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There is a Ghost in my Restaurant

By Vestact Market OverviewNov 07, 2018 12:07
za.investing.com/analysis/there-is-a-ghost-in-my-restaurant-200197817
There is a Ghost in my Restaurant
By Vestact   |  Nov 07, 2018 12:07
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We are still waiting for final numbers from the US mid-term elections, but it is safe to say that the Democrats won control of The House and the Republicans maintained their control of The Senate. This means that we won't see any major changes to US legislation until, at least, the next elections in 2020. One political commentator said this morning, the Democrats want increased spending, the Republicans want lower taxes and we are now stuck in the middle where there is just one massive budget deficit.

Having no significant law changes over the next 2-years is probably a good thing for markets. It gives some certainty, something investors thrive on. As I look at it, US futures are higher, and the Dollar is weaker.

Yesterday the JSE All-share closed down 0.85%, the S&P 500 closed up 0.63%, and the Nasdaq closed up 0.64%.

Byron's Beats

Yesterday I took a look at the USD price of Tencent versus the USD price of Naspers (JO:NPNJn) over the last 6-months. Here are the two share price graphs below, thanks to Google (NASDAQ:GOOGL) Finance.

USD price of Tencent versus the USD price of Naspers
USD price of Tencent versus the USD price of Naspers

As you can see, during a tough period for Tencent, Naspers has actually outperformed. This means the discount gap between Naspers' stake in Tencent and its market cap has closed a bit.

What does this mean? Is the market awaking to Naspers' other assets? Or is Naspers just a less volatile proxy for Tencent? Meaning that when Tencent goes up, Naspers goes up less and when Tencent goes down, Naspers goes down less.

It is probably a bit of both. But my gut feels like it is more of the latter, unfortunately. When Tencent recovers, we will have to see how Naspers reacts.

Michael's Musings

I have spoken in the past about the rise of 'ghost restaurants'. A ghost restaurant is where the restaurant only has online, and no sit-down, customers. The advantage of this offering is that you don't have to pay the high-end rent needed to attract customers. Having lower costs means your profits are higher or more likely, your selling price will be lower.

Ghost restaurants are possible thanks to the likes of Uber Eats delivery services. Cheap delivery of food is not the only thing that Uber Eats does though. They are collecting consumer eating data on a mass scale.

With that data they are taking ghost restaurants to a whole new level. Doing analysis, Uber Eats can predict future eating trends. They then take those trends to existing restaurants, who have spare capacity. The restaurant then starts making that food item, but under a different brand name.

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There is a Ghost in my Restaurant
 

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There is a Ghost in my Restaurant

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