In this podcast, Motley Fool contributor Rick Munarriz and host Deidre Woollard discuss:
- Disney's ability to cut costs.
- How Disney plans to extend its IP into gaming.
- ESPN's power moves.
Deidre and Motley Fool analyst Kirsten Guerra explore the complicated logistics that drive 1-800-Flowers.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.
This video was recorded on Feb. 8, 2024.
Deidre Woollard: Disney waves some magic wand of savings. Motley Fool Money starts now. Welcome to Motley Fool Money, I'm Deidre Woollard here with Motley Fool Analyst Rick Munarriz. Rick, how are you doing today?
Rick Munarriz: I'm doing fantastic today do you think?
Deidre Woollard: Well, I'm wondering if Disney's earnings have something to do with that 'cause I consider you to be Disney-ficionado, Disney bull perhaps. Last night's earnings, it seemed to be it was definitely all over the place. But it seemed to send the message that the strategies working earnings per share were up. Company's really done so well at cutting costs, cut $500 million in SG&A expenses. They're headed toward that $7.5 billion goal. It's not the most thrilling thing we've ever heard, but how important are savings to Disney right now?
Rick Munarriz: Right now, it's very important. Again this 7.5 billion, this was $5.5 billion a year ago when back in February of 2023 Bob Iger said hey, I think we can save $5.5 billion in annualized savings costs. In November, just a couple of months ago they said all right, we can actually raise this 7.5 billion. Now he's saying meet or exceed 7.5 billion that exceed word is new. The fact that savings are happening and you're saying great, what does this mean? That Disney found a few more Disney dollars under its seat cushion sofa. But what it means is Disney right now on the top line, isn't a very exciting story organically. It's had a couple of movies basically strike out at the box office. Cord cutting is hurting its legacy business. It's theme parks which have been strong, attendance has been sluggish the last couple of quarters at Disney World and Florida strong everywhere else. It's not running on all cylinders on the top line. If it can save money and improve as an earnings story which is exactly what we saw play out this quarter, I think it will continue to get investors excited the way it did this time around.
Deidre Woollard: It seems like investors were pretty excited about that. They were increasing the dividend. It's not where it was before they had to stop it during the pandemic, but it's up 50% from the last dividend, so that certainly seems like a good start. They announced some interesting things. Let's start with the first one, which is $1.5 billion stake in Epic Games. It seems like it's a little bit about the Fortnite brand, but it seems like it's more about bringing gaming opportunities to the Disney IP. I'm both ways about this, I see Netflix and others doing this. I know gaming is very popular. What should we be looking for here? It's probably going to take at least a year or so, I think for this to figure out if this is money well spent.
Rick Munarriz: It's going to take time, this isn't something that you just snap your fingers and pixie dust and everything Disney is now, you can just walk into Toy Story in the middle of a Fortnite realm. But I do think that it's a good move for Disney on the gaming end. They've always struggled when they try to do it in house. Their best successes have been when they license it out to someone. This is their partners with Tim Sweeney, the CEO of Epic Games they've worked with him before. This makes sense and Fortnite, who knows what'll be popularity wise a couple of years ago. It seemed to be sluggish a year or two ago, but it's had a resurgence since the end of last year, where it'll be by the time this launches. But the important thing about Fortnite to me and the whole Epic Games universe, is 85% of the gamers on Fortnite are 35 years or younger. This is a demographic that Disney needs to reach if they want new blood especially a lot of younger people that are very jaded. They're not listening to branded ads, consumers, they're not even consuming ads for the most part. This is a way to reach out to them and push out their franchises and eventually some e commerce opportunities they were talking about through this venture. I think it's a good move and again, it's hard to talk about a $1.5 billion investment when Disney's trying to save money on the other hand. But I think there are times where you do have to spend money to make money and to remain relevant, and I do like this deal.
Deidre Woollard: Well, you've mentioned something about attracting younger viewers. Our colleague, Ricky Mulvey, made a list of some of the new things they announced and they aren't that new. I mean, everything seems to be either a sequel or an extension of existing IP, like Dead Pool 3, Inside Out 2, Moana 2, you've got a new Lion King movie. I mean, yes, you're betting on sure things, but also is there some concern that there just isn't any place new to go for this company?
