It's Easter and what's Easter's favourite ingredient? Chocolate. Chocolate sales always increase in Easter but in a sign of the times chocolate sales fell -0.6% over Valentines (4 week period ending Feb 21) versus a year earlier. Let's hope Easter works out better I'll be doing my part with some of the products below.

Cadbury (owned by Mondelez) is the chocolate leader in Australia its products make the chocolate hall of fame you might have heard of Freddo 90 million are eaten every year in Australia, Cadbury Roses, Cherry Ripe and Picnic. During Easter many of these products turn into eggs.

There are certain brands that retailers have to stock to be in business Mondelez has a portfolio of them. They are also dominant in the biscuit category with brands such as Oreo otherwise known as milk's favourite cookie with 35.9% share of the US market in 2015. Over the last two years Mondelez's profitability has increased substantially but at the cost of sales. They used to have 74,000 product varieties its down to 30,000 today. Less choices for you means greater profits for Mondelez.

Chocolate is still a good investment though growth is slowing. Snacking is a $1.2 trillion market with emerging markets just beginning to snack. Branded chocolate typically have good margins, when was the last time you craved private label chocolate? We all want our Cadbury. Let's hope you get it Happy Easter everyone.


Decisive does not have a position in Mondelez (MDLZ). The material in this article is for informational purposes only and in no way constitutes a solicitation of business or investment advice. The material has been prepared without regard to any client's or other person's investment objectives. Before making an investment decision you should consider the assistance of a financial adviser and whether any investment or service is appropriate in light of your particular investment needs.

Best performing stocks since the market bottom

It's been 7 years since the GFC stockmarket bottom. How things have changed. Apple was only the 15th largest company in the world with a market cap of $74 billion on the 9th of March 2009. Today Apple has a market cap of $561 billion (including $216 billion cash) the largest company in the world. Energy has been a notable laggard Exxon Mobile once the largest in 2009 is now the fourth largest in the world.

Source: Bloomberg numbers total return

Hopefully you own some of the best S&P500 performers since the bottom above. Hindsight investing is a lot easier but property and hotels were the top two performers followed by consumer discretionary which dominated the list. Underwear seemed to be a standout with L Brands (owner of Victoria Secret) and Hanesbrand making top appearances. Interestingly a lot of the top performers are fairly well known brands.

The material in this article is for informational purposes only and in no way constitutes a solicitation of business or investment advice. The material has been prepared without regard to any client's or other person's investment objectives. Before making an investment decision you should consider the assistance of a financial adviser and whether any investment or service is appropriate in light of your particular investment needs.

Tinder and Buffet not yet a Match

Buffet released his annual letter last week and as usual its a must read. The one surprise I had was Buffet mentioning Tinder saying that he was not ready to use it (see below). I was amazed he had heard about it, you've made it as a service once you're mentioned in his letter. Tinder has entered popular culture becoming a verb for meeting people online.

Tinder is a part of Match group alongside 45 other dating brands. Buffet doesn't use it so it might not pass his investment process but its interesting because Match.com is an established business with great cash flow partnered with the future growth potential of Tinder. All up they have around 59 million monthly active users with 2.5 million confirmed marriages. Match Group was spun out of Interactive Corp late last year whose track record of spin-off's include Expedia, Tripadvisor and Lendingtree.

Online dating is mainstream
If you weren't on a Valentines date last month you're very likely married or looking at online dating sites. The market for singles is expanding people are marrying later and online seems to be the best chance of meeting someone outside of friends and work. In the 70's 28-30% of Americans were single compared to 45% today (2014 US census).

Tinder has become a phenomenon it's how young people meet. It's a first impression swipe right if you like someone app. 3Q data has users swiping 1.4 billion photos a day with 9.6 million daily active users spending on average 35 minutes swiping through photos. If you haven't heard of it you must be over 35, 86% of users are under 35.

Tinder swipe right
Match has grown as online dating has become mainstream. But they do have difficulties Tinder monetises at a lower rate as most services are free, on average Tinder revenue per user is 50% lower than Match. Though Match argues that as people get older they upgrade to paid services to figure out who is serious in finding a long term relationship as compared to a shorter term Tinder crowd. Out of all of the IPOs last year Match Group was one of the more interesting having both good cash flows and future growth through Tinder it's one to swipe right and stay connected to.

Decisive has no position in Match Group (MTCH). The material in this article is for informational purposes only and in no way constitutes a solicitation of business or investment advice. The material has been prepared without regard to any client's or other person's investment objectives. Before making an investment decision you should consider the assistance of a financial adviser and whether any investment or service is appropriate in light of your particular investment needs.