NoBull Posts

The Importance of the Balance Sheet in Financial Analysis
While most investors are focused on sales growth & margins, they would be well served to further consider the strength of a company’s balance sheet. We look at BlackRock’s financial condition as an illustrative point.

The Importance of Free Cash Flow in Financial Analysis
Cash represents the lifeblood of all business enterprises which is why it is important to analyze free cash flow which we define as operating cash flow minus capex, dividends, and stock buybacks. We illustrate DoorDash as an example of why cash flow analysis is so important.

Lessons From Tucker Carlson
There are many theories about why Fox booted Tucker Carlson, but it may be a very simple reason which can instruct everyone involved in the consumer retail segment.

It is Imperative that Climate Change Regs Incorporate Economic Reality
This week we spotlight efforts by international agencies to lower the earth’s temperature by imposing onerous regulations on energy producers. We suggest it will be better to: begin a process of implementing continuous improvements designed to support both economic & climate progress; and use international organizations to share tech & best practices as opposed to providing them with regulatory powers best left to individual nation-states.

Part 3 – It’s Nice for the US to Save the Climate, But What About the Rest of the World?
In our last 2 posts, we outlined the probability that the UN’s push to lower the world’s temperature by -2 degrees Celsius could drive significant U.S. energy price hikes & shortages. How is this going to help as Asia ramps up the use of coal? Can humans lower the earth’s temperature anyhow?

Part 2: Who is Left to Make Investments in Fossil Fuels & Clean Energy?
There is not a lot of incentive for profit-seeking companies to invest in demonized fossil fuels or in clean energy projects lacking ROI. This points to substantially higher energy prices and supply shortages that will have a profound economic impact.

Part 1: Ramping Energy Demand Clashes with UN’s Environmental Goals
From 2021 to 2050, ExxonMobil forecasts that 85% of the population growth will be driven by developing countries, which in turn, will drive a +15% increase in energy demand.

What if the Federal Government Was Turned into a 501c3 Non-Profit?
Given all the focus on the debt ceiling, we propose a thought experiment in which all 100 federal agencies must compete for charitable donations. If taxpayers get to choose for themselves what to fund, what might we learn?

Like Sinatra Croons: “So you see it’s all up to you, you can be better than you are.”
The top-paid hourly workers are currently enjoying the fastest wage growth, indicative of the current challenge to recruit & retain a skilled labor force.

Switching Jobs Paid Big Time in April
While declining labor turnover was a common theme during the 1Q23 investor calls, wage data shows that there is still good reason for employees to job-hop.
RR Posts

RR 2023 Wendy’s Report
While Wendy’s has done well to magnify its significant menu prowess sufficient to generate a respectable +18% cumulative U.S. comp growth from 2019 – 2022, the chain must continue to work to translate its QSR+ positioning into increased frequency from a higher income demo sufficient to drive a higher check and store level profits.

RR 2023 IHOP Report
IHOP is well positioned as the largest player in the $1B+ family chain segment with 30% market share and the largest marketing budget in the segment. The chain is well known for: an unexpected twist on “all things breakfast, any time of the day”; world famous pancakes; flavored syrups; and the never empty coffee pot

RR 2023 McDonald’s Report
While McDonald’s is well positioned for the long-term with solid execution around sound fundamentals, the current macro environment may prompt its core value-oriented customers to demand more deals and concessions than the system is prepared for.

Unit Level Dashboard May 2023
Strong Sales & Lower Commodity Prices Bolster 1Q Margins

Dashboard Capital Markets May 2023
It looks like we may get the promised “soft landing” for the restaurant industry as employed consumers continue to have some money to spend while restaurant operators are poised to enjoy some well-deserved margin relief.

Jack in the Box 2023
While Jack has done a great job of reviving an iconic West Coast brand in a crowded field, it remains to be seen how the chain’s value equation will fare over the medium-term given a turbulent macro environment amplified through a problematic California lens.

Chili’s 2023
While Chili’s has been able to distinguish itself in a crowded FSR space with an attractive Tex-Mex menu, fun experience, leading value and digital strength, the chain’s immediate challenge is to survive the onslaught of economic pressures on its value oriented customer base.

Unit Level Dashboard April 2023
As lower inflation (relative to grocery stores) has provided an important tailwind for restaurant industry sales since 2022 (as it provides consumers with a greater reason to eat-out relative to home cooking), it is important to monitor this gap going forward.

Dashboard Capital Markets April 2023
A check-up on restaurant stock performance through March 2023 reveals a favorable industry outlook.

Panera Bread
While Panera is well positioned for the long-term with a healthy halo and digital strength, near-term results may be tempered by the need for more value in a difficult economy and the need for a higher level of labor efficiency to support store-level profitability.