Rick Munarriz: I think there's a balance of everything here. Inside Out it was just a new franchise just a couple of years ago. You do have a case where franchises happen. Again, we can look at like Billy Joel putting out, writing his first song in 30 years, but people are still going to the Billy Joel concerts, still selling out Madison Square Garden. Not that Disney wants to retread everything that it's put out before, but there's familiarity. The fact that we're getting a Lion King movie, a Moana movie, a Dead Pool, Inside Out, an aliens movie, a Planet of the Apes movies, all this calendar year from Disney after they had such a terrible year last year. Makes me feel comfortable that, hey, this is going to be a good year for Disney at the local multiplex. Whereas if it was just a bunch of unproven properties, I hope some of these brand-new hits hit because a franchise always starts with that first movie. I do think that if they were relying too much on it, you get to the problem of what Disney had, where they just play it safe and that got them into trouble before. But right now, when they need hits, you're going to go to your moneymakers, and I think that's what they're doing right now.
Deidre Woollard: At least on the streaming side, they'll have a little extra dose of Taylor Swift. That will help as well because they announced the Eras movie with additional content, so they'll get this.
Rick Munarriz: March 15, every Tate fan out there already has that date circled ready. Whatever era is, they prefer Taylor's version ready to go?
Deidre Woollard: Well, let's switch from Taylor to sports. Let's talk a little bit about ESPN.
Rick Munarriz: Isn't Taylor sports anyway? These days she's always at a.
Deidre Woollard: Of course she is. It is The Taylor Bowl this year. Let's talk a little bit about ESPN. I mean, I've been watching what they've been doing with ESPN for a while and they keep talking about what they were going to do next and not really delivering. Now it seems like we've got some real concrete plans. You've got two things happening. The first is came out the day before earnings, they announced with the ESPN Linear Network. That's going to be in what they call the Skinny Sports bundle with Warner Bros Discovery Fox. Then there's also going to be the direct to consumer ESPN streaming service that comes out in the fall of 2025. What fascinated me about this was the sports bundle, the Wall Street Journal called it a blind side to the sports leagues. Does this change the game for them?
Rick Munarriz: Not that it changes the game, but it makes sure that they're the ones running the ball. Just as ESPN has been the dominant sports leader. This is a company I given said CNBC right before the earnings squall right after the report, he's saying, hey, I'd rather be a disruptor than being disrupted. He's known for years that cord cutting is basically eating away at the legacy, carrier rights that they have through the cable networks and the satellite television. He doesn't want to turn their backs on them. He struck deals with them to try to, keep them afloat. But he knows that the real money has to come from the streaming side. It's better for someone else to get together with two of its biggest rivals in sports content to create that skinny bundle or to go directly over the top and reach consumers directly the way it is with the ESPN and the larger ESPN offering that's coming out next year, in the fall of next year. I do think that it's the right move and I don't think the leagues will be too upset. There are people upset that the watch a playoff game on Peacock, this NFL season, so it's better to have just the network that everybody knows is the one that do it, rather than go, oh, it's Thursday? Do I need to fire up Amazon Prime this time? Do I need to have YouTube TV to catch the NFL Sunday ticket? There's a lot of weird choices people have to make. ESPN is like the default setting, so I think anything they do is a good thing.
Deidre Woollard: I've experienced that myself in trying to figure out where something I want to watch actually is located. The other thing I find interesting about this is the ESPN solo thing, because you mentioned that CNBC interview with Bob. I listened to that too, and you described that experience as more immersive with shopping and with betting. It didn't come up on the earnings call, but I'm very curious about their sports betting business. Their collaboration with Penn seems like it's certainly being promoted a lot. But is it going to be a while before we actually, hear how it's doing and it ends up in the reporting?
Rick Munarriz: I think Disney they've always tiptoed around the gambling aspect of it if you go on a Disney cruise ship. Again, I haven't been on it in a couple of years, but every time, that's the one cruise line where I know I'm not going to go to a casino because they don't have them. At least they didn't have them a couple years ago. They've been very careful about this, so obviously they weren't just going to launch their own online sports book. They, start to deal with Penn for ESPN bet. It's been out for a couple months now. It makes sense that if you're going to be doing it a point now, everybody, everything's fund this drafting this, it's MGM bet this. The sports books are everywhere, they're commonplace. It will become acceptable for Disney possibly to do it on its own eventually. But right now, I think it makes sense if you're putting out this bundled package of sports programming, you may as well realize that I'm reaching fans, fantasy sports fans of actual wagering on games. Why am I not cashing in on this when they are basically in the driver's seat.
