Anyone remember the Chipotle IPO?

[QueBert]

yes yes, Krispy Kreme is exactly the same product as Chipotle.

....

Nope, but he equated it being super busy as "it must be the best! Everyone should have bought stocks in it" Also people said the exact same thing he said about Chipotle about Krispy Kreme, you literally could edit his message and change the Chipotle to Krispy Kremes and the message could have been posted 10 years ago. I have seen a lot of places reach a level of popularity like this only to crash and burn. In fact the only place I can think of that's actually been around for a good amount of time and stayed consistently packed is In N Out.

Krispy Kreme was - hype died out
Fat Burger was - hype died out. If I went to the local Fat Burger 15 years ago, it was a 20 minute wait easy. Today I can be in, eat and be gone within 20 minutes because it's almost always empty.
Rubios was - hype died out

 

[manly]

> I don't quite understand comparing value investing (not trading) to bitcoin speculation or lottery tickets.

If you're picking individual stocks, it's much closer to gambling than if you buy and hold stock index mutual funds or ETFs instead.

You're deciding that you can pick stocks more reliably than the full-time active fund managers with better access to information than you have and who are paid millions, but still can't consistently beat the index funds.

So I think it's fair to compare 20/20 stock picking hindsight with 20/20 Powerball picking insight.

Dave, generally I agree with you but I think you're being too absolute here.

Perhaps for most people, stock picking is indeed rampant speculation. But that's because they're ignorant and have no clue what they're doing. In which case you're right, buying an ETF and holding it for decades is the better play.

But my point is that value investing doesn't have to be random or stupid. I don't think the comparison because a small investor and a fund manager is very apt; the fund manager does have tons more resources at his disposal but he has unique challenges and constraints to deal with. And part of the reason fund managers can't reliably beat the indexes is because it's hard for them to offset their own management expenses.

Nope, but he equated it being super busy as "it must be the best! Everyone should have bought stocks in it" Also people said the exact same thing he said about Chipotle about Krispy Kreme, you literally could edit his message and change the Chipotle to Krispy Kremes and the message could have been posted 10 years ago.

I re-read what eits wrote and I've never heard anybody say exactly that about Krispy Kreme donuts. You're full of it.

 

[QueBert]

I re-read what eits wrote and I've never heard anybody say exactly that about Krispy Kreme donuts. You're full of it.

Are you kidding? every location around here use to have lines like a Disney Land ride. For a number of years Krispy Kreme was the pinnacle of popularity. I've NEVER seen people go ape shit for a place like they did there. And today, all but 1 I know of has closed down. When the "fresh" sign got turned on it use to be a mad house to get fresh doughnuts. You are right they didn't say exactly what he said, but if anything they were more passionate about how much they liked it.

 

[zinfamous]

Nope, but he equated it being super busy as "it must be the best! Everyone should have bought stocks in it" Also people said the exact same thing he said about Chipotle about Krispy Kreme, you literally could edit his message and change the Chipotle to Krispy Kremes and the message could have been posted 10 years ago.

huh? No one ever said Krispy Kreme uses naturally-sourced ingredients and took an ethical/moral component to their product. A lot of that is behind Chipotle's model, and actually influences why many prefer it to many other choices.

No one. Ever--because only a fool would say that about a donut.

I agree though--Krispy Kreme became a stupid trend, but to me it never was. It is a hometown thing that I always knew, had existed for about 50 years previous to "trend!" and was always amazing. It was and is way better than those shit "Dunkin Dunots" whatever that yankees love so much and, I guess, why there was this sudden Krispy Kreme explosion up north. As if it was this "new thing" to eat fresh hot donuts. OMG STOP THE PRESSES! Let's line up around the block to eat a hot donut! Yes, that is stupid. It's not a unique idea, it's not a trend...it's been around for freaking ever. BUT--it became a national trend, inexplicably, and was stupid.

