Friday Feedback: The “I Don’t Want A Pickle” Edition
Welcome to Friday Feedback, Great Ones!
For the second week in a row, we’re going to wait a bit before diving into the Great Stuff mailbag. I just can’t, in good conscience, not talk about what happened to Peloton Interactive (Nasdaq: PTON) today. Man … what a freaking mess.
I was all prepped and ready to talk about Palantir Technologies (NYSE: PLTR) because Great One Lee S. said I haven’t talked about his favorite stock enough. But apparently, I was too ready … like nearly 2,000 words too ready.
As a result, Palantir is getting its own edition of Great Stuff … tomorrow. So, Lee, be sure to check your inbox bright and early tomorrow morning. That’s Saturday, November 6, for those still suffering from pandemic lag.
So, anyway, back to Peloton’s massive, not-so-stationary bike wreck. Its terrible treadmill tragedy. Its home workout washout. Its … you get the picture.
As it turns out, PTON investors don’t want a pickle … they just want to ride on their stationary bicycle. And they don’t wanna die, they just want a safe tread … mill.
Nooo! Not Arlo Guthrie again!
Quiet, you. What’s wrong with Arlo Guthrie? Besides, you try finding songs about bicycles. I can only reference “Bicycle Race” by Queen so many times, after all.
Sure, there’s “Broke Bicycles” by Tom Waits … but I’m not that depressed today. And you try finding a song worth listening to about treadmills…
But I digress … that’s not what I came to tell you about. Came to talk about Peloton.
I’ve seen some bad quarterly reports in my 15-plus years following the market, and Peloton’s third-quarter report ranks in the top 10. I mean, it was baaaad:
Earnings per share: -$1.25 reported versus -$1.10 expected.
Revenue: $805.2 million reported versus $808.7 million expected.
And those are just the headline figures. Peloton also said that average monthly workouts per subscription dropped to 16.6 from 20.7 a year ago. In other words, users are working out on their Pelotons less and less. And that means subscription cancellations could become a real concern.
But the real problem … the real anchovy in the pudding was Peloton’s guidance.
For fiscal 2022, Peloton cut its subscriber forecast to between 3.35 million and 3.45 million. The company also slashed its 2022 revenue guidance to between $4.4 billion and $4.8 billion, down from prior expectations for $5.4 billion.
When’s the last time you saw a $1 billion cut in revenue guidance?
I mean … wow. We’re all really impressed down here, I can tell you.
Wall Street was so “impressed” that it lopped off about $8 billion in valuation for PTON stock today as the shares plummeted more than 30%. That’s nearly as painful as falling on a Peloton treadmill.
I sincerely hope y’all heeded my warning after Peloton’s second-quarter report back on August 27:
Back then, Peloton announced a surprise 20% price cut to its signature stationary bike. Both myself and Wall Street analysts agreed that this was likely a sign of waning demand. And we were both right.
Peloton was never unique. There was never a moat or walled garden preventing competitors from snapping up market share. Literally anyone with a regular stationary bike and a smartphone, tablet, laptop or TV could reproduce what Peloton had created. And they could do it much cheaper.
What’s more, a lot of fitness people like touching grass and feeling the wind on their faces. Oh … and being seen if Instagram tells us anything. As a result, Peloton’s pandemic prevalence is now perishing in the harsh light of day.
The way I see it, Peloton has two paths ahead of it:
Continue its current trajectory and sink into obscurity like GoPro (Nasdaq: GPRO) — a premium product in a niche market with a plethora of cheaper competitors, or…
Get bought out by Alphabet or some other data-hungry company … just like Fitbit.
And that, Great Ones, is how the treadmill tumbles.
Wait, did you think we’d go a day without mentioning Tesla?!
A former Tesla employee released a brand-new innovation promising to make every EV out there instantly obsolete. Some call this man “Employee No. 7.” Even the “Godfather of the EV Revolution.” (But nobody calls him the space cowboy.)
He created the first working Tesla battery. Now he’s about to change everything again!
We have more than enough emails to send us ranting until next Friday — our inbox was virtually overflowing, I tell you. So, let’s cut to the chase and dive into some feedback fun!
Remember: GreatStuffToday@BanyanHill.com is where you can spill your guts or your genius — whichever path you choose is entirely up to you.
Now on to the main event…
Are You Plugged Into Plug Power?
I’m going to give PLUG a plug. I got plugged into PLUG when it was at $22 and [am] glad I did. PLUG has been a bit volatile lately but seems to be on the right track. The news that comes out from all directions is good, and with worldwide emphasis on clean energy, the future looks bright and shiny. I really like bright and shiny things, so if you haven’t plugged into PLUG yet, now might be a good time to do so. ?
— Richard K.
Heck, you may have even bought PLUG after we recommended it. Or, you might not have. You’re a real hoopy frood that way, man.
Just to toot my own horn for a bit, Great Stuff Picks readers who got in when I recommended PLUG are currently sitting on a gain of more than 160% — so kudos to you lot! Not that this takes away from your $22 buy-in price, Richard. Just saying…
You’re right that PLUG stock has faced volatility lately, but if you missed me talking about the — *checks notes* — six different announcements that Plug came out with just a few weeks ago that contributed to said volatility, you can catch up on all those movers and shakers right here.
I’ll warn you: It’s a doozy.
Not only is Wall Street beginning to understand Plug’s role in the clean-energy party, but the company itself is taking on key partnerships that will send its share price airborne … at least if plane-maker Airbus has anything to do about it.
