Looking for something to give thanks for

By Frank Buhagiar on Monday 27 November 2023

Looking for something to give thanks for
Image source: Looking for something to give thanks for
CommentaryFoodTech Investment

Food on the Move: FFF’s weekly roundup of listed FoodTech’s movers & shakers

Last week in MILK AND COOKIES AND STAR TREK BADDIES, Food on the Move asked the question “how come listed foodtech doesn’t always follow the Nasdaq’s lead?”, before going on to provide a possible answer: “Perhaps…US Treasury yields need to fall and not just remain steady. When US Treasury yields do fall then…The pull of general market sentiment just too much for the listed foodtechies to resist and so share price risers gain the upper hand.” One week on and markets have, obligingly, provided an opportunity to put the theory to the test: Nasdaq finished the week up 1%; 10-year US Treasury yields held steady. FFF’s listed foodtech? According to the theory, should be a ‘down’ week - more share price fallers than risers. No contest in the end. Twice as many fallers compared to risers: 14 share price risers, 28 fallers, three non-movers. Another ‘down’ week then just as the theory predicted. Ok, shortened week thanks to…er…Thanksgiving in the US. Still, a theory worth keeping an eye on.

Speaking of eyes, those with the beady variety may have noticed a discrepancy in the above FFF stats. 14, 28, 3 add up to 45 constituents. One shy of last week’s 46. Calls for a quick roll call. No need to go too far down the alphabet. The missing foodie belongs to the Bs - Blue Apron. No need to dig too deep to find out where Blue Apron has gone. Into the arms of Wonder Group, that’s where. And no need to look beyond the title of Wonder Group’s 13 November 2023 press release for an explanation:  Wonder Announces Closing of Blue Apron Acquisition to Enhance its Leading Platform for Mealtime. So, it’s adios Blue Apron. Question is, where next for the meal-kit sector?

The Financial Times has something to say on this. In “Blue Apron: meal kit maker is chopped up, sold and reheated”, the FT’s Lex Column doesn’t mince its words: “…meal kits are a 2010s trend that has grown stale. Blue Apron, once a near $2bn US company, has been bought by mobile restaurant start-up Wonder Group for $103mn. That should unnerve investors in European rival Hello Fresh.” That’s because “…after more than a decade in business, Blue Apron has failed to produce profit or sales growth. It has funnelled revenue into marketing and discounts to attract new customers. Rivals like Home Chef and Berlin-based Hello Fresh fought for the same market share. Blue Apron’s marketing spend was equal to 18 per cent of revenue last year. At Hello Fresh it was equal to 17 per cent…Hello Fresh may be profitable but it too is reporting slowing growth. It has kept margins intact by cutting spending.” Article does not seem to have gone down well with Hello Fresh’s share price – shares off 7.5%. Shareholders will be hoping it won’t be Good-bye Fresh anytime soon.

From one Fresh to another.  Hello Fresh’s fall, nothing compared to the two-thirds share price drop seen at Miss Fresh. As YahooFinance reported, the Chinese grocery delivery co. company “…announced that the equity financings and the business acquisition under the share purchase agreements, as previously announced on August 3, 2023, and the transactions under the share transfer agreement, as previously announced on August 7, 2023, have been terminated.” That’s not all, Yahoo goes on to explain that “On November 15, 2023, the Nasdaq Hearings Panel…notified the Company that the Panel has determined to delist the Company’s securities from The Nasdaq…effective at the open of trading on Friday, November 17, 2023…The Company expects its American Depositary Shares to be eligible trade on the OTC Markets effective with the open of trading on Friday, November 17, 2023.” FFF’s listed foodtech numbers not quite down to 44 then courtesy of the OTC Markets. There you go, something to give thanks for…