Chipotle never was a sudden trend. It has also been around for a while, but gradually expanding through major cities all over the country and smaller markets. Plus, they aren't just Chipotle. They have a few Asian bowl-style versions of their model that are starting to appear in Denver and SoCal. Krispy Kreme only ever made hot donuts.

 

[zinfamous]

Are you kidding? every location around here use to have lines like a Disney Land ride. For a number of years Krispy Kreme was the pinnacle of popularity. I've NEVER seen people go ape shit for a place like they did there. And today, all but 1 I know of has closed down. When the "fresh" sign got turned on it use to be a mad house to get fresh doughnuts. You are right they didn't say exactly what he said, but if anything they were more passionate about how much they liked it.

You didn't read what he said, at all. I went ahead and bolded the salient information to give you a head start, as I know you suffer from grapple poisoning.

when it comes to delicious restaurants with morals and uses local produce to create their delicious food, you trust your gut and support them. what other chain can you go to where the line of people waiting to order goes out the door and takes a solid 15-20 minutes in order to place your order? people sacrifice their entire lunch breaks just to get chipotle... and you didn't think that was a good sign that their stock would be a good investment?

what made them even more awesome was when they decided to divest with mcdonald's because they didn't have the same ideals in any way whatsoever.

http://www.chipotle.com/en-us/fwi/fwi_facts/fwi_facts.aspx

awesome company.

 

[zinfamous]

and Krispy Kreme didn't die out, it just shrank back to its normal, originally successful size. Well, a bit bigger and still more profitable than they were before the expansion, but they were, indeed, stupid to think that becoming popular based on one concept was a successful model for national expansion.

...they were always successful at home because they destroyed the competition that tried to muscle in. That was just their thing, I guess.

 

[manly]

and Krispy Kreme didn't die out, it just shrank back to its normal, originally successful size. Well, a bit bigger and still more profitable than they were before the expansion, but they were, indeed, stupid to think that becoming popular based on one concept was a successful model.

...they were always successful at home because they destroyed the competition that tried to muscle in. That was just their thing, I guess.

The thing that killed KKD was fat ass Americans decided almost overnight that no-carb diets would make them less fat. Business model destroyed.

Americans are still fat asses though, so apparently it wasn't KKD's fault.

 

[zinfamous]

The thing that killed KKD was fat ass Americans decided almost overnight that no-carb diets would make them less fat. Business model destroyed.

Americans are still fat asses though, so apparently it wasn't KKD's fault.

oh yeah, I forgot about that. lol--misguided trend killed by another misguided trend.

What a country!

 

[DaveSimmons]

Dave, generally I agree with you but I think you're being too absolute here.

Perhaps for most people, stock picking is indeed rampant speculation. But that's because they're ignorant and have no clue what they're doing. In which case you're right, buying an ETF and holding it for decades is the better play.

But my point is that value investing doesn't have to be random or stupid. I don't think the comparison because a small investor and a fund manager is very apt; the fund manager does have tons more resources at his disposal but he has unique challenges and constraints to deal with. And part of the reason fund managers can't reliably beat the indexes is because it's hard for them to offset their own management expenses.

I'll agree fund managers do have more constraints than individuals, like being forced to stay within the sector that their active fund is based in.

But I'll still say for almost all small investors picking individual stocks is much closer to gambling than if they pick index funds.

The consequences of getting it wrong are much more severe. If the OP had looked at Crumbs before the IPO he might have picked them along with Chipotle -- a big gain on one, a total loss on the other. The long-term risk of loss for an S&P 500 fund is almost zero unless we end up in a Mad Max future. Smaller gains than a hit stock, but much smaller risk.

Most people also won't do the work to really investigate a company to figure out its long-term value, then keep updating their research to see if the value has changed. Even if they do, there's always the risk of being blindsided by company fraud (Enron) or changes to the market (RIM/Blackberry).

It's easy for people to focus on the time they guessed right, and ignore the times they guessed wrong. If they then decide to start picking stocks they can get into trouble.