Deidre Woollard: If it's a stand-alone streaming thing, is there a point where you're betting with your remote? It sounded like that was what Iger was hinting at.
Rick Munarriz: Yeah, and it was. Fubo TV to bring out a company that basically, hates this news because they thought they had this market cornered and they basically, got crushed the Brother and the Fox and the Disney ESPN Collection they hate that. But you could have actually used your remote. They were trying to set it out before they pulled out of the online sportsbook market, where you can use your remote or an app tied to what you're watching. Real time, it follows you so it knows what you're watching. You get real time bets on your phone. Who knows what the future will be. Hopefully, again, and gambling is an addiction. Hopefully it's done in a way that doesn't, destroy us all. But clearly, it's a money making opportunity for Disney.
Deidre Woollard: Definitely. Well, speaking of money making a little bit, you mentioned earlier the parks in experience business, it's great globally, you mentioned that weakness domestically. Some of that, they're coming off the 50th anniversary celebrations. There's a lot of media out there about it's too expensive. A lot of families complaining. You're in Florida, what have you seen?
Rick Munarriz: It is expensive every year, and it's not just Disney World, the rivals too. One of them raises prices, the other one's going to raise prices, if annual passes get more expensive, sometimes Disney even stop selling annual passes. They do that in Disneyland, and they even did it for a little while at Disney World that they're saying, there's just too many people in the parks. Now it's the opposite where they want more people in the parks, they're putting more promotional aspects to it but I think there's a lot of factors into it but, again, Disneyland is doing fine. They opened a year later, about technically nine months after Disney World. Disney World opened in July 2020, Disneyland in April 2021 so the whole travel revenge travel phase played out earlier in Florida than it did out in California but you do have a case where they had that 100th celebration. Disney World opened a couple of really big rides, two very game changing roller coasters, and two of its steam parks, but that ended. That was back in March and since then things have been pretty sluggish. I do think that it's a matter of everything settling and the economy settling and saying, we're comfortable again to start traveling again. By no means is Disney World, this vast Tumbleweed Wasteland. It is very crowded, especially during the holidays but I do think that it could definitely use a little love right now. It is a little expensive. That comes with the territory but even though they've had like attendance, maybe the same that it was in 2019, they're generating 40% revenue per capital, higher than they did in 2019. People are paying more, there's premium experiences you can buy to get into the fast pass lane, the old fast lane which is lightning lane now. They do have things to take more money out of you, extract more money out of you, which is what all the other theme park operators do. Disney was just the last one to hop onto that bandwidth.
Deidre Woollard: From fast to lightning. They're spending more money on the parks themselves. It sounds like they are doing some investing there. Even as they're trying to save money, they're still investing in the parks.
Rick Munarriz: Yeah. I was at Disneyland two weeks ago so I covered both coasts just in this past couple of weeks. Next week I will be at Disney World, so I'm there often. There's a lot of construction activity happening in both parks, both resorts. But Disney said just a couple of months ago that they're going to spend $60 billion in the next decade in capital expenditures for their theme parks and experiences. This includes their cruise ships where they keep expanding their fleet but mostly going into their theme parks and we're seeing that a lot of upgrades are happening. We just had some big upgrades in Asia for the two parks two resorts over there and you're going to see this happen in the US in the next couple of years.
Deidre Woollard: I wanted to also talk about, they're taking page out of Netflix's book, there's sharing crackdown. We've heard this from them before, we heard it a lot more this time. They want that same success that Netflix had, they said it's one of these things that gives us confidence in our subscriber growth numbers. They really feel like they can do this. Is it the same thing? Is this an apples to apples comparison in your view?
Rick Munarriz: On the one hand I would say no, Netflix has earned the right. They are the standard cable of streaming services. You have to have Netflix or not you're going to be relevant the next time you're together with friends talking about what they're watching on TV. Disney Plus is not so much that case, but again, if you have a family, you're going to need to watch Blue movie. The reason that a Moana movie is happening in November, they're working on a direct, it was going to be a series going to be on Disney Plus they said, this is coming out so great, we're going to turn it into an actual movie that will come out in November, was because the Moana movie was the most streamed movie on any platform including Netflix in terms of hours viewed in 2023. They have the data on what's important, they are very relevant in that regard. Let them flex their muscles. Netflix again, a lot of people said Netflix is going to suffer when they're cracking down on password sharing and now we've seen a couple of quarters and Netflix is doing just fine. I don't think every service can go ahead and do this, but again, you can't blame them, they're leaving money on the table. If they're letting people do this out of just the goodness of, we need our numbers, we can't churn, we can't have a high turnover rate. At the end of the day, Netflix is proving that we can do this, you can do this too.
