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Well folks who would have ever thought it tattooed chef ttcf stock would be the one to save my butt okay who would have ever thought this we’re gonna go through all the numbers in regards to chef i took notes as they were doing their conference call i’m going to share those notes with you in this video as well we’re going to talk about the stock price we’re going
To talk about even the short term or the stock price where i think the stock price is going short term okay obviously it’s a long-term investment for me it’s a stock i’ve been buying heavily for the past um you know probably a year but specifically the most heavy probably in the last six to nine months and this is obviously a company i believe in a lot over time
And it was a huge sigh of relief to see them come through and crush the revenue expectations that were essentially uh you know they had revenue expectations out there and they crushed it they absolutely crushed it so that was big because i can tell you in this market right now so many companies have been missing revenue or barely coming in line so to see a company
Like the chef come in and just crush it was yes like that that’s huge from okay i will say that as huge for confidence that’s huge for everything so a lot to get into this video guys hope you enjoyed as always if you want to check out ftx us and sign up for ftx us check out the first link in the description down there fees that are up to 85 lower than competitors
Also get up to 100 in free crypto when you place your first trades through the app and also use referral code holy smokers on there already so in regards to the chef so let’s imagine for us a moment here we’re a business right and let’s say we have this business that’s doing 60 million dollars in revenue and over the next five to six years we’re going to grow into
A business that’s going to do 600 millions of dollars right well the first thing i would think is okay we need to start getting this business so we can scale to 600 million right if you know anything about business you know you got to get your business to a place where you can scale right so you’re gonna need to add a lot of employees you’re going to need to add
A lot of executives right because 60 mil to 600 mil is a pretty big number you’re going to need to add warehouses you’re going to need to add production facilities all those sorts of things right because you’re are scaling your business and you’re getting out ahead of that right now in the short term it hurts margins it hurts profitability it hurts pretty much
Everything especially when you’re in a high inflation environment right but the thing you got to understand is like as your revenue grows and grows closer to 600 your business gets exponentially more profitable as you scale revenue right you have to scale employees warehouses production all that stuff prior to that period right otherwise you’re never going to be
Able to scale to 600 mil that’s not the way it works you have to get out in front of that so it hurts your profitability short term it hurts everything short-term as far as your bottom line numbers but long term obviously as your business gets closer and closer that much bigger number the the the how much revenue makes it down to the bottom line is a huge amount
More than than previously it was okay so that’s very very important i just wanted to because that’s essentially the chef if you’re wondering what’s this example of it’s a chef the chef a couple years ago is doing 60 million dollars in revenue and uh here within the next two to three years they’re expected to do 600 million dollars plus and they’ve had added a lot
Of employees executives warehouses production all those sorts of things to get themselves in that place it hurts profitably in the short term but dude when you got this sort of opportunity you’re going after that opportunity you’ve got to get out in front of that okay now in regards to the numbers here the revenue grew 37 okay now here’s why this is so massive the
Revenue growth expectation was 22 okay so to beat by 15 percentage points is insane like you know i i thought they would be okay but i did not think they would beat that much this blew away my numbers and i’m somebody that’s an ultra bull on the shelf okay so when a company comes in and crushes my personal expectations for that company it’s a huge moment okay when
You can crush a bull like myself’s expectations that’s a huge huge moment and so when i saw that i was like oh my gosh and let’s be quite honest in the short term that’s the only thing that matters for the chef right now in the short term is revenue right the rest of it who’s going don’t matter a lot more down the road but for this year it’s all about getting the
Brand more known getting those revenues up expanding into all the retailers things like that in 23 and after margins become much more important the net income becomes much more important but this year it’s all about revenue so the fact that they come in and just crush it was massive okay tattoo chef branded product revenue uh increased to 21.2 percent or increased
21.2 percent 60 of total revenue adjusted ebitda came in at 13.4 million negative net loss was 17.6 million brain excuse rose to 90 from 78 so the companies kept keeping the pedal to the metal they added more than 10 000 new points of distribution they commenced production of frozen ready-to-eat mexican foods now the important thing to remember when we’re talking
About the the you know tdcf getting into new stores and new points of distribution is a lot of times when they first get a new store or something like that um they might only come in with two or three items but what we’re finding is over time that two to three items rose to 46 i items from six to six to eight items to ten items to 12 items to 15 items so on and so
Forth and the company just keeps growing growing growing so that becomes just absolutely massive right and so that’s very very important to remember there like for instance target’s a great example of this target started with like two items for the chef and now you go into a target store and i mean oh my gosh that’s probably 20 plus skus in some of these target stores
Now and that’s all in a matter of like a year year and a half it’s been extraordinary what they they’ve pulled off there okay enterprise wide automation initiative underway and expected to be completed by the end of 22. now with something like that why this is big is not just so you can get more items out there but the main reason that’s big is that’s going to help
With the cost of the business that will end up helping margins that will help profitability to all folks that obviously long term we’re going to care about margins we’re going to care about profitability and to get out in front of that with automations are going to be big for this company okay branded oat butter bar is set to commence production in q2 of 2022 it’s