That's all just my opinion of course

 

[ponyo]

http://forums.anandtech.com/showthread.php?t=2356320&highlight=apple

http://forums.anandtech.com/showthread.php?t=2392087&highlight=apple

OP next post will be wondering why he didn't buy Google IPO. Perhaps if he looked forward instead of constantly looking back at the rearview mirror, his luck might change. Boat has sailed.

And I remember Chipotle IPO very well. I wanted to short this overhyped bloated pig several times in the past. Good thing I never did. That doesn't mean I won't in the future. Not a fan.

 

[alkemyst]

most people now debating this are trolls.

I put $10k in an admiral fund and sat on $14k 6 months later.

 

[nageov3t]

for all the people who invested their life savings in the Chipotle IPO, there are others who got in on the ground floor of pets.com

 

[MongGrel]

I've about 18K in an old SEP I should move somewhere I imagine.

The other ones doing better, but that's the only one I have a fund manager associated with, end even if a reputable firm I was making better decisions than he was.

The only time it lost money was when I listened to him about where to put things.

The Twit.

I had to let it sit and recover for awhile after one of his recommendations.

Wasn't one of the better ones anyway.

 

[zerocool84]

about 9 or 10 years ago, i went to my first chipotle. i felt in love real hard. to think that it wouldn't explode would have been ignorant.

when it comes to delicious restaurants with morals and uses local produce to create their delicious food, you trust your gut and support them. what other chain can you go to where the line of people waiting to order goes out the door and takes a solid 15-20 minutes in order to place your order? people sacrifice their entire lunch breaks just to get chipotle... and you didn't think that was a good sign that their stock would be a good investment?

what made them even more awesome was when they decided to divest with mcdonald's because they didn't have the same ideals in any way whatsoever.

http://www.chipotle.com/en-us/fwi/fwi_facts/fwi_facts.aspx

awesome company.

Sorry but Chipotle's food is bland.

 

[Ichinisan]

Quebert crapping in another Chipotle thread? That's not a surprise.

 

[Ichinisan]

about 9 or 10 years ago, i went to my first chipotle. i felt in love real hard. to think that it wouldn't explode would have been ignorant.

when it comes to delicious restaurants with morals and uses local produce to create their delicious food, you trust your gut and support them. what other chain can you go to where the line of people waiting to order goes out the door and takes a solid 15-20 minutes in order to place your order? people sacrifice their entire lunch breaks just to get chipotle... and you didn't think that was a good sign that their stock would be a good investment?

what made them even more awesome was when they decided to divest with mcdonald's because they didn't have the same ideals in any way whatsoever.

http://www.chipotle.com/en-us/fwi/fwi_facts/fwi_facts.aspx

awesome company.

I decided I loved Chipotle before I even knew of their "Food with Conscience" initiative and other awesome business practices.

 

[ponyo]

Sorry but Chipotle's food is bland.

That's how I feel as well but there are thousands of remote towns and cities in the US with zero comparable cruisine. So Chiptole is unique and exotic to them. I can definitely understand its success and mass market appeal. It doesn't mean the stock isn't overvalued pig.

 

[Sonikku]

Why didn't I buy Panzer Dragoon Saga when it just came out on the Sega Saturn?

WHY?!?! :'(

 

[Engineer]

I had my mouse cursor on the 'buy' button for Yahoo stock nearly 18 years ago (or so). Had a $5,000 buy order and chickened out. Had I bought it there and sold at the 'peak' (not likely), my $5,000 order would have turned to $750,000.

Hindsight is good....or something like that.

 

[CZroe]

You basically described Krispy Kreme, how are they doing again? I use to work with people who on a regular basis would sit in the Krispy Kreme drive thru for 15 minutes to order some fucking doughnuts.

Krispy Kreme is doing quite well, actually. You must live in a SoCal area where a franchisee mismanaged and had to close up all of his locations.

