notoriously increasing prices as consumer demand remains resilient in a highly inflationary background. This is obviously helping them boost their business profits as they revise up their financial guidance for FY 2023.
Kellogg's just broke up its cereal business. It now wants to sell you snacks.
At a Glance The Kellogg’s brand is synonymous with cereals. But with the multi-decade decline of their cereal business, the company is branching out into other growth priorities such as cookies, crackers, chips, pretzels & popcorn. A deeper look into the CPG industry reveals how companies in this space are boosting focus on their snacks business, in orde…
Today, these companies are refocusing their efforts to build up their snack innovation pipeline, in response to a growing trend in snack consumption amongst consumers worldwide.
So, the next time you and I go to the supermarket and see a wave of new exciting flavors of snacks to choose from, remember that the brand we pick is probably owned by one of these conglomerates.
Have a great weekend. Thanks all!!!
Amrita 👋🏼👋🏼
I travelled more right after the pandemic than in the rest of my life. Now I’m looking to settle in Lisbon, but I’d love to travel the whole world before I’m old.
I traveled so much when I was touring my whole adult life that buses, planes, trains and automobiles were my home! Lol! I dreamed to stay at home. For me, the last thing I wanted to do was travel following the CV lockdown, but I can certainly understand why people would want to get out and feel freedom again after being imprisoned in their homes during that time.