🛍️ Walmart’s cart conquest

…and Deere faces the farm headlights (Adam Davis/Shutterstock) We have Sweetgreen at home   Hey Snackers, The Olympics are over, but a lifetime supply of noodles lasts forever. A gymnast who won two golds for the Philippines has been offered [unusual prizes](, like endless mac and cheese, a house, wedding photography, fog lights, and free colonoscopies. Don’t call it a comeback: the S&P 500 and Nasdaq sealed a six-day win streak yesterday after news that US [retail sales popped]( 1% in July —about 3x more than expected. 😎 Risky quizness: Test how well you know the latest business news by taking this week’s [Snacks Seven]( quiz. Try the first Q: - What’s the first NFL franchise to be valued at over $10B? ([Check your answer](.)   CARTED [Walmart serves up a home-cooked earnings beat as consumers go for value]( Overflowing cart… of half-priced paper towels. Walmart shares jumped 7% yesterday after the world's largest retailer [unloaded]( an earnings beat. Its revenue grew 5% to $169B last quarter as its global ecomm sales jumped 20%. Walmart said higher-income customers accounted for most of its new customer gains as shoppers traded down. Even after rolling out price cuts and summer sales events, Walmart boosted its annual profit and sales forecast, signaling demand is strong. Merch sales (think: air fryers, sun dresses) rose for the first time in 11 quarters — a good omen for consumer spending. - The Costco effect: Walmart’s Sam’s Club attracted record-high memberships in Q2, with half of new sign-ups coming from Gen Z and millennials. “We’ve got Chipotle at home”… Even after annual inflation hit its slowest pace in three years, food prices have stayed high, especially at restaurants. While US grocery prices are up 1% year over year, restaurant prices have popped 4%. As folks opt to save $$ by cooking at home, discount retailers are in a sweet spot. Walmart’s dominated in groceries — which make up over half of its US sales — capturing a record 37% of online grocery sales in Q2. Rivals like Target and Aldi have cut prices to keep up (FYI: Target reports on Wednesday). Meantime, chains like McDonald’s and Starbucks have been pushing “value” with promos as their sales fall. THE TAKEAWAY It pays to have the right price… As inflation eats into budgets, shoppers want more bang for their buck. Picture: buying Keurig pods in bulk versus a $6 Starbs cold brew. Walmart’s prices are estimated to be ~25% lower than traditional supermarkets, giving it an edge over grocery rivals. As consumers prioritize value, discount retailers appear poised to thrive. [Read this online]( A message from Sherwood Traders, titans, trailblazers… under one roof Curtain call… See Sherwood Live on the Main Stage at HOOD Summit 2024 — the place to be for a new generation of active traders. An iconic Miami venue… Brought to you in partnership with Robinood, you’ll hear keynotes and discussions on the future of fintech and the culture of money — then feel it come together at our capstone party at iconic venue [Faena Forum](, where we’ll party with DJ sets and bring together the best of food, drink, technology and art in the heart of Miami Beach. Now’s your chance to secure early bird pricing. [Register for HOOD Summit 2024 here](. A message from Sherwood Traders, titans, trailblazers… under one roof Curtain call… See Sherwood Live on the Main Stage at HOOD Summit 2024 — the place to be for a new generation of active traders. An iconic Miami venue… Brought to you in partnership with Robinood, you’ll hear keynotes and discussions on the future of fintech and the culture of money — then feel it come together at our capstone party at iconic venue [Faena Forum](, where we’ll party with DJ sets and bring together the best of food, drink, technology and art in the heart of Miami Beach. Now’s your chance to secure early bird pricing. [Register for HOOD Summit 2024 here](.   