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Starbucks has reportedly explored buying Chipotle. Seriously. One of the stupidest forms of desperation I can imagine. Bearish Starbucks, bullish Chipotle, bearish the whole damn thing put together. ✅ The FT says Starbucks has worked with advisers on a takeover. Chipotle jumped 6% Thursday. ✅ Starbucks' CEO used to run Chipotle. ➡️ I went through both filings on stream. By my math Starbucks has about $8.1 billion of bills due over the next year against about $4.7 billion of cash and receivables. 😇 Spoiler alert, they ain't got any money. They're broke. ➡️ So a deal means selling shares and piling on debt. That's the bearish Starbucks part. ➡️ To get Chipotle holders to say yes, I think it takes about $46 a share. It closed at $32.68. 😇 This deal just put a technical floor on Chipotle stock. 😇 You now want to train the rice and beans person to go make you a fancy latte. It just ain't going to work. 😇 Every time these businesses overcomplicate their menu, it's the kiss of death. 🚨 The risk: no offer has been confirmed. If talks go nowhere, the pop fades and $46 never gets tested.
realMeetKevin ↗