Wings & Pizza
By Mon, Jul 20, 2020
Hey Scoopers,
The same worries and hopes that we have been discussing for quite a while kept the market in its place and barely moving on Friday. — More on that in the “Overall Market” section.
Beyond the overall market, based on the stock market prices, it seems that wings and pizza go well with the shelter-in-place situation. — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, say goodbye to the Queen of Skies. — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
Market Recap
- U.S. markets: Stock market indices didn’t agree on the direction but also didn’t move much. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price was almost where it was last week, and continued to trade sideways.
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What Happened In The Market On Friday?
Friday was a calm day in the market, and none of the three primary stock market indices moved much. The Utilities and Healthcare sectors had a big jump, but their upward movement got offset by the decline in the Energy and Financial services sectors. The Covid-19 cases are up, the vaccine is in the works, it’s the last week of the $600 unemployment benefits, the market is up, and the economy fluctuates between the re-opening and re-closure. It’s not a surprise that the market fluctuated in its place.
Order Wings On The Side
So, what happened?
Shares of Wingstop (Ticker: WING) were up more than 3% on Friday. The company is expected to announce its quarterly earnings report at the end of July. However, investors are already celebrating. Unlike the restaurant industry, Wingstop hasn’t been too much hurt by the Covid-19 pandemic. As a restaurant chain that was already set for a large volume of to-go orders, there wasn’t much adjustment needed to adopt the new norms. For example, in April 2020, same-store sales grew by 33.4%, which speaks to the resilience of the restaurant chain to the shift to dine-in food consumption. Furthermore, on June 30th, the company announced the launch of its ghost kitchen concept. These are Wingstop locations designed only to support to-go orders without any sitting options. Investors are buying the stock and perhaps ordering some wings on the side too.
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Pizza & Shelter-In-Place Go Well Together
So, what happened?
Shares of Domino’s (Ticker: DPZ) were down more than 4% on Friday. Last week, the company announced its quarterly earnings report, and the numbers were telling a tale of a well-managed, resilient company. According to the company’s press release, “U.S. same-store sales grew 16.1% during the quarter versus the year-ago period and were positively impacted by customer ordering behavior during the COVID-19 pandemic.”
Additionally, Domino’s is one of the few restaurant chains that resisted the urge to outsource its delivery operations to the likes of GrubHub (Ticker: GRUB) and UberEats, and took quite a lot of punches from the investor community for that decision. However, the company’s investment in its mobile order technology and delivery is paying off, and investors couldn’t be happier. The decline on Fridays seems to be investors selling their shares after the company hitting a new stock price record in 2020.
Goodbye To The Queen Of Skies…
So what happened?
The impact of the COVID-19 pandemic on the global travel industry is nothing new to investors. But, the impact of the pandemic is going farther along that some of us had anticipated. The double-decker 747 aircraft, also known as the queen of the skies, is forced to retire sooner. If you’ve ever had the pleasure of flying in one of those aircraft, we are sure you’d be joining us to admit that the size and the beauty of those jumbo monstrosities never stopped to impress. However, with size comes a thirst for fuel, and airlines all around the world had stopped ordering the new aircraft.
Even Boeing (Ticer: BA) had decided to stop the product in just a few years. However, it seems the pandemic has accelerated the timeline. British Airlines is the new company announcing the retirement of its 30+ 747 aircraft in response to the COVID-19 impact on the travel industry.
Goodbye to the queen of skies! You were a pleasure to ride in one of those transcontinental long-haul flights!
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About the Author
The authors of this Scoop are the editorial team at Stock Card, led by Hoda Mehr. Hoda Mehr is CEO and Co-founder of Stock Card and the host of Renegade Investors podcast. She runs a community of 40,000 stock market investors and manages Stock Card's successful flagship portfolio, Roll with Our CEO, on Stock Card Portfolio Store. Hoda is an Economist with an MBA from Concordia, John Molson School of Business. She applies behavioral economics, data journalism, and storytelling to all aspects of her work. Before starting Stock Card, Hoda worked as a strategy and insights lead at technology companies including Symantec, Aimia and Sony. Create a free account to do your stock market research easily and mistake-free: Stock Card Stock Card
