A humorous look at the companies that caught our eye, for better or worse, this week
Pizza Pizza Royalty (DOG)
PZA - TSX
All those Uber Eats and SkipTheDishes couriers lugging bags full of burgers, sushi and fried chicken? They keep Pizza Pizza Royalty Corp. investors up at night. With Pizza Pizza’s delivery business facing intense competition, its walk-in traffic hurt by the pandemic and many of its kiosks in stadiums and movie theatres closed, the chain posted a 13.3-per-cent drop in same-store sales for the first quarter. Gone are the days when a catchy jingle and a memorable phone number were all it took to dominate the pizza-delivery business. Now, investors are singing a new tune: “9-6-7, I’m sellin’, I’m sellin.”
Lemonade (DOG)
LMND - NYSE
Lemonade? Who would name their company after a stupid fruit? Apart from Apple, BlackBerry and Tangerine, I mean. Anyway, the online insurance provider left a sour taste in investors’ mouths this week when it reported a first-quarter loss of US$49-million. Even after a spike in claims tied to severe winter weather in Texas, Lemonade Inc. said its full-year EBITDA guidance “remains substantially in line with analyst consensus before the storm,” citing “extensive” reinsurance programs. But with the stock down more than 60 per cent from its January high, investors are still berry upset.
Canadian Tire (STAR)
CTC.A - TSX
Benefits of shopping on Canadian Tire’s website instead of at its stores: a) Nobody pushing a clipboard in your face to sign up for the Triangle Rewards program; b) No need to chase down a teenager in a red shirt to ask what aisle the furnace filters are in; c) No limit on the amount of stuff you can buy and have delivered to your door. Thanks to increased demand for patio furniture, bicycles and athletic clothing during the pandemic, the owner of Canadian Tire Corp., Mark’s and Sport Chek said online sales more than tripled in the first quarter as earnings crushed estimates. The Tire is burning rubber.
Virgin Galactic (DOG)
SPCE - NYSE
Maybe this whole idea of taking private citizens into space just wasn’t meant to be. Less than five months after Virgin Galactic Holdings Inc.’s first test flight was cut short when the rocket motor failed to fire, the company discovered a “potential wear and tear issue” with the carrier airplane that launches the spacecraft, which could cause further delays. The stock – which has lost about three quarters of its value since February – also took a hit on news that the ARK Space Exploration and Innovation ETF sold nearly all of its remaining shares in the company. Good thing founder Richard Branson dumped US$150-million of stock back in April.
Canada Goose (DOG)
GOOS - TSX
Canada Goose customers don’t mind spending more than $1,000 on a parka. But Canada Goose Holdings Inc. investors are suddenly very price-conscious about the stock. Even as revenue for the fourth quarter ended March 28 blew past expectations, boosted by expansion in China and global e-commerce growth of 123 per cent, the shares sank after the company’s margin forecast came in below analysts’ estimates. With Canada Goose chief executive Dani Reiss saying the company is “not planning on tourism returning” in fiscal 2022, investors are worried that there won’t be enough wealthy travellers opening their wallets for overpriced coats.
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John Heinzl