US shares

[TheMotorcycleBoy]

Anyone have a view on either of these?

Eli Lilly And Co NYSE: LLY
Hershey Co NYSE: HSY

I know little of LLY. Of HSY, I know of lots and lots of brands of yummy sweeties (they acquired Cadbury's didn't they? )

Matt

[SalvorHardin]

Anyone have a view on either of these?

Eli Lilly And Co NYSE: LLY
Hershey Co NYSE: HSY

I know little of LLY. Of HSY, I know of lots and lots of brands of yummy sweeties (they acquired Cadbury's didn't they? )

Don't know anything about these companies, except that Hershey has long been talked about on The Motley Fool about as an ideal acquisition for Berkshire Hathaway. Also Hershey is controlled by a trust established by its founder.

I can help with Cadbury's, which was bought by Kraft. When Kraft was split into Kraft Foods and Mondelez, Cadbury's went with Mondelez.

Mondelez got the better (and more international) brands in the split. Kraft merged with Heinz and the new management then ran the company into the ground by sacking people who knew what they were doing and replacing them with (cheaper) people who didn't.

[TheMotorcycleBoy]

Anyone have a view on either of these?

Eli Lilly And Co NYSE: LLY
Hershey Co NYSE: HSY

I know little of LLY. Of HSY, I know of lots and lots of brands of yummy sweeties (they acquired Cadbury's didn't they? )

Don't know anything about these companies, except that Hershey has long been talked about on The Motley Fool about as an ideal acquisition for Berkshire Hathaway. Also Hershey is controlled by a trust established by its founder.

I can help with Cadbury's, which was bought by Kraft. When Kraft was split into Kraft Foods and Mondelez, Cadbury's went with Mondelez.

Thanks. Though, looks (after a few minutes googling), that several seem to have a claim of some kind on the brand "Cadbury".

I'm getting the impression Hershey have a license to manufacture Cadburys in the US:

https://en.wikipedia.org/wiki/Cadbury#United_States
https://www.thehersheycompany.com/conte ... report.pdf (page 2)

Matt

[monabri]

Cadbury brand is owned by Mondelez. Hershey have a licence to produce certain products in the US . They also have a licence for some Nestle products (eg kit kat)

[TheMotorcycleBoy]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

thanks Matt

[ADrunkenMarcus]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

Historic metrics look good. Current free cash flow yield of 4.4 percent, average ten-year CROIC is 25.2 percent and ROCE is 34.6 percent. Don't ask me about the future!

Best wishes


Mark.

[TheMotorcycleBoy]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

Historic metrics look good. Current free cash flow yield of 4.4 percent, average ten-year CROIC is 25.2 percent and ROCE is 34.6 percent. Don't ask me about the future!

Best wishes


Mark.

Yes. I'm still trying to figure them out.

EPS and FCFPS grew by about 12% on average 2016-2021. Sales only by 6.5%. More worrying DPS growth (22%) has out stripped EPS growth.

Their net equity went negative from 2019.

They have a new CEO https://www.bloomberg.com/news/articles ... management who's suspending stock BB in favour of investment in stores and staff. Which is good news for me, but the market seems worried about margins as a result.

They (SBUX) are currently fighting a union battle. I don't fully understand the pros and cons TBH.
https://www.cnbc.com/2022/04/21/starbuc ... -away.html

I'm currently trying to weigh up whether to start a new position here with SBUX or top up Maccies.

Matt

[ADrunkenMarcus]

I'm currently trying to weigh up whether to start a new position here with SBUX or top up Maccies.

Matt

I've found it a helpful discipline to top up existing holdings first before adding others. I'm worried about 'deworsification'!

Best wishes

Mark.

[monabri]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

thanks Matt

https://seekingalpha.com/article/450294 ... m=referral

Not read the article....it's dated 22 April 22. Might be of interest.





‐--------Separately, Simplywallstreet states ROCE at 25% ( down from 26% three years ago).

Negative equity....debt 14.8bn USD versus negative 8.45bn equity. something happened 2018...no idea what!

https://simplywall.st/stocks/us/consume ... #valuation

[TheMotorcycleBoy]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

thanks Matt

https://seekingalpha.com/article/450294 ... m=referral

Not read the article....it's dated 22 April 22. Might be of interest.





‐--------Separately, Simplywallstreet states ROCE at 25% ( down from 26% three years ago).

Negative equity....debt 14.8bn USD versus negative 8.45bn equity. something happened 2018...no idea what!

https://simplywall.st/stocks/us/consume ... #valuation

The negative equity derives from from buying back a massive amount stocks through from FY2017-FY2019. If you look in the 10k for FY2020 at the cash flow statement you can see it.

Matt

[DelianLeague]

Anyone have a view on either of these?

Eli Lilly And Co NYSE: LLY
Hershey Co NYSE: HSY

I know little of LLY. Of HSY, I know of lots and lots of brands of yummy sweeties (they acquired Cadbury's didn't they? )

Matt

LLY shares have had slow and steady growth for many years and also pays a quarterly dividend. They used to be my preferred big Pharma share. I paid $37 for them many years ago and held on to them. Boring but reliable. I have no idea what their pipeline is like now but I seem to remember that they made an acquisition lately that the market liked. Two of their old products that spring to mind are Prozac and Cialis, both huge sellers.
I think they still have a presence in the UK in Speke and in Hampshire.

Regards, D.L.

[simoan]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

Historic metrics look good. Current free cash flow yield of 4.4 percent, average ten-year CROIC is 25.2 percent and ROCE is 34.6 percent. Don't ask me about the future!

Best wishes


Mark.

