Supervalu (NYSE: SVU) Archives

daniel October 29, 2018 Amazon is an Opportunity for United Natural Foods, Are Supermarkets Profitable?, Can Grocers Make Money?, Is United Natural Foods (UNFI) a Value investment for the Age of Amazon?, Supervalu (NYSE: SVU), UNFI, United Natural Foods, United Natural Foods (NASDAQ: UNFI), United Natural Foods buys Supervalu, Will Supervalu make United Natural Foods a Value Investment?

Is United Natural Foods Making Money?

A UNFI sale of Supervalu’s supermarkets raises doubts about the viability of brick and mortar grocers as an investment.

Grocers are not making much money in today’s market. For instance, Supervalu reported $36 million in cash and short-term investments on September 9 2018. In addition, Supervalu reported a free cash flow of $8 million and an operating cash flow of $48 million for 3rd Quarter 2018.

Supervalu reported a net loss of -$57 million and an operating loss of $53 million on $3.512 billion in revenues for 3rd Quarter 2018. Therefore, it is easy to see why UNFI wants out of the supermarket business.

Grocery Wars

daniel June 19, 2018June 19, 2018 Amazon (NASDAQ: AMZN), Can Sprouts Survive?, How Delivery Threatens Sprouts, Instacart, Is Sprouts Doomed?, Kroger (NYSE: KR), Kroger and Ocado, Kroger and Ocado Threaten Sprouts, Ocado Group PLC (LON: OCDO), Sprouts, Sprouts Farmers Market (NASDAQ: SFM), Sprouts' Limited Resources, Supervalu (NYSE: SVU), The Danger from Amazon to Sprouts, Who would Acquire Sprouts?

Is Sprouts Doomed?

Delivery can destroy Sprouts because it keeps customers away from Sprouts where they can see its low prices.

Traditional supermarkets depend heavily from all the spur-of-the moment purchases from shoppers in the store. How many times have you walked into a supermarket to “grab a couple of things” and ended up pushing a full shopping cart out the door?

Online shoppers only get what is on their shopping list, because they are not in the supermarket to get tempted by that extra stuff. That is good for customers’ pocketbooks but bad for Sprouts’ bottom line.

The traditional supermarket is a marketing machine cleverly disguised as a food store. Grocers fill their stores with temptations such as endcaps, free samples, delis, and cafes. The online shopper sees none of that stuff.

Grocery Wars

daniel May 29, 2018 Amazon (NASDAQ: AMZN), Cub Foods, Instacart, Is Supervalu a Value Investment?, Is Supervalu Making Money?, Is Supervalu Teaming up with Amazon?, Lidl ups its Game, Ocado Group PLC (LON: OCDO), Shop ‘N Save, Supervalu (NYSE: SVU), Supervalu is getting out of Brick and Mortar Supermarkets, Supervalu’s Financials explain Bezos’ grocery push, Target (NYSE: TGT), Who is buying Supervalu?, Will Amazon become America’s Grocer?

Who is buying Supervalu?

Even if Supervalu keeps operating the distribution centers its new customer might be Amazon or Instacart.
A strong possibility is that Supervalu will get out of brick and mortar supermarkets and concentrate on selling groceries to delivery services. Its’ network of distribution centers is well-positioned for that eventuality.
Supervalu’s financials explain why Jeff Bezos is so interested in the grocery business. Grocers like Supervalu have a very strong cash flow, and Bezos loves cash.

Grocery Wars

daniel December 1, 2017 Amazon (NASDAQ: AMZN), Can Sprouts Compete with Amazon or Kroger, How close is Sprouts to the Death Spiral?, Is Sprouts a Good Investment?, Is Sprouts Making Money?, Kroger (NYSE: KR), Sprouts, Sprouts Farmers Market (NASDAQ: SFM), Supervalu (NYSE: SVU), The Death Spiral, Walmart (NYSE: WMT) and Kroger, Who would Acquire Sprouts?

Can Sprouts Farmers Market Survive without Acquisition?

The most obvious buyer for Sprouts would be Kroger, which has been aggressively trying to attract more organic and high-end grocery business.

Grocery Wars

daniel October 4, 2017 Dillard’s (NYSE: DDS), Dollar Tree (NASDAQ: DLTR), Doomed Retailers, Fred’s (NYSE: FRED), JC Penney Co. (NYSE: JCP), Kroger (NYSE: KR), Mass Die-Off of Retailers, Mass Die-Off of Retailers coming for Holiday Season 2017, Rite Aid (NYSE: RAD), Sears Holdings (NASDAQ: SHLD), Some Doomed Retailers, Supervalu (NYSE: SVU), The Bon-Ton Stores (NASDAQ: BONT), The Ever Growing List of Doomed Retailers, The Great Retail Apocalypse of 2017, Toys R Us, Walgreens (NASDAQ: WBA)

The Ever Growing List of Doomed Retailers

Expect to see a mass die-off of sick retailers in January and February of 2018 as the dust from the 2017 holiday season settles. If it is anything like last year’s numerous retailers are likely to report losses and more than a few will shut down.

