I base my investment decisions on known, indisputable facts. So here are the facts on HelloFresh. As you probably know, their stock has increased dramatically over the past year. The question is whether it was (1) just a temporary bump due to Covid (people staying at home, ordering food, and cooking more) or if (2) there has been a transformation in consumer behavior and consumer habits that will lead to a further explosion in the company's fortune. Lazy logic would favor the former. But, here's a fact: HelloFresh is currently in the process of hiring hundreds of people in the USA alone, as well as hundreds in other countries around the world. And not just warehouse staff. We're talking engineers, marketers, managers, analysts, chefs, and additional managers in all departments across the board. Are all meal kit companies booming, and will all of them continue to boom? Absolutely not. Blue Apron was so promising a few years ago, but Blue Apron has bungled its strategy; its performance is weak and its outlook is bleak. Meanwhile, HelloFresh is slowly but surely dominating the market. Some "armchair sociologists" claim that HelloFresh will lose all its loyal customers as the customers learn to cook. That theory is plausible, but it fails to consider that HelloFresh is likely developing strategies and mechanisms for preventing attrition. In particular, look to its Retention Managers to develop and roll out two innovations in the near to mid term: (1) increased gamification of its UX and platform; (2) the introduction of cast-iron dutch oven recipes that will captivate and engage the more experienced members of its customer base. Picture millennials with 300-dollar Le Creuset pots who want to make lamb in the oven and take gorgeous pictures to post on Instagram, without having to go to the supermarket or really learn to cook complex dishes on their own. They will reach new "Levels" of cooking prowess and new "Squeezes" for recipe sharing -- hence "gamification" -- and they will remain loyal even as they actually learn to cook in the process. Meanwhile, HelloFresh -- and its newly-hired techs and creatives -- will continue to dominate the meal-kit market, until everyone finally wakes up two or three years from now and realizes that a true transformation in consumer behavior has taken place. So, will HelloFresh settle into doldrums in the mid 70s, post meteoric rise? Some think so -- and they, of course, are shorting. Let them short. Meanwhile, those who look at what's actually taking place in the real world -- jobs, performance, strategy, and ideas -- will realize that 80+ a share for HLFFF is just the beginning. But no need to believe me -- just check back a year from now and see for yourself.
Submitted February 18, 2021 at 10:55PM by lucky_nelson https://ift.tt/3dsOUku
