Consumer Products and Services

Comatose watchdogs evoke Great Recession flashback

14 Jul 2022

Crypto lender Celsius slipped through regulatory cracks at the state and federal level. Failures in isolation aren’t big enough to be systemic. But SPACs, too, are crumbling, and people are getting hurt. As sirens wail, like 15 years ago, financial police sleep through it.

FOMO will be private equity’s saving grace

13 Jul 2022

The appetite to commit to new buyout funds is waning as declining public market valuations make pensioners and others overweight in private holdings. Spiraling requests from the likes of KKR may make investors want to retrench. But post-crisis bargains are too good to pass up.

Capital Calls: Delta’s earnings are bad and worse

13 Jul 2022

Concise views on global finance: Shares in the company fell 7% after the company missed earnings expectations. That’s bad, but worse is that its main strength – pricing power – has limits.

China’s “new retail” hype meets old retail reality

13 Jul 2022

Alibaba’s high-tech Freshippo grocery chain lowered its targeted valuation by 40% as investors shy away from trendy online-to-offline retail plays. Shares in traditional supermarket chains are outperforming as e-commerce brands tank. It’s a lesson in the limits of disruption.

Wall Street hates to love watchdog Rohit Chopra

12 Jul 2022

The head of the U.S. consumer finance agency has an expansive view of his role, to the chagrin of lenders he regulates. But banks are going overboard in attacks on the CFPB’s bid to reduce discrimination and vet mergers. Chopra may be their best bet for reining in fintech rivals.

Health adds new letter to ESG for food groups

12 Jul 2022

Government crackdowns on junk food marketing will hurt sales for companies like Frosties maker Kellogg. And investors are increasingly pushing consumer groups to use independent criteria to show how healthy their grub is. Tougher scrutiny will mean a valuation slap for laggards.

Capital Calls: PC meltdown, Software short-seller

12 Jul 2022

Concise views on global finance: Shipments of personal computers suffered the biggest decline in years, yet still exceed pre-pandemic levels; SoftBank-backed communication software group Sinch has lost over a third of its value after a short-seller attacked its accounting.

Capital Calls: Klarna’s slashed valuation

11 Jul 2022

Concise views on global finance: The Swedish fintech group’s valuation is down 85% in just over a year to $6.7 bln.

Facebook loses its FAANG chompers

8 Jul 2022

Meta’s Mark Zuckerberg is prepping for a downturn not seen since its early days as a public company. That’s as Google, Amazon, Apple and Netflix are chasing advertising, its main business. If Facebook’s share of the ad pie slips by a hair, Meta’s stock could be worth 25% less.

Kraft Heinz grocer war, China’s creaking economy

7 Jul 2022

Tesco has pulled products made by the $47 bln baked bean producer over price rises. In this Viewsroom podcast, Breakingviews columnists debate how this loss of variety could open the door for rivals to expand. Also, the People’s Republic’s means of hitting economic goals.

Reliance dresses Gap in more optimistic India garb

7 Jul 2022

A franchise deal with the underperforming U.S apparel outfit is boss Mukesh Ambani’s latest bid to expand his shopping empire. It’s a low-margin business: Gap lost money for an earlier partner. India’s retail king has the scale and supply chains to stitch together better returns.

Amazon and Grubhub cook up low cash diet plan

6 Jul 2022

The food delivery firm has agreed to pay Amazon in warrants in return for the e-commerce giant serving up new customers. Paying a supplier in stock – as tech firms do their staff – makes sense when cash is tight. Amazon is the perfect chef to stir that pot.

This time, U.S. housing bubble burst is tolerable

6 Jul 2022

Mortgage rates averaged about 6% before over-leveraged homeowners helped spur the 2008 financial crisis. Now as borrowing costs approach that level, a frothy market is set to decline. But Americans’ budgets are healthier, and a housing correction could actually be good for some.

Disney boss’s next challenge: win over investors

6 Jul 2022

The $177 bln company’s board gave Bob Chapek three more years at the helm despite a rocky start. But with video streaming in danger of slowing and the shares down 40% year-to-date, the CEO needs some financial magic. Offloading the ESPN sports network would restore value.

Capital Calls: Amazon/Just Eat Takeaway

6 Jul 2022

Concise views on global finance: The $1.2 trillion e-commerce giant is reprising its deal offering Prime subscribers membership of UK food delivery outfit Deliveroo with the U.S. arm of its $3 billion Dutch rival.

Private LBO lenders find zen amid the storm

5 Jul 2022

Firms like Blackstone are providing debt for buyouts even as banks pull back. Fallen tech star Zendesk is one beneficiary. The logic for lenders may be takeover targets’ steady revenue and scope for cost cuts. The pressure to deploy $390 bln in unspent capital can’t hurt either.

Inflation finally kills shaky U.S. trade-war logic

5 Jul 2022

President Biden is close to axing some of the levies on $350 bln in Chinese imports, partly driven by a belief they hurt consumers. A better reason would be that they never succeeded in changing China’s ways in the first place. That ought to inform fresh tariff discussions too.

Kraft has secret sauce in UK grocer food fight

4 Jul 2022

Supermarkets like Tesco are dropping the U.S. food giant’s wares after “unjustifiable” price hikes. That earns brownie points from shoppers and shunts politicians’ gaze to Kraft’s beefier margins. But less choice on the shelves may push business to cut-price rivals like Aldi.

Kohl’s risks being left on a lonely retail shelf

30 Jun 2022

U.S. retail sales are falling, big store chains have overstocked, and inflation is spooking consumers. That raises pressure on the underperforming Kohl's, which is weighing a potential offer from Franchise Group. If a deal materializes, it will be hard to refuse.

Unilever ice cream mess is only partly cleaned up

30 Jun 2022

The $116 bln group has sold its Israeli Ben & Jerry’s business after the ice cream maker halted sales in the occupied Palestinian territories. Unilever gets to extricate itself from a no-win situation. Yet the hipster dessert’s ongoing autonomy means the two may clash elsewhere.