Sharing some quotes from earnings calls from some non-Focus Equity names. Thought these quotes would be interesting to share as they tie into some of the recent Q1 themes we’ve discussed…
Shopify (SHOP), cloud based platform that helps merchants create online storefronts
Theme: Rising e-commerce competition
COO, Harley Finkelstein said, “It has become increasingly important for merchants of all sizes to sell online and to have better options for getting their goods to buyers…we’re helping, getting more large merchants online in our core geographies faster… and I have to tell you on a personal level, these are brands that I’ve been after for years to join Shopify and join Shopify Plus that told me that eventually they will do it. They are now doing it. And so, in many ways, what the situation is doing is it’s accelerating the catalyst for people to move from wholesale businesses to direct consumer businesses and move from businesses that traditionally were only brick and mortar to being more in a brick and click sort of model. So pleased to see that and we think that will continue.
Regency Centers (REG), Retail REIT
Theme: Rising e-commerce competition
CEO, Lisa Palmer said, “the part of retail real estate that we operate in, I think it’s best positioned. Whatever that post-pandemic world looks like, I like the fact that we are close to neighborhoods and that we have grocery-anchored shopping centers and the quality of our real estate. It’s something that was true pre-COVID, and it’s certainly going to be, I think, even more true post-COVID as retailers continue to focus on having physical presence, which I think they still need. And if anything — and perhaps this is highlighted, some of the difficulties in the cost of delivering picking up. And that physical presence really is going to be critical as part of their overall strategy. And being close to the customer and having the best locations is going to be of critical importance to them.”
Zillow (ZG), E-commerce real estate platform
Theme: Strength in housing/home improvement
CEO, Rich Barton said, “According to MIT about half the U.S. workforce is now working from home. And they’re not just working from home, they’re teaching their kids, feeding each meal, conducting their social lives all from home. But they are dreaming about an extra room for an office, a bigger yard or less dense neighborhood or for many of you may be a new second home, there is evidence that the experience has uncorked new aspirations and hopes of what home can be and needs to be…. Amid the jolting stories of lives, jobs and business lost, we are grateful to be able to share not just strong Q1 results, but evidence of the housing markets resilience and an encouraging readiness, perhaps pent up restlessness among people who are shopping on Zillow… We have seen all our metrics bounce off the bottom. Some metrics at the top of the funnel like visits have more than fully recovered and are up double-digit percentages year-over-year, indicating to us even higher demand to move or at least fantasize about moving than before.”
Sarah Kanwal
Equity Analyst, Director
Direct: 617.226.0022
Fax: 617.523.8118
Crestwood Advisors
One Liberty Square, Suite 500
Boston, MA 02109
$SHOP.US
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$REG.US
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$ZG.US
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[category equity research]