CROPPY [Deere’s losing traction as US farms struggle through a hot, expensive year]( Oh Deere… Deere’s quarterly earnings showed that the world’s largest farm-equipment manufacturer has a cornucopia of [problems](. Sagging demand for its green-and-yellow tractors plowed into sales, which fell 17%. Profit plunged 42%. Still, the drop was less than analysts expected, and Deere stuck with its annual profit forecast. The stock popped 6% yesterday (its biggest daily gain in over a year). It’s been a bumpy road for the company. - Reaping and sowing: Deere has laid off an estimated 1.5K US workers recently, drawing ire from unions. The UAW — which held a five week, 10K-worker strike against Deere in 2021 — blasted its $43B in stock buybacks over the past two decades. - Diversity retreat: Last month Deere said it would end its diversity-and-inclusion efforts following conservative pressure and a similar move by Tractor Supply. It came just weeks after Deere paid $1M+ to resolve allegations of discriminatory hiring. Not bringing home the bacon… The USDA forecast that this year farms will rake in $116B, down 27% from last year and down 41% from 2022. That’s the biggest two-year decline in over four decades. Corn prices fell to below $4/bushel in July, marking a 37% drop from last summer’s peak. Seed and chemical costs have spiked, and intense heat waves and droughts have damaged crops and livestock. All these problems have hurt farmers’ ability to invest in shiny new equipment from companies like Deere. THE TAKEAWAY Cost cuts are investors favorite “cover crop”… Deere’s profit-pumping moves (layoffs, higher prices) could help offset slowing sales and cratering earnings. Investors have cheered similar measures from other companies. But companies can’t cut costs forever, and like cover crops, those moves can’t be harvested for long-term growth. [Read this online](   MEMEY The Crypto Catch-Up… 📜 Policy… Crypto insiders and Democratic lawmakers [gathered]( Wednesday for a digital “Crypto4Harris” town hall. As many in crypto [embrace]( former Prez Trump, the group argued that a President Harris would be good for the digital-assets industry. 🤔 Sus… The [SEC sued]( crypto co NovaTech, alleging its founders fraudulently raised $650M+ from 200K investors. The biz promoted itself as a crypto-investment operation, but regulators called it a pyramid scheme that targeted Haitian Creole-speaking churchgoers. 🌶️ Spicy… Some traders are sick of the [deluge]( of new meme coins after Pump.fun made it free to launch solana-based coins. As of Saturday, users had created 1.7M meme coins with the platform. Only 41 have maintained a $1M market cap.   ON SHERWOOD [Why your parents should buy you a house]( who want to buy homes face an uphill battle. Their boomer parents have $76 trillion in wealth. You do the math. [Read More.](   What else we're Snackin' - [iBot](: Apple’s said to be building a device with a “thin robotic arm” meant to move a screen. iPhone sales have sagged, but Apple’s attempts at new hardware have been iffy (abandoned car, underselling headset). - [Tote](: Tapestry, the owner of Kate Spade, Coach, and Stuart Weitzman, said its quarterly sales fell, led by declines in China. Designers have struggled with a weak recovery in the key luxury market. - [TopCop](: VP Harris reportedly will back a ban on price gouging in the face of cooling (but still sticky) inflation. Corporate profit margins have soared, with cos like Pepsi and Kellogg upping prices by double digits. - [BankNPL](: Buy now, pay later biz Klarna is launching a checking-account-like offering to better compete with banks. It’s Klarna’s latest move to grab market share as it preps for an expected US IPO. - [AInswer](: Google’s expanding its “AI Overviews” to six new countries. The rollout of AI summaries at the top of search results was riddled with issues, including inaccurate answers ([glue-topped]( pizza, anyone?).   Snack Fact of the Day [July had the highest global temperatures on record](   Friday - University of Michigan consumer-sentiment survey for August - US housing starts - National Work from Home for Wellness Day - World Ploughing Championship Authors of this Snacks own shares of: Alphabet, Apple, Starbucks, and Walmart   [Instagram]( [Twitter]( [Sherwood Logo]( Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... [See more]( [Sherwood Terms and Conditions]( [Our Editorial Standards]( [Contact Us](mailto:hello@snacks.robinhood.com) [Advertise With Us](mailto:advertising@sherwoodmedia.com) [Unsubscribe]( [Privacy Policy](