Category Archives: investment climate / big picture

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Flight into mergers: the solution for “defensive” consumer companies?

One of my favorite topics (and targets for criticism) for quite some time have been consumer companies. Especially those with a seemingly defensive business model that in the past offered stability in times of market stress. This recipe does not seem to work anymore, though. First and foremost, food companies have experienced an unprecedented bear market that caught many risk-averse investors on the wrong foot. When stocks have fallen significantly, takeover interest arises. Is this a sign that shares of consumer staples have fallen enough?

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Will NextNav multi-bag through terrestrial GPS?

Practically anyone knows and, at least occasionally, uses GPS — the Global Positioning System — to navigate from one point to another. GPS is an American solution that relies solely on a satellite-based connection, but it comes with certain physical limitations. It can also be spoofed or disrupted, potentially leading to massive damages in the economy, but also other areas like safety, emergency, and the military. NextNav is a small company where the core thesis is to bring terrestrial GPS as a backup solution to the U.S. — exclusively and on existing infrastructure. Is the stock a potential multi-bagger in plain sight?

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Positioned to not get wracked by a second inflationary wave

Due to the current circumstances, in this edition I am writing a more holistic and strategic weekly. It differs from what I am else publishing. Instead of discussing one concrete stock and aiming to be more or less precisely right with my directional call, my focus here lies on sharing my thoughts. Some of them might be in an early stage, necessitating more research, but also a wait-and-see observative approach. I am giving insights into sectors and ideas I have regarding where to have an eye on, but also where caution might be the better choice.

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Planet Fitness: Beneficiary of the weight-loss boom?

One of the booming (and at the same time a bit annoying) themes at the moment is weight-loss. Practically no day without such headlines. What in the past was a combination of a relatively clean diet paired with frequent activity to stay in shape, today seems to have shifted towards wonder drugs to do the job. Of course genetics also play a role, but broadly speaking this was the formula. In my view going to “the gym” is unlikely to be replaced by weight-loss drugs, no matter how much space they occupy in the news. To the contrary, Planet Fitness is an interesting case to have an eye on.

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Reading the tea leaves of Associated British Foods + new research report

Despite my negative view on food and beverage stocks, I have not given up. Associated British Foods, or ABF in brief, appears to offer one of the better setups on the menu. The maker of Twinings Tea is still family-controlled and it has a clean balance sheet. These two points alone dramatically differentiate it from other troubled competitors. However, ABF itself isn’t free of challenges either. Its “defensive” stock last week collapsed after a disappointing trading update. In this weekly, I take a look at ABF, as there’s a potential catalyst on the horizon. Good news for all my paid-members: I’ve finally found a food stock checking my boxes. My first member eggs-clusive research report for 2026 is out of the cage.

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Conagra Brands: A “defensive” consumer stock with an aggressive balance sheet

One or the other time, I have published a weekly about consumer stocks. My general view has been for years that these names should be avoided, being it food, beverage, or alcohol stocks, partly also household and cleaning producers (except one name I published a research report about, it’s up +22% over the last five months). Investors who bought blindly solely based on past performance have suffered big losses. While hopes for a turnaround to finally arrive continue to be high, there’s little reason to be overly optimistic. These stocks have lost their status as “defensive” core positions not for one, but for several reasons. The case study of Conagra Brands.

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Are you buying the past with popular ETFs?

This evergreen topic of active vs. passive investing, respectively stock picking vs. investing in index funds via ETFs, is a clash between two absolutely different philosophies. The only thing that’s certain here is that both parties will likely never agree. Both think they’re right and the opposition is wrong. As a passionate stock picker myself, I was triggered by a recent twitter post that in my view has spread a dangerous and misleading message.

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Nine lost years — Bottom in sight for Nestlé?

Since its peak at around 130 CHF per share and a market cap of almost 400 billion CHF, consumer staples heavyweight Nestlé has highly disappointed its fan base of predominantly defensively oriented investors. Who’d have thought that THE core investment in the consumer staples sector (besides Coca-Cola) could see its stock price get almost cut in half? Although I have not written a weekly about Nestlé so far, my readers know that Nestlé has not been interesting all the time. Is it now worth a look?

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My next Target for a Dividend Cut is a King

I stick to my view which many investors don’t share: this decade will be remembered as the one where dividends have been cut, not sparing big names. With this, I do not mean the obvious candidates like cyclical commodity producers or European car makers, but the ones where it really hurts (for dividend and income investors). In the past, I have written several weeklies, digging out names with proud series that have come to an end or with a high likelihood will end in the not-too-distant future. My next target is another dividend king.

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Has Big Pharma destroyed Shareholder Value (as expected)?

In March 2023, I published a controversial weekly, warning about investments in Big Pharma stocks. This group, often popular among retail investors for their dividends and pretend safety (size, diversification, proven, etc.), was already back then clearly facing a huge wall of painful patent expirations. As I had expected, many of the biggest — and most popular — names have seen their stocks painfully breaking apart while broader markets rose. Time for an update.

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