“The New American Super Brand”

By Travis Johnson, Stock Gumshoe, March 13, 2007

The Gardners are at it again, peddling their Motley Fool Stock Advisor Newsletter with the promise of the bonus free report on the “New American Super Brand.”

Now I actually like the Motley Fool, and have paid to subscribe to some of their products in the past. But they’ve definitely perfected the insanely long advertising email, chock full of company teasers.

This latest email that was forwarded by a reader? 17 PAGES. My God, does this really work?

I guess maybe it does, because they keep doing it. So what’s this “New American Super Brand” they’re issuing a report on?

They compare it to Starbucks, Wal Mart, and Nike. Good so far.

And they provide a bunch of hints:

  • “A couple of years ago, you couldn’ve gotten into this company for about a third of what it costs today” (that’s stretching it with current prices, but the email is probably a bit out of date)
  • This brand made the “revolutionary” decision not to follow the industry practice of renting shelf space. (That tells you we almost definitely have a discount/department store or supermarket here)
  • Sales jumped 23% in 2004, and 22% in 2005
  • 3X more profitable than their major competitors
  • $267 million in cash, only $15 million in debt (competitors are much more indebted).
  • “international sites so far [only] in Canada and Great Britain”
  • goal of $12 billion in sales in 2010
  • won Fast Company’s “Customers First” award.

OK, that’s more than enough hints — ready?

The New American Super Brand is Whole Foods Market Inc. (WFM)

I’m sure the Stock Advisor service is great for some people, and that reading their analysis of the company might give you a better perspective, or more conviction if you’re wanting to buy. But if you just want to know what this company is, there you have it — thanks to your friendly Stock Gumshoe. There’s no shortage of free information available about this massive company, so don’t feel like you have to subscribe to a service to understand them.

I’ve been interested in this company for quite some time, too, though I’ve never thought it was cheap enough to buy. Now, shares are near their 52 week low and about 40% off the highs of late last fall, thanks to some disappointments and a big acquisition and, perhaps, fears of growth stocks in general — so perhaps this is your chance. It’s still not cheap, in my opinion, but if it’s the New American Super Brand it may never be cheap. Caveat emptor.

Want to keep up with the Gumshoe? Click here to subscribe now — free email alerts.

Are you getting our free Daily Update
"reveal" emails? If not,
just click here...



guest

12345

This site uses Akismet to reduce spam. Learn how your comment data is processed.

28 Comments
Inline Feedbacks
View all comments
Bill
Bill
Guest
March 16, 2008 7:08 pm

Thank for the info…If it is the one new superbrand then why do I need any advice from them after that.

Gravity Switch
March 18, 2008 12:08 pm

Thanks Charlie — don’t know what their history is with LUK, but I certainly also have some fondness for the company. If there’s one thing Leucadia is not, however, it’s a “brand” of any kind. LUK is downright secretive, and owns lots of companies that consumers have never heard of.

Add a Topic
287
👍 7
TD
TD
Guest
April 21, 2008 1:10 am

Thanks for the info! Much appreciated.

Ann J
Ann J
Guest
April 30, 2008 8:57 am

While Motley Fool has some good info, their e mails, such as the new Superbrand hype has been floating around for a few years. Seems like their motives have switched from educating “Fools” to “creating” Fools. I stopped reading their stuff quite a while ago.

Add a Topic
329
NewbieComer
NewbieComer
Guest
May 11, 2008 9:46 pm

Thx..just saved me $99 ! Was just about to order..keep ip the good work, Motley Fool is good though, sure got my attn. !!

Add a Topic
329
Mowgli
Mowgli
Guest
May 13, 2008 1:54 pm

I am an inspiring investor and want to learn more of what is out there, in making my first stock selection. I have been fumbling through various servers and have come across MF. Sure they have the numbers but they swear every stock they pick has similar characteristics as Wal-Mart, Starbucks, Nike, and AOL; after reading their emails after awhile it seems sort fishy but that’s just me.

