Did Ooshies really drive up Woolies' share price?
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
The Lion King has far greater influence than just entertaining hordes of young children and those of us who love a good story, told well.
The movies and theatrical productions of this monster hit have raked in the cash.
The opening weekend of this year’s live action movie release generated $269 million at the international box office. For perspective, the beloved 1994 animated version grossed $968.5 million.
According to Forbes, the film's US takings are $512.7 million in 40 days of release, and it has earned a robust $1.01 billion internationally, giving it a current global cume of $1.5 billion.
It’s not over yet for box office takings.
Now, let’s step back in time to 2017 and the 20th anniversary of The Lion King’s stint on Broadway. The show’s global box office, including the take from international productions, was $8.1 billion.
That’s impressive, but as I said, it is not just having an influence on the box office. Merchandising is also a multi-billion dollar industry.
For $40, you can buy the 'Can’t Wait to Be Queen' eyeshadow palette by Luminess Cosmetics which includes shades named after characters Nala and Mufasa.
How about putting a flatulent Pumbaa on the mantelpiece?
Retailers are cashing in. Disney shares roared to life this year on the back of Avengers Endgame and The Lion King releases: merchandise was the cream on top.
Disney shares did drop 5% this week on a disappointing third quarter earning report due mainly to its deal with Fox.
Of course the optimism surrounding Disney doesn’t die. It is Disney after all.
“In our view, the investment thesis is the same and if we liked the stock before earnings, we love it on any weakness,” J.P. Morgan analyst Alexia Quadrani said. “With so many moving pieces between the newly acquired Fox and Disney+ launch, there are bound to be some hits and misses each quarter.”
Whilst Disney dropped this week, back home in Australia Woolworths reported great numbers.
A lot of that has to do with The Lion King Ooshies – miniature plastic animals.
You can buy a limited edition Golden Ooshie Mufasa for $350 on eBay, something you may have picked up if you’d bought $30 worth of groceries in the supermarket.
Ooshies merchandise was some of the most sought after in Australian history.
They even even made general news headlines, most notably the tragic tale of the Murray Darling Basin farmer who infamously cut one up on live television.
Katandra-based hay growers Melissa Portingale and Stephen Black took possession of a precious Ooshie, put it up for sale on Facebook to raise money to fight the drought and ended up receiving a torrent of social media abuse.
Forget the Ooshies, the farmers in the Murray Darling basin need help and they need it now.
The world has become mad, bitter and angry.
Anyway, Woolworths raised full-year profit by 7.2 per cent to $1.7 billion after a robust second-half performance, with normalised revenue for the year to June 30 climbing by 3.4 per cent to $59.9 billion.
According to Yahoo Finance, “The first eight weeks of FY20 have been even better as Lion King Ooshies collectables helped drive 7.5 per cent comparable sales growth across the company's 1,000-plus network of supermarkets.”
The $45 billion capped company’s share price spiked 0.41% on the news.
Merchandising has impact
McDonald’s (NYSE: MCD) stock price has increased from $97/share in August 2015 to $211/share in August 2019 due to continuous re-franchising and a sharp rise in margins.
Note: Shares of the company hit an all-time high of $218.15 in late July.
Those margins are partly driven by its merchandise deals.
Many of the fast food outlets, as well as supermarkets, know a thing or two about merchandising and it does wonders for their bottom line.
Bottom line: sometimes those pesky plastic toys that start school yard brawls and social media rants are worth their weight in gold.
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
