Consumer Discret Sel Sect SPDR® ETF

NIKE plans to grow DTC revenues to $8 billion by fiscal 2017, including e-commerce revenues of $2 billion. E-commerce grew 65% in 2Q15 to ~$205 million.

In the last part of this series, we briefly covered Texas Roadhouse’s (TXRH) steak-focused menu. Let’s look at it in more detail in this article.

How strong is Under Armour’s business model? In the next parts of this series, you’ll read a SWOT analysis—looking at strengths, weaknesses, opportunities, and threats—of Under Armour, Inc. (UA). We’ll also compare the company to rival firms, the overall market, and the consumer discretionary (XLY) sector. In this part, we’ll cover the firm’s key strengths and weaknesses. […]

For relatively new companies competing in an industry with many players, building a well-recognized and reputed brand is essential.

Major product lines include fitness pants, shorts, tops and jackets. It also has a range of fitness-related accessories like bags, socks, and yoga mats.

Pinnacle Entertainment (PNK) incurs direct costs in gaming, food and beverage, lodging, retail, entertainment, and other areas.

Porter’s 5 Forces, developed by Harvard Business professor M. Porter, is a model of analysis used to gauge the level of competition within an industry.

Under Armour: Sourcing, manufacturing, and distribution decisions Under Armour, Inc. (UA) manufactures virtually nothing in-house. Production is outsourced to third-party manufacturers overseas. This is common practice in the apparel industry among companies including the The Gap, Inc. (GPS) and Fossil, Inc. (FOSL). These companies are held by the Consumer Discretionary Select Sector SPDR ETF (XLY), as are United Armour, or […]

Slow growth in personal consumption expenditure may affect growth. Currently, personal consumer expenditure is $12 trillion. This is ~70% of the GDP.

The benefits of the franchise model include the opportunity for the company to grow faster because the franchisee provides the capital for making the restaurant ready for operation, and the franchisor faces lower risk if the store underperforms.

Restaurants seek revenue growth in a variety of ways, but after exhausting all options, restaurants pursue a unit-growth strategy to capitalize on these opportunities.

By opening restaurants for different dayparts such as breakfast, afternoon snacks, or late-night snacks, restaurants believe they will sell more products throughout the day and improve same-store sales.

Same-store sales are driven by two factors: the number of customers walking into the stores and the average amount or average check those customers pay for an order.

Starbucks’ (SBUX) management states that product innovation will be its primary focus as it maintains a lesser focus on its coffee business.

The two most important drivers of revenue in a restaurant business are same-store sales and unit growth. Same-store sales growth measures the growth at existing stores or locations over a period of time.

Full-service restaurants make up 44% of the market share in the United States. Full-service restaurants usually serve breakfast, lunch, and dinner.

In a company-owned restaurant, the company takes ownership of the operation at the restaurant location. The company uses its own financial resources to get the location ready for business.

Limited-service restaurants can be classified into fast food or quick service, fast-casual restaurants, pizza restaurants, and cafés.

Marriott (MAR) operated a total of 3,916 hotel properties in fiscal year 2013. Most of these properties were either managed, franchised, or licensed.

The EV to EBITDAR multiple is used in businesses where there’s significant rental and lease expenses—hotels and airlines. We’ve used this to analyze Marriott’s valuation.

Timesharing—also known as vacation ownership—is a method of getting the right to use a vacation property like a hotel or a resort. The buyer owns “timeshare interests” or intervals.

Timeshare revenue accounted for ~18% of total revenue from segments. The company generates revenue by marketing and selling timeshare interests and managing resort operations.

Hilton’s hotels, resorts, and timeshare properties are spread across 91 countries and territories. On December 31, 2013, Hilton’s portfolio consisted of 678,630 rooms.

The strengths, weaknesses, opportunities, and threats (or SWOT) analysis is a useful tool for decision-making in businesses and organizations. It helps companies identify the positive and negative factors inside and outside an organization.

Burger King (BKW) opened a net of 131 new restaurants in the second quarter, making for a total net new restaurant count of 682 restaurants in the past 12 months.

The casino industry has heavy capital expenditures in gaming machines. This contributes significantly to the total output that’s generated by a casino operator. This is why the threat of new entrants to the industry has been low.

The international gaming industry is growing quickly. It’s expanding to new jurisdictions. Many U.S. commercial casino companies, including Las Vegas Sands (LVS) and Wynn Resorts (WYNN), have helped the industry become an important part of the global economy.

Casino gaming is the largest part of the commercial gaming market. It continues to grow in popularity. There has been a surge in demand for casino games. As a result, new casino destinations have been created. Existing casinos have also been expanded.

Consumer confidence is an economic indicator. It measures how confident consumers are about the overall state of the economy. It also measures how confident people feel about their income’s stability. Their confidence impacts their economic decisions—like their spending activity.

Same-store sales are one of the important drivers in the restaurant industry. Same-store sales directly drives the revenues. It measures the percentage change in the revenues generated by existing restaurant locations over the same period last year.

XLY and XRT have performed better in terms of absolute returns over longer periods of three and five years

Average revenue per square foot To get a better picture of Darden’s business, we further looked into casual dining restaurants’ average revenue per square foot—the square feet of restaurants across primarily the United States and their guest traffic. This will help us decide whether Darden’s Olive Garden and Red Lobster brands should pick up a […]