Gophers, Bruce Moody, Shopco discussed on Chad Hartman
From university of Minnesota joins us right now on C show morning. Dr Paul good morning to you. What about the general mills story? We just heard about. Well, it's good news for the company because the two things that analysts look for and that investors look forward there that is increasing earnings meaning profits are up net profits, but also increasing revenue which means the company's making more money while also grabbing market share, and that means growth prospects. That's the kind of thing that analysts look foreign companies, and that's really a departure from a longer term train, which has been increasing earnings at general mills, but by shrinking shrink way, ultimately to profits over the long run you go out of business. So this is good news for general mills shows that they're finding new niches to expand in both by acquisitions through acquisitions the pet food area. But also intrinsically through their their big brands like Cheerios and the lake Paul is the agenda. Bruce moody chair in law and business, by the way at the Carlson school of business and the law school is well, okay. Let me tie in March madness and business if I can't because there's several angles here. Oh my gosh. There's so many we're going to talk about this more in detail in April the eighth, and we have our all star panel together for a business by Carlson. Quarterly report on the business of college turn. Ernie's. And what they mean for both the colleges and the host cities because we've got the final four coming here. I was telling Steve Simpson. This should be a national holiday the Monday big that everybody makes your picks because then you wouldn't waste all the company's money at work. Dave I'm shocked gambling because you don't wanna do this at home. Now, you're to do the work. But there's so many interesting angles here a couple so quiz free day. Final four NFL postseason major league postseason, which of these three generates the most in the way of ad revenue. File well, I would think Super Bowl, but no you'd be right overall the ad revenues highest for that's about one point six billion dollars. But if I change the quiz to which makes the most money for the person who buys it, then it'd be the final four interesting they generate about one point three billion. You know, they've got two three weeks of this man this, and they can sell all the advocate, but the people who buy it by for a lot less that has the NFL to the different broadcasters. Spend around five billion dollars at one point seven billion in advertising. But when they buy the one point three billion advertising for the final four, they only spend about they spend less than a billion. So there's more money to be made at least so far in the final four four. That's one aspect to it. Here's another one. I bet you've heard about wins and losses in the beginning. But I bet you haven't heard about units. So the gophers and every team that's in the NCAA tournament gets a unit that's worth about two hundred eighty thousand dollars paid. About six times over six years. So about one point six one point seven eight million dollars paid to their conference each time. They win a game play a game. So the gophers are gonna earn the big ten two hundred eighty thousand times six years about one point six one point seven million for the big ten. They win another one. They beat Louisville on Thursday. Then it's two units. In fact, if you win the the whole national championship at six units. So there's lots of money being paid in different kinds of pockets of different individuals. So when you say the gophers, let's win let's say let's get him a unit and go on for more units because that's good for the big ten which ultimately pays it out back to Minnesota. Okay. So big ten does collect that check. Right. And supposedly it's supposed to share it with all the teams, but nobody really enforces it. So ultimately some of it goes back to the university. Very interesting Paula again, I remind folks at April eighth we'll be talking about this, which is a championship days. Not it is it'll be on the eve of the final game of the final four. So I think there'll be a lot of buzz going around here in the twin cities. Hey, let me just change the subject briefly here. But let's talk about from nineteen sixty to sixty two in the four made. US retailers. That's right in that those two or three years real golden age for retailing target, WalMart, KMart and Shopco were all founded in one of them shock looks like it's going out of business now in the next three or four months, and that matters because there are three hundred stores are in the mid west and their fifteen thousand employees some of them her neighbors right here in Minnesota. So the demise of Shopco, you might think it's like the demise of big brick and mortar retailers. I don't think. So David, I think that this demise. A Shopco is more about managerial miscues it's making acquisitions and loading themselves down with that. And then then not investing in these bricks and mortar locations so that their destinations for it. And I think there is a cautionary tale for target WalMart there, and of course, you know, KMart now Sears is holding on by a thread. So they may be the next one to go. So that sixty to sixty two periods maybe see one and maybe two major retailers go under soon enough, what about Levi Strauss what's going on different stories? A great story with them. They're about to do an IPO. They're gonna float about ten to twenty percent of the company to the public. And see that the floats going to value the company about six billion dollars. They're big comeback story. Their heyday was early nineties, and then they've seen sales shrink. But now to this new CEO charlesbourg of the last seven or eight years, he's really revitalized the company with big advertising, and it can of new emphasis on different channels for the way that they sell. It's a story about how you can invest. Smartly managerial good cues and grow the company rather than see it shrinking demise. Before you go anything new. We talked about last week shortly the aviation industry. It's a big thing the week that the European crash occurred. I think somewhere around ten billion dollars market cap at Boeing was just wiped out gone. The interesting thing is the ripple effects with other airlines. The airlines day that have a lot of max max nights that southwest American and United from cancellations replacement aircraft. We've really seen those three companies lose I think perspectively southwest thirty million dollars American about twenty and United about eleven million dollars. You see the ripple effects across the corporate boardrooms from that crash one airline to watch. It's not in the US with called Norwegian air shuttle. They're exclusively dependent on max, max nines, and they really don't have easy replacement aircraft were overseas if you're investing overseas that's a risky stock right now while while while Paul too many things not enough time. But I'll look forward to seeing you next week. Then of course, April eighth on folks to make sure they tune in. Or are we going to do down to the galley are we I think we'll be Dan. Gal over I'll be great happy people over there. Big rate. Rollicking discussion debate Paul Voller. Jonah Bruce moody chair in law and business university of Minnesota here on eight real WC. Dave Lee this morning house. Look forward to Paul's visits here.