A huge product for this company long term and could be a great margin generator cold storage facility operational in april 2022 which should definitely be one of those things that help once again profitability long term so the company now they’ve added all these employees they’ve added production they’re adding revenue they’re adding stores all those things like
That it seems to me based upon the conference call and what they’re talking about here is they’re going to focus much more on profitability over these next few quarters and obviously next few years which is obviously something uh you know that’s good that’s great for the long-term business because we’re in this because we believe it’s going to become a profit beast
Down the road right not because we think they’re going to lose money forever something like that right after a record 2021 our growth continued during 2022 first quarter and we reported our highest ever quarterly revenue of 72 million dollars that was their highest ever okay said sam galetti president ceo of the company we’re continuing to scale our business and
During the first quarter we saw increased contributions from the facilities acquired as part of the new mexico foods distribution deal in the carson tortilla factory mr galletti continued we are or we are advancing initiatives designed to leverage our increase manufacturing capacity and demand profile to drive efficiencies reduce costs expand margins and enhance
Our competitive profile these include increasing our retail footprint and product count in existing retailers that’s big that’s called sku expansion expanding our presence outside of the freeze aisle that is big okay freezer isles one of the worst uh kind of product categories for profitability and as you can get into you know just regular store shelves that that’s
That’s profit machine the margins on those businesses are insane okay to include refrigerated and ambient products so think of this as not refrigerated or freezer okay and integrating automation across our operations we commenced operations at our dedicated cold storage facility in april 2022 and expect to generate significant savings this year by bringing this
Capability in-house i am extremely proud of our team and they continue to deliver growth and maintain the highest levels of quality in client service while navigating macroeconomic challenges which obviously we know there’s an immense amount of those going on right now okay so yeah nonetheless as far as the financial outlook they they reiterate their guidance which
Is huge because a lot of companies aren’t even trying to give guidance right now or they’re giving bad guidance so the fact that the company is like no we’re we’re going to do the numbers we said we’re going to do that is huge for this company okay gross margins obviously expect it to be not in a great place this year as we have all expected the margin has not
Been a great place this particular year marketing expenses expected of 27 to 32 million dollars capital expenditures of approximately 20 million dollars with investments focused on automation robotics and manufacturing facilities all right now in regards to the uh the cash 57 mil accounts receivable we’ll talk about that in just a moment in inventory pretty in line
Okay now on the notes from the conference call here here’s some note i took right the products are now available in 16 000 stores fastest health and wellness growing brand in categories that they compete in based upon this company named spins that does this velocity is insane pay spawn spends like you listen at conference call and it’s it’s hard not to be bullish
And this is stuff from folks like myself that walk the stores all the time we see this all the time we see the velocities moving like these products are moving it’s not like they’re just sitting on short shelves and and you know sometimes you know short sellers don’t ever want to acknowledge uh you know like like how strong this brand is already building out and
How big their long-term opportunity is but i think it’s very very important that everybody that’s watching this video understands that stores like target and kroger and the best of the best retailers in the world these companies do not just keep taking on product unless you are moving and you have that big velocity and the chef has that big velocity and that’s
Why a store like target goes from two skus to force use to six cues to 10 to 15 to 20. that’s why this happens because you’re moving product and if you’re moving product at the end of the day the retailer is going to take more and more your product in these stores okay sam says that they are taking market share right now the company now is 315 000 square feet
Of manufacturing space the company is supposed to do 600 ml of revenue within two to three years sam said on an annual basis that’s huge right companies very uh focused on cost savings moving forward key new executive helping with that says sam oak butter bar is coming in second half of 22 in terms of a meaningful way we could see some of those on on store shelves
Before the second half of 22 but in terms of meaningful um you know back half sarah says a pizza business is very very strong and they’re expanding products they’re they’re expanding big into the mexican cuisine consistent with what we see in stores um you know with the burrito products and all sorts of things basically household awareness has gone from about 11
To about 17 in the u.s quarter over quarter sarah said there based upon their data uh then stephanie’s line got messed up and i said a short sellers cut off stephanie’s line bricks and uh you know they fight dark fight dirty and whatnot and then uh she got back on i had a letter use one of my my backup phones and so i i won’t let the shorts win oh boy uh so company
Has 57 million dollars of cash at the end of the quarter in less than one million dollars in debt so they’re in a very very strong financial position there uh we’re talking about kind of like uh freight costs and those sorts of things um calming down and basically sometimes those can lag a quarter or two uh if you’re in contracts and things like that already so
Sometimes that lags a bit there um pick up and gross margin expected in 3q according to stephanie she said that so that’s going to be phenomenal see that’s another big thing for the stock uh if you’re talking about the stock price in the short term obviously over the long term what drives companies over the long term revenue growth margin growth net income growth
Those are what drives companies over the long term right short term a lot of different things can drive companies so the fact that the margins are expected to start expanding starting in 3q huge for this business model absolutely massive and for the stock price as well it’s absolutely massive people want to see those margins getting better and better and better