Add a Topic
5971
Add a Topic
5971
Add a Topic
976
bob Farkas
bob Farkas
Guest
June 14, 2008 9:45 am

Dear Sir

thanks for the Motley info. There are many of these guru’s (that is another one) around that are selling information which a lot of it is crap. I tried one, called gamechanger, Yareds game changers. A lot of stories about walmart, apple, microsoft, Rim but no solid analysis on the future picture. They completely missed hedging the weak US dollar against other currencies, only recommended American stocks, They listed a stock CHIPOTLE as a must buy, really cheap they said, market advantage was excellent mexican food at a resonable price, lots of chain stores.. the next Macdonalds.. it will be great..buy at under $95. the next day or 2 days later it was on their loser list.. must sell.. it was tumbling quick, from 98 to 94 to 92.. 90 and then the tomatoe samonella poisoning happen in california happened, probably around $75 today. They missed the commodity risk, and the weak consumer support, very very poor analysis. the recommendation was based upon performance when Macdonalds did own them. The current management is not Macdonalds as they sold them, realizing, health foods was the next trend in restaurants, not mexican food, another miss by GameChangers.
Like many of these services their analysis is skimpy, sensationalistic and nothing that can’t be found anywhere on the internet or in a good financial paper.
Solid investing is built on high return dividends with companies with solid balance sheets, good market share and excellent management. Dont believe me however, google “the highest dividend companies” and you will find the wall street studies done over a 30 year period. Those are the facts Jack!
I dont need 30 percent appreciation on a stock that is volatile. I much prefer a 8 to 10% dividend, slower long term growth of 5% as a minimum giving me an annual return of 13 to 15% on dividend reinvestment. The stock is not suspectible to every political bit of bad news, holds steady thru the bad times..does subprime mortgage ring a bell?? and does very nicely in the good times. A $300,000 portfolio setup this way generates $30,000 in income or about $2400 per month and another $15,000 in growth minimum in one year. Not bad in my books.. Leave it alone for 5 years.. and see what its worth then after taking the dividends and reinvesting them in more stock. So take all these astounding growth rate stocks, the wild capital gains.. and quite frankly .. stuff them. They are in the short term a great way to lose as people panic when prices drop or they play the short term game and sell quick on a profit, but when the stock doesnt go up or when it tanks a bit, they are forced to hold it, reasoning it will come back, while in reality it keeps going down as it has no solid financial reason to appreciate.. and oh..it doesnt pay a dividend. so you lose and lose.
Create a newsletter that caters to this formula and you will get my subscription

here is my examples of not sleeping good at night
Google – P/e ratio – ridiculously high, no dividend, from $700 to $450 in 6 months, US earnings tanked, Asia saved their bacon last quarter that few predicted. Do you want to be exposed to the politics of china? india? $70,000 for a hundred shares and you can lose half of that in 6 months. Their growth rate is an exponential curve and not sustainable. First time they report a bad quarter.. watch out!

take $70,000, lets take a stock Permain Basin Royal Trust (NYSE: PBT) 1 year performance, $14 to $27 last month to about high $23. so about 75 to 80% growth. Every month you received a $.20 dividend per share.
so take $70K (5,000 shares) x 1.75 growth rate, about $122,500 in market value. Dividend was $.10 per month per share @ $14 or 8.5%, at $23.75 it is $.20/month or 10.5% which buys another 50 shares per year. Guess what.. it wont drop.. the markets wont let a stock paying a dividend of %10 do that. pretty boring stuff… but, i sleep good at night.

Apple – announces their new product, stock tanks $15 per share, no dividend, P/e ratio 35:1, good company, STeve Job is good but, reward your shareholders!!! what is there to stop this stock from going to $100 per share? If they lose one percent market share to Nokia or Rim.. just watch! nothing. A decent dividend would reward the shareholder and make the price sustainable or be a hedge if they are losing market share and prevent a drop of 40% in one week.

Add a Topic
846
Add a Topic
6067
Add a Topic
5971

We use cookies on this site to enhance your user experience. By clicking any link on this page you are giving your consent for us to set cookies.

More Info