Deidre Woollard: They tried a lot of things, they tried a lot of things this quarter. It was a great quarter. The market seems to love it so far. One person who didn't love it is Nelson Peltz, the activist investor who's been trying to get on the board and is still trying to get on the board. CNBC reached out to his company after the earnings and they said, we've seen this movie before. I don't know because they have this site called Restore the Badge and they've got these shareholder letters and just is pretty much doing everything that they asked them to do. What do you think they're trying to see here?
Rick Munarriz: They got burned last time. They were going to have the proxy battle talk to Iger and they came to terms, it's all right, we're fine. We like what he's doing, and apparently there wasn't enough for them, so they're launching this other battle. They're going to be a little more skeptical this time around. But again, Disney did everything in this quarter, not so much, just blow out earnings and increase, they could probably have bigger savings than expected but just notice one thing that I think no one ever really talked about, but to me it's very interesting. It was February 7, 2024, and they announced a dividend increase that's going to happen in July. I've never seen a company announce an increase for something that happens five months from now. To me this was them saying, we know our annual shareholder meeting is in April. It is our last time to speak up. We're going to throw everything possible to load this chamber with everything we have. Tell you about that Moana movie in November that no one was expecting, all these other things that are happening. The dividend need is their way of saying, we have this. Again, 45 cents every six months for a stock that's over $100, that's less than 1% yield, a second excite income investors, but I do think it's definitely their way of saying, hey, we came to play with this earnings report and we had enough little stuff in there to please everybody. I don't think that Peltz will be successful this time, but it doesn't mean that he doesn't have good ideas.
Deidre Woollard: Yeah, that's true. Well, thanks for talking to us quickly Rick.
Rick Munarriz: Thank you.
Deidre Woollard: We talk about a lot of stocks on the show, but it's just a peek at the Motley Fools investing universe. This year we're rolling out a new offering, it's called Epic Bundle. The service includes seven stock recommendations every month. Motley portfolios and stock rankings, all based on your investor type. We're offering Epic Bundle to Motley Fool Money listeners at a reduced rate as a thanks for listening to the show. For more information, head to fool.com/epic198. We'll also include a link in the show notes for you. You may know the name 1-800-Flowers but there's more than Valentine's Day roses going on there. I spoke with Kirsten Guerra about the business behind the name.
We are in Valentine's week mode. It's love season, so people may be sending something special to someone special, but as you may have guessed, it also is a massive week for florists. In fact, I was doing a little digging with the Society of American Florist. It's about 30% of transactions. But we're not going to talk just flowers today, we're going to talk 1-800-Flowers, a ticker FLWS. Kristen, it's the flower company but it's a lot more, right?.
Kirsten Guerra: Yeah. The name here is a little deceptive and certainly outdated. Relatively, very few orders still come in through the phone despite the preserved toll free number and the dot com naming is a relic of its 1999 IPO, but it's a brand well known by the name. Today, 1-800-Flowers is only one brand under a much larger umbrella. In 2013, they started talking about what they call the celebratory ecosystem, which is their idea that they wanted to be like the go to place to order all types of gifts online, and that started a long series of acquisitions for them. Some may recognize acquired names like Shari's Berries, Shari's Cookies, things remembered, certainly Harry and David, in some cases, they built and launched a few lines of their own as well. So 1-800-Baskets, simply chocolate, things like that. What all that means to the end consumer is that if you're looking to send someone a gift, you can start on the website of any one of their properties and you're presented with a wide variety of options. Whether that's flowers, fruit baskets, popcorn, little monogrammed, knick-knacks through personalization mall, pastries through Wolferman's bakery, or even seafood through brands like Vital Choice. They've really tried to build out a one stop shop gift giving experience. Of course, they've also got a loyalty program to go along with that, where subscribers can get discounts, early access, free shipping, other benefits like that. In a way that works out for them if they send enough to gifts through the 1-800-Flowers ecosystem and that keeps the dedicated gift givers coming back. So yes, overall, certainly way more than flowers today.