Yes. I'm still trying to figure them out.

EPS and FCFPS grew by about 12% on average 2016-2021. Sales only by 6.5%. More worrying DPS growth (22%) has out stripped EPS growth.

Their net equity went negative from 2019.

They have a new CEO https://www.bloomberg.com/news/articles ... management who's suspending stock BB in favour of investment in stores and staff. Which is good news for me, but the market seems worried about margins as a result.

They (SBUX) are currently fighting a union battle. I don't fully understand the pros and cons TBH.
https://www.cnbc.com/2022/04/21/starbuc ... -away.html

I'm currently trying to weigh up whether to start a new position here with SBUX or top up Maccies.

Matt

You piqued my interest, so I just took a quick look at SBX, even though I'm trying to avoid any further exposure to the Consumer Discretionary sector currently. What I don't understand is why the Gross Margin is so low? In an input cost inflation environment I'm not sure a consumer facing company with a GM of 30% is something I feel comfortable holding. I assume the price of coffee has increased along with other commodities recently? If that's the case, then even a 5% percent increase in COGS would really hit gross profit.

All the best, Si

[TheMotorcycleBoy]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

Historic metrics look good. Current free cash flow yield of 4.4 percent, average ten-year CROIC is 25.2 percent and ROCE is 34.6 percent. Don't ask me about the future!

Best wishes


Mark.

Yes. I'm still trying to figure them out.

EPS and FCFPS grew by about 12% on average 2016-2021. Sales only by 6.5%. More worrying DPS growth (22%) has out stripped EPS growth.

Their net equity went negative from 2019.

They have a new CEO https://www.bloomberg.com/news/articles ... management who's suspending stock BB in favour of investment in stores and staff. Which is good news for me, but the market seems worried about margins as a result.

They (SBUX) are currently fighting a union battle. I don't fully understand the pros and cons TBH.
https://www.cnbc.com/2022/04/21/starbuc ... -away.html

I'm currently trying to weigh up whether to start a new position here with SBUX or top up Maccies.

Matt

You piqued my interest, so I just took a quick look at SBX, even though I'm trying to avoid any further exposure to the Consumer Discretionary sector currently. What I don't understand is why the Gross Margin is so low? In an input cost inflation environment I'm not sure a consumer facing company with a GM of 30% is something I feel comfortable holding. I assume the price of coffee has increased along with other commodities recently? If that's the case, then even a 5% percent increase in COGS would really hit gross profit.

All the best, Si

Hmm.. I must admit that your remarks unnerve me slightly! I do not currently calculate GM in my spreadsheets. I should probably start to do this.

Many thanks, Matt

[simoan]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

Historic metrics look good. Current free cash flow yield of 4.4 percent, average ten-year CROIC is 25.2 percent and ROCE is 34.6 percent. Don't ask me about the future!

Best wishes


Mark.

Yes. I'm still trying to figure them out.

EPS and FCFPS grew by about 12% on average 2016-2021. Sales only by 6.5%. More worrying DPS growth (22%) has out stripped EPS growth.

Their net equity went negative from 2019.

They have a new CEO https://www.bloomberg.com/news/articles ... management who's suspending stock BB in favour of investment in stores and staff. Which is good news for me, but the market seems worried about margins as a result.

They (SBUX) are currently fighting a union battle. I don't fully understand the pros and cons TBH.
https://www.cnbc.com/2022/04/21/starbuc ... -away.html

I'm currently trying to weigh up whether to start a new position here with SBUX or top up Maccies.

Matt

You piqued my interest, so I just took a quick look at SBX, even though I'm trying to avoid any further exposure to the Consumer Discretionary sector currently. What I don't understand is why the Gross Margin is so low? In an input cost inflation environment I'm not sure a consumer facing company with a GM of 30% is something I feel comfortable holding. I assume the price of coffee has increased along with other commodities recently? If that's the case, then even a 5% percent increase in COGS would really hit gross profit.

All the best, Si

Hmm.. I must admit that your remarks unnerve me slightly! I do not currently calculate GM in my spreadsheets. I should probably start to do this.

Many thanks, Matt

I guess it depends whether you believe they can pass the increased costs onto the consumer without affecting sales? I assume they will try but people will notice a large percentage increase in their daily coffee when they are struggling to make ends meet. I don’t feel a need to take a punt on it.

Btw Loved the update from Qualcomm the other night. I topped up last week. Still looks stupidly cheap to me.

All the best, Si

[TheMotorcycleBoy]

Back to the subject of US shares what do folk think of Starbucks? I'm looking at them right now.

You piqued my interest, so I just took a quick look at SBX, even though I'm trying to avoid any further exposure to the Consumer Discretionary sector currently. What I don't understand is why the Gross Margin is so low? In an input cost inflation environment I'm not sure a consumer facing company with a GM of 30% is something I feel comfortable holding. I assume the price of coffee has increased along with other commodities recently? If that's the case, then even a 5% percent increase in COGS would really hit gross profit.

All the best, Si

Hmm.. I must admit that your remarks unnerve me slightly! I do not currently calculate GM in my spreadsheets. I should probably start to do this.

Many thanks, Matt

I guess it depends whether you believe they can pass the increased costs onto the consumer without affecting sales? I assume they will try but people will notice a large percentage increase in their daily coffee when they are struggling to make ends meet. I don’t feel a need to take a punt on it.

I know what you mean. Presumably loads of firms/customers are in a similar dilemma. I'm telling myself to take a long term view!

Btw Loved the update from Qualcomm the other night. I topped up last week. Still looks stupidly cheap to me.

Ha ha! No comment here, I'm afraid mate

Matt