Grocery Wars Opportunities

daniel June 20, 2017 Amazon’s (NASDAQ: AMZN), Amazon’s (NASDAQ: AMZN) $13.70 billion purchase of Whole Foods Market, Barnes & Noble (NYSE: BKS), Best Buy (NYSE: BBY), BJ’s Wholesale Club, Brick and mortar is very cheap right now, Deliv, Going brick and mortar will let Amazon accept cash payments, Instacart, Kroger (NYSE: KR), Office Depot (NASDAQ: ODP) and Staples (NYSE: SPLS), Rite Aid (NYSE: RAD), Sprouts Farmers Market (NASDAQ: SFM), Supervalu (NYSE: SVU), The Everything Store, There are several good reasons for Bezos to go shopping for brick and mortar acquisitions, Uber Technologies Inc., Wegmans, What Brands will Amazon Acquire Next?, What Will Amazon Acquire Next?, Whole Foods Market (NASDAQ: WFM)

What Will Amazon Acquire Next?

The question we need to ask is: “what companies will Amazon acquire next?” Some probable candidates for Amazon acquisition include:

Grocery Wars

daniel June 14, 2017 Aldi is a problem, Costco Wholesale (NASDAQ: COST), Fresh Encounter Inc., Is Marsh’s Fate Supervalu’s Future?, Kroger (NYSE: KR), Marsh, Retail Apocalypse, Supervalu (NYSE: SVU), Target (NYSE: TGT), The Amazon Menace, The Supermarket Business Model Might be Unsustainable, Things are About to Get Worse for Supervalu because of Aldi, Walmart (NYSE: WMT), Why are Supermarkets in Trouble?

Supermarkets fight for Survival at SuperValu

Traditional supermarkets like Supervalu are struggling because of greatly increased competition and a collapse in food and consumer goods prices. These forces might make the historic supermarket business model unsustainable.

Grocery Wars

daniel March 21, 2017 Can Supervalu Survive??, Cub Foods, Income Inequality Explains why Kroger might be reluctant to buy Supervalu, Kroger (NYSE: KR), Save a Lot, Save-A-Lot is very vulnerable to income inequality, speculation that Kroger (NYSE: KR) is planning to buy Supervalu, Supervalu (NYSE: SVU), Supervalu is a Great Investment – For Kroger, Supervalu might be a good investment for Kroger, Surprise Supervalu is Making Money, The Grocer’s Dilemma

Can Supervalu Survive??

Supervalu might be a good investment for Kroger; but it is certainly a lousy investment for anybody else with the possible exception of Safeway.

Grocery Wars

daniel January 3, 2017 A Shrinking Market, Amazon Go, An Industry in Turmoil, Are Low Supermarket Margins an Opening for Amazon?, Costco Wholesale (NASDAQ: COST), Grocers will Survive Amazon, is Amazon (NASDAQ: AMZN) really a threat to grocers?, Kroger (NYSE: KR), Kroger and Whole Foods, Sprouts Farmers Market (NASDAQ: SFM), Supervalu (NYSE: SVU), Walmart (NYSE: WMT), Whole Foods Market (NASDAQ: WFM)

Is Amazon Really a Threat to Grocers?

My take is that the major grocers; and high-end grocers like Whole Foods, will survive but many of the regional and discount chains will not. Instead of being a direct threat to grocers, Amazon will be an indirect threat taking some business and providing another headache for grocers.

The Death Spiral

daniel October 20, 2016 Amazon (NASDAQ: AMZN), Amazon has Killed Staples, Jet.com, Kroger (NYSE: KR), Office Depot (NASDAQ: OD), Sears Holdings (NASDAQ: SHLD), Staples (NASDAQ: SPLS), Staples' Dividend is Doomed, Supervalu (NYSE: SVU), Walmart Stores Inc. (NYSE: WMT), Why Staples Might Shut Down, will it buy it, Would Walmart Buy Staples?

Is Staples Close to Death?

Two interesting buyers would be Walmart and Amazon. Walmart would buy Staples for its brand and online market share. Amazon might be interested in Staples’ 1,600 brick and mortar locations as pickup points for merchandise. It needs such points to counter Walmart which has already opened 600 such pickup points.

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