Deidre Woollard: Celebratory ecosystem. Not a phrase I've heard before, but I love it.
Kirsten Guerra: No, for me I find it to be questionable branding. But it's not something that they sell with. It's just an internal name.
Deidre Woollard: Well, one of the things that is anxiety provoking about when you're ordering things online is you never know if the picture that you're getting is what the recipient is getting. A lot of times there's that disappointment of like you see this beautiful bouquet or you see this abundant gift basket. Then the person sends you a picture of what they got and you're like, I don't know, but it seems like 1-800-Flowers. They're very into quality control and really delivering what's online, delivering on those expectations. How do they do some of that?
Kirsten Guerra: That really is such an important part of gift delivery like this. Not only that the gift arrives looking how you expect, but also that it arrives exactly when you expect. In the logistics of that, to your point, is actually incredibly complicated. Especially when you consider that people often want to send flowers or gifts right around the same times of year, for example, Valentine's Day. There's an added layer of difficulty when you're telling customers like 1-800-Flowers is, hey, I see you're ordering flowers, would you like to add some chocolate covered strawberries to that? Fortunately, 1-800-Flowers started a heavy investment cycle around 2019 into the back and tech required to make those intelligent cross product suggestions for up cells, making sure that they're in the same warehouses for delivery and things like that. To that point they also revamped their warehouses to be brand agnostic, making it far easier to fulfill those multi-brand bundles and those are really key to the business. When I say multi-brand bundle, you can think like they mentioned actually in their latest earnings call in New Trio for them, which is a bundle of 1-800-Flowers, roses, Harry & David Wine, and Shari's berries chocolate-covered strawberries.
That's a multi-bundle or a multi-brand type of purchase. Only 13% of customers purchase multi-brand, but those multi-brand purchases account for 28% of revenue. That's a big area of potential future growth for them. It was critical, it turns out, very timely for them to make those big investments. Topping it off, they also layered on a lot of automation in their distribution center. For example, before they re outfitted one of their largest facilities in Ohio, it could handle around 80,000 packages on a peak day. Remember, peak days are critical for this company. They can generate a substantial amount of revenue, but all concentrated in deliveries that are supposed to go out on the same day, so 80,000 pre-automation and afterward that same facility, could handle 125,000. More than a 40% increase in output just in that one facility. All while cutting labor costs by about a third, which is really an even bigger deal for a company like this that requires a lot of seasonal workers. To your initial point that I think I've strayed from a bit, that automation also really helps ensure the consistent quality in all deliveries and also the quality of the product itself that 1-800-Flowers is really known for.
Deidre Woollard: I'm old enough to remember when the CEO, Jim McCann, used to do his 1-800-Flowers commercials on TV. I don't think he does that anymore. He was the CEO, he's now the CEO. Again, tell us a little bit about the McCann's because this is a family business.
Kirsten Guerra: Yeah. I don't think I've seen those commercials recently, but I have seen some of the old versions from the '90s and around that time. Jim McCann, a well known name and actually when I first mentioned this to Tim Buyers, he recognized him immediately from those commercials. But he founded the company under the name 1-800-Flowers back in 1995. He served as CEO then. He's still CEO today. But as you mentioned, there was there was some change there. Technically, his brother Chris McCann actually took over as CEO in 2016 and ran the company until last year in 2023 when he needed to step away for some personal health reasons. Now it's back with founder and CEO again, Jim McCann. One way or another, this has always been a family business between the two of them they still own 47% of the company. Of course, most of that with Jim McCann, who owns 45% of it nearly 30 years after founding it, which is very impressive that he's managed to hang onto so much of the business.
Deidre Woollard: He's very, very passionate about it. In the earnings, it's definitely clear that he's very identified with it.
Kirsten Guerra: Yeah, absolutely. This is his whole life, and he's done very well with it clearly.
Deidre Woollard: Well, thinking about 1-800-Flowers in the whole business in general, there's been some consumer weakness in recent quarters with the business. Some of that might be reduced corporate giving. This the year of efficiency that has, a lot of companies have cut back on all sorts of things. But when you're looking at this company, how tightly tied do you think it is to the economy, to the ways that we spend, or do we just always have to give something if it's Valentine's Day or if it's Mother's Day. If you don't do it, you're going to be in trouble.