 

[ponyo]

I had my mouse cursor on the 'buy' button for Yahoo stock nearly 18 years ago (or so). Had a $5,000 buy order and chickened out. Had I bought it there and sold at the 'peak' (not likely), my $5,000 order would have turned to $750,000.

Hindsight is good....or something like that.

I remember the Yahoo IPO like it was yesterday. I wanted to buy like $4,000 or about 200 shares. I was taking intro to accounting class at Northwestern. My accounting professor came in and gave us 30 minute lecture on why Yahoo was extremely overvalued and why no one should buy the IPO. Lol. He was right for about a year. Yahoo opened at $20 and about a year later was trading down at $10. But then internet stock mania took over and Yahoo and every internet/tech stocks went crazy. That was fun times. Yahoo was my favorite stock to trade on earnings. I traded Yahoo at least 4 times a year. Yahoo float was small back then so it had crazy earnings run up and massive sell off afterwards. It was like clockwork. I used to make well over $100k a year just trading Yahoo stock earnings run 4 times a year. It was the momentum stock to trade back then and part of the Four Horsemen sort of like Chipotle, Netflix, Tesla, and Priceline are today. I would load up massively month or so before earnings and sell and short a day or two before earnings. That was fun times.

 

[eits]

I decided I loved Chipotle before I even knew of their "Food with Conscience" initiative and other awesome business practices.

same. i found out about that way later. i found out soon after i fell in love with them that they were owned by mcdonald's and i shrugged, but felt kinda icky about it. then, i found out that they broke up... faith restored.

 

[HopJokey]

Since the Google IPO, only ten S&P 500 companies have performed better than them:

http://blogs.wsj.com/moneybeat/2014/08/19/googles-ipo-10-years-later-just-10-stocks-beat-it/

 

[Craig234]

I've decided that picking stocks based on a layperson's information is quite unreliable.

You can make a case of almost anything having upside. Here are a few examples of good arguments for downside that are wrong.

- Tesla - this is some paypal billionaire's looking for a way to spend all that cash getting in an industry he doesn't know, it's been decades since a new American care company was created, all the momentum is for oversease lower cost producers - this has disaster written all over it.

- Apple - Not only is it a tech company trying to hang on to the glory of the Macintosh, it's in a crowded market of consumer electronics where the flavor of the day constantly changes and they're trying to keep premium pricing. On the off chance they get something right, others will immediately sell better and cheaper versions. And where is there to go, they've already saturated the things they can do.

- Bottle Water. This is a joke right? Soda has always been a crappy and unhealthy very cheap substance, but it had flavor that justified people spending a lot for the bottled product. Keep all the expense but make it without the attraction of the flavor? The same water everyone gets subsidized by the government for free? That if you DO want a portable container of water, get a bottle made for that and fill it for free? This sounds like the next Edsel.

- Krispy Kreme - with all the inexpensive Cambodian-run (90%, I hear) stores selling the doughnuts people like and health trends strongly discouraging doughnuts, where the hell is the market for this supposed to come from? If you build it, they will say 'bad idea to buy that' if it's a doughnut franchise.

- Home Depot - small business warehouses of home maintenance stuff were struggling - where is the market coming from for a flood of massive warehouses of the stuff?

You get the idea.

All these companies have good and bad cases, and some do well and some don't. If people make the right pick, they think their reasons are why.

I'm thinking of getting some Google - at this huge peak of a price - despite the huge risk in a company changing a lot in a market changing all the time.

Of course, I have a couple ideas for virtual worlds, if someone wants to invest in the startup, and that'll be a good investment.

 

[Mermaidman]

You can still get in on El Pollo Loco. Years from now, you'll start a thread asking why you did/did not jump on the stock and made/lost a ton of money.

Hey you could always buy RIM/BlackBerry stock right now. I bet it is pretty cheap. :whiste:

Oh no you dit unt!