They don’t want to just see revenue growth a lot of folks want to see margins as well especially for folks that are maybe on the sideline when it comes to this company want to see those margins go up over time right uh the company talked about bars and chips q3 q4 and more of a meaningful way there sam said they’re going to be profitable by the end of next year
He said that on the conference call i was obviously very very happy to hear that um that’s huge you know to be profitable by then next year now stephanie’s also said you know she’s expecting the same as she said that in past conference calls in 3q 4q somewhere around there roughly right um my personal opinion i said this is a best conference call i’ve been on
For the chef lots of good news for the back half of this year plus management seems uh much more sure what they’re saying in the past right and on top of that you come in with a huge revenue beat for this past quarter a lot of positive vibes starting to build around the chef okay absolutely absolutely huge huge things there okay um i said this is the first time i
Have no fear about the short-term and long term for the chef long term i have always been confident short term is shaky here and there even um you know short-term excuse me even short term should get better and better as the year goes along which is what management’s saying there so i would as a shareholder i’m very very pleased between the massive beat on revenue
Between uh seeing all the cost initiative stuff that they have going on that’s going to help this company in the back half of this year and in future years seeing how they’ve skilled up the the business to get them in this place where they’re going to be able to do many hundreds of millions of dollars in revenue year and year out right and then that conference call
And just listening them be much more confident than i’ve ever seen the chef team in the past um yeah i’m i’m a happy shareholder let’s just put it that way very very happy shareholder okay uh i did post this as well i said accounts receivables up 21 million dollars quarter over quarter i said that costco sam’s club target better not go bankrupt or we’re screwed
Pay the chef okay yeah i mean that’s a pretty steep up uprise there in uh accounts receivable from from 25 mil to 46 mil yeah there’s definitely a lot of money uh the the folks owe this chef okay now in regards the stock price so in regards to after hours you know that’s just you know who’s who’s even in the chef okay this is a stock just driven by retail and
Short sellers okay retail and short sellers short sellers can screw around after hours um you know short term i’m even very very confident in the chef where the stock price is going i’m going to be a buyer of this talk um i’m i’m saying the most optimistic i’ve been in the chef in a long time between not just the valuation being down but but also with that massive
Revenue b with the back half of this year being a better better story not just from revenue side but from a margin side profitability standpoint uh balance sheets in a really really good position all those sorts of things make me feel extremely confident in this one short term uh is going to be what what short term is going to be you know that’s you know the market
All those sorts of things i’m not actually that worried about this and the reason i’m not worried about this is i think there’s going to be a lot of folks that come back to the chef stock that maybe had sold out of this previously and are looking at it now and looking at that insane revenue beat like that’s that’s one of the strongest revenue beats i’ve seen this
Entire earnings season if not the strongest like that was incredible like on a percentage basis that’s ridiculous to come in with that sort of beat so they come in with that sort of beat right the company as far as the margin story is just going to get better and better as your year goes on but not just that year after year i expect the chef to get in better
And better margins so their margins in 22 by the end of this year will be much better than 21 and then 23 is going to be much better than 22. and 24 you know and so on and so forth so when i look at this sort of company in in the food space and just growing into a category that’s just going to get bigger and bigger over the coming years i’m very very optimistic
About the short term and the long term with the chef and that’s in regards to the business model and the stock price and i would not be surprised at all if they there’s a lot of buying pressure that comes in the chef tomorrow like i said i’m a happy buyer of the chef but i think there’s a lot of folks that are going to be looking at this one with a new level of
Respect right um you know obviously they came in they reported on time all those sorts of things they got their numbers together i think that’s big and uh yeah you know for a while there they kept missing you know and when you’re in your first year or two of being a public company it’s tough right and they kept coming in with these messes misses so to come in with
An exceptional beat like that on revenue is uh i’m telling you it it’s beyond massive and so um long term i love this stock short term i love this stock and uh you know i’m just gonna continue to load up on shares and add ownership of this company it’s one of a few companies that are smaller companies that i love i i love the value that amazon is right now i love
The value paypal is right now even netflix i love the value that is shopify is coming so down so much i’m starting to really like that one’s uh you know valuation but of the smaller companies i love honest tattoo chef oatley those are three stocks that come to mind that i love that are smaller cap companies that i think just have sick upside over the next three
To five years and um we’ll end up they’ll write their own history at the end of the day when it comes to those companies and the chef um you know i don’t want to say the chefs more the chef’s definitely more exciting than honest right but i want to say the chef’s necessarily more exciting than oatley i think both those stocks are almost equal as far as the the um
You know uh i say the excitement because both those are just growing like a weed and uh they have just insane opportunities so happy shareholder i’ll be a happy buyer and i’m very confident in the short term in the long term in regards to everything with the chef so anyways guys hope you enjoyed this as always much love and uh don’t forget to check out ftxus the
Official crypto exchange of the financial education channel and me i get up to 100 in free crypto when use place of trades through ftx through my link and use a holy smokers as your referral code first link in the description have a great day
Transcribed from video
Ttcf Just Saved My… You Know What By Financial Education