Kirsten Guerra: Yes. That's what I'm told. Flowers are considered an ephemeral gift, that's what they call them. They can't be used, they can't be consumed. That means that they are typically the first gift class that most people cut in tougher economic times. But as we've talked about 1-800-Flowers has diversified into a lot of other gift options. In fact, today, more than half of their revenue actually, comes from gourmet food and gift baskets. Roughly the other half comes from flowers, but still technically not as much from flowers today. That diversification in the steady stream of acquisitions over the years means that revenue at least has historically climbed every year, except through the great financial crisis, despite potential fluctuations in demand. Revenue did finally drop again in 2023, breaking that trend again amid economic pressure. But 1-800-Flowers talks about this. They break their revenue down into what they would call holidays in every day buckets, and they continue to see strong demand in the holidays category. To your question, yes, the gift giving pressure, especially around the holidays, will probably always exist and that adds some real stability to the business. More of the revenue fluctuation comes from the every day category. Which might be, for example, me sending you a thank you stake for having me on the podcast that's not necessarily recurring. But it's a one off I may feel compelled to send. Of course, the nature of that type of gift giving is always harder to predict and disappears quicker under economic pressure. But potentially has more room for upside as well. Because there's just more potential there.
Deidre Woollard: Well, I'm curious a little bit about their membership thing. It sounds almost like a prime for gift givers. Is that the idea is to make a more steady revenue stream by encouraging people to send gifts for any reason at all?
Kirsten Guerra: Yeah, I think that's the goal to add a little bit of recurring revenue, but maybe more so the ecosystem aspect, to have that competitive advantage where if you have, it's a little bit of sunk cost to a consumer. If you've already paid the upfront fee, which, oh, don't quote me offhand, I think it was like $20 or something. But if I've already paid that to get into the system, then the next time I'm thinking of sending flowers or sending a gift basket, I'm going to be compelled to go right back to 1-800-Flowers. Because not only have I bought into that system, I'm going to get free delivery on that next order. Maybe I also have some discount or coupon that they've given to me to come back to them and keep staying with them. I think it's more the ecosystem more than anything. But it seems to be working.
Deidre Woollard: I'm sure they email you frequently [laughs] to remind you to do it.
Kirsten Guerra: Yes, I have had to block them because as you know, I did do an order to just, as I was looking into this as a recommendation, I made an order just to test all of the things I've mentioned, the automation facilities, and see how they worked through all of that and they did well. But yes, there are a lot of emails that come with it around holidays, certainly reminding me to come right back to them.
Deidre Woollard: Well, thinking about this as an investment, this is a company. It's being going through some stuff. You mentioned the investment in automation and in the warehouses there's signs of improvement which is great. Company probably doesn't have to do a lot to impress shareholders at this point because those expectations have been down and it's been trading at some low price to book value and price to sales multiples. You mentioned the quarter revenue was still down. They lowered their revenue guidance down to I think, seven to 9% for the year. What should we be looking at here?
Kirsten Guerra: It's been very cheap recently based on how I valued the business at least. That's one of the benefits to having the outdated name and very few analysts that are following the business. There's not a lot of people looking at this. When there's not a lot of expectation baked in as you said, they don't have to do a lot to impress shareholders. Overall, the main goals of 1-800-Flowers as a company right now and what investors should really be looking for from them is a return to normal more than anything. We want to see the dissipation of economic pressure that's weighed on the top line. Hopefully see more of those everyday purchases come back and we want to see their gross margins return to historical levels for this company, which is around 41%. That fell to 37% recently with rises in freight costs and all the fluctuating commodity costs that we talked about, but they've already built that back to 39%. I actually started first looking at this company last year, when both the company's CFO and its president took money out of their own pockets to buy shares on the open market, where the CFO actually upped his stake by more than 12%.
That's a pretty clear sign that these insiders at least feel confident that their business is being significantly undervalued. Now I will say they bought at an average share price closer to $6 at the time. Right around the time of this recording, I think it's around 10. It's something to be aware of. But I would say that if they can manage to not only return to business as usual, which is the current goal, but also really leverage all of those tech in fulfillment investments to encourage more multi-brand bundles, attract more consistent gift givers into their loyalty program, and push further into corporate gift giving as you mentioned then, potentially it's still quite fairly valued at this point.
Deidre Woollard: As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. I'm Deidre Woollard. Thanks for listening. We'll see you tomorrow.