It’s more obvious at this point that investors are becoming hydrogen happy and that Plug’s industry-wide acceptance is fully underway. So, yes, I agree with you that Plug’s future looks bright and shiny indeed, Richard.
Since you’ve already done the hard part of buying PLUG shares, do yourself a favor and kick back and relax a bit. Plug’s hydrogen domination shows no signs of slowing down — and you’re still in the early innings of what you and your fellow Great Ones could make on this stock.
As always, thanks for writing in!
Get Your (EV) Motor Running
RVing sounds like a lot of fun, but with RVs that get about 5 miles per gallon and gas prices approach $5/gallon, that means it’s a dollar a mile to head down the highway.
Might be worth looking into KOA or some other campground that profits from extended-stay RVs. Most people’s retirement income won’t support a lot of monthly mileage at this rate.
— Gordon F.
Hey Gordon, thanks for writing in!
I’ve talked at length about all the reasons that inflation is temporary, including the price of gas that you (maybe?) put into your mobile home motorcade … so I won’t rile the inflation nation any further today.
What I will say is that while we’re still very much an oil-based economy, there are these very cool, innovative new vehicles that run on electricity — and they’ve even started to penetrate the RV market!
While the electric revolution has been admittedly slow to reach the world of RVs and motorhomes — at least in comparison to everyday vehicles — RV electrification is gaining wider adoption and will likely become the future of Winnebagos everywhere as electric vehicle (EV) batteries become cheaper and more efficient.
Heck, camping connoisseur SylvanSport already has an all-electric, zero-emission motorhome in the works that will be able to drive 400 miles on a single charge. (Look out for that circa 2022.)
Of course, that’s just the start of a beautiful friendship between RVs and EV batteries — including their investment counterparts.
While you mention looking into extended-stay campgrounds as a potential investment opportunity, Gordon, I’m more focused on the companies that make this electrification possible in the first place.
You see, the surge in EV demand is also creating a surge in the materials critical to having these EVs come off the assembly line.
There’s only one company in the entire Western Hemisphere that supplies this critical material on such a large scale. And as EVs take over roadways all across America … they will rely on this material for future success.
And thanks again for your feedback, Gordon!
Feels Like A Touch, A Touch Too Much
I thought I was right on top of all the musical references today [no, that is not my primary purpose in reading your daily works!] — even going so far as to boldly postulate that you borrowed your “teaming, streaming” line from that of “burning, yearning” in Kenny Loggins’ Footloose.
But I simply could not narrow down your personal source of “keep on keeping on” … especially after finding nearly a hundred songs on Google with that title, dating all the way back to the 30’s I believe.
Of course I am familiar with the spoken phrase from the 60’s/70’s — and for some reason I associated it with the Grateful Dead [even though I don’t think I am conflating that with “keep on truckin”.]
In the end my guess is that the phrase didn’t come to you from any particular song, but instead was drawn more generally from the sex, drugs, and rock and roll culture from that era?
— Ken B.
Ken, sometimes I think you pore over our emails closer than we do — are you writing a thesis on our lyrical inclusions?
Or do you just want someone to tell you that life ain’t passing you by? I’m trying to tell you that it will if you don’t even try. You’d get by if you only cut loose…
All right, enough of that now. As much as I appreciate the lyrical and idiomatic investigating, your first hunch was right.
Not everything is a song lyric or movie reference. Gasp! I used to be one of those people who would only talk in quotes. I still am, but I used to be too…
Anyway, to “keep on keeping on” means you were already doing great stuff, to begin with … so keep on doing it. Capische?
Is the phrase “keep on keeping on” used in a specific song? Yeah … a bunch of them. There’s Curtis Mayfield’s “Keep On Keeping On” from his album Roots, for one.
Even the Allman Brothers had a song called “Keep On Keepin’ On” from the album that shall not be named. Just … please don’t go in with high expectations on this one.
I’ve actually thought about running a contest for musical references in Great Stuff. Find them all and … well, you win, I guess. Obviously, this would only work with the references we actually make — not the ones you think we make! (So, start brushing up on your doom metal and indie folk now.)
Because sometimes an idiom is just what we’re looking for — song lyrics aside.
Also, not for nothing, James S. … I feel you on the Bruuuce songs, a bit. But I’m not letting go of “Born To Run” and you can’t make me. If Bruce is out … how do you feel about Bon Jovi? Or is that a slippery subject that’s only half way there?
Thanks for writing in with your lyrical shenanigans, guys! The only question I have is: Who’s going to start up the Great Stuff Spotify playlist with all our song mentions? (Surprise … it’ll be 100% Arlo Guthrie.)
We Have Gathered You Here Today…
It is my assessment that you teamed up with probably the very best person and organization of its type in joining forces with Keith Kaplan.
I first began hearing accolades about him around the time that he went in with Stansberry roughly a couple of years ago, when they hammered on the value of his approach… So when you announced that you were working with him on a project, it only further solidified my belief that you are the real deal. Nice job! — Ken B.
I don’t know if your heart was in the right place, but your motivation was. Thank you. — Rich
I missed your deadline for that, and I may very well be interested (I am a huge fan … honest!) So, am I out of luck??, or might there be some help for us (I’m sure I’m not the only one).
Ciao, — David
And that’s all I’m saying on the matter.
For all you other Great Ones wanting to chime in for Friday Feedback, make your voices heard for next week! Ramble on with us and write in to the inbox right here, right meow.
GreatStuffToday@BanyanHill.com. We don’t bite … except for that one time. And I apologized.
In the meantime, here’s where you can find our other junk — erm, I mean where you can check out some more Greatness:
Until next time, stay Great!
Editor, Great Stuff