A Social Media and Sentiment Analysis of Nike (NKE): What Does It Mean for Future Purchase Intent?

Nike’s recent sponsorship of Colin Kaepernick and his campaign of kneeling during the national anthem has thrust the Nike brand back into the spotlight. The is not an unfamiliar position for Nike, and one that it has successfully occupied in the past.

As a brand that skews young and urban, the calculus is clear: Nike can galvanize support for Kaepernick’s cause and burnish its own brand among these key constituencies, while limiting negative brand impact among older audiences that are less important to its business. In other words, Nike is playing to its key customers.

Nike and Trump

As part of playing to that base, Nike’s calculated decision also suggests that it is comfortable potentially antagonizing a generally polarizing President, as President Trump has been a vocal critic of Kaepernick throughout the kneeling debate.                                     

So far, Trump’s Tweets have driven a fairly tepid 58K retweets between them, compared to 652K retweets for the two major Kaepernick Tweets.

With Nike taking a play from President Trump’s playbook, perhaps President Trump sensed that giving the Tweet more publicity would only fuel the campaign’s reach, and has thus refrained from tweeting about the campaign since September 7th.

For Kaepernick and Nike, this has been a watershed campaign, driving massive Twitter mentions that are far eclipsing previous peaks:

Twitter Mentions: Nike vs. Kaepernick

View Interactive Chart: http://snt.io/oKDKeowwV

Nike is a shrewd marketer and we presume that they extensively focus-grouped the campaign’s impact before going live. However, there is no telling what happens once the campaign is in the wild.

Sentiment Analysis of Nike Tweets

We used Sentieo’s proprietary sentiment analysis engine on Nike Tweets and news to analyze sentiment immediately before and after Kaepernick’s initial Tweets, testing our hypothesis that the campaign would be a net positive for Nike’s brand and advertising reach.

The initial Tweet came out on September 3rd with a simple image and message:

The Tweet was followed by a two minute Nike video ad released on September 5th:

We scored the sentiment of a sample of Tweets in the days since the start of the campaign, and found some interesting results:

Before the initial Tweet, Tweets were scarce and sentiment was fairly broadly distributed. Tweet volume spiked and sentiment turned markedly negative in the hours after the initial Kaepernick Tweet, as a multitude of Twitter accounts called the action unpatriotic and called for boycotts on Nike products.

However, two days later, when the ad was released on Thursday Night Football, we saw the Nike marketing machine kick into high gear. It drove a second spike in tweets and increasingly positive sentiment as the audience digested the powerful ad and its message of excellence, commitment, and sacrifice — classic Nike marketing staples.

Positive and Negative Twitter Hashtags

When we surveyed the most popular daily hashtags within Nike Tweets, we found a similar story. Blue hashtags below indicate positive sentiment (led by #JustDoIt most days), while the red hashtags indicate negative sentiment (#BoycottNike and #MAGA – Make America Great Again).

Red hashtags were popular in the early days of the campaign, but were overwhelmed by the blue hashtags after September 5th.

Positive and Negative Sentiment Hashtags

 

Examining Purchase Intent on Twitter

To gauge the impact on consumer purchasing decisions, we also analyzed trends for purchase intent on Twitter, e.g. “I want a pair of,” “Mom bought me some,” etc.

The chart below shows that Nike had an all-time high of purchase intent tweets after 9/3, and positive purchase intent Tweets have outnumbered negative purchase intent Tweets 5:1.

Nike: Postitive vs. Negative Purchase Intent

View Interactive Chart: http://snt.io/gfDKgjsYZ

When including the much broader boycott campaigns, we see more negative intent. However, we believe that purchase intent — positive or negative — is a much more powerful indicator than someone merely retweeting a boycott hashtag.

Nike Positive vs. Negative Purchase Intent, with “boycott” Twitter mentions

View Interactive Chart: http://snt.io/AhDKgzZQh

Collectively, this signals to us that the campaign is working from a marketing perspective. We also think the ROI on spend from this will be very high, given the increased reach through major digital channels.

Kaepernick’s Tweet from 9/3 was liked 900k times and retweeted 366k times. The video ad on 9/5 was viewed 24.9M times on Twitter and over 15M times on YouTube.

Instagram Influencers

There is also a beneficial secondary effect from other celebrity influencers. For example, Lebron James’ Instagram post has generated 1.4M likes and 16.1K comments.

News Articles

We also analyzed Nike news articles, and now believe that the media will portray Nike in an increasingly positive light, further contributing to the virality of the campaign. Sentiment turned quite negative after the initial tweet, but started a gradual recovery after Nike released the video ad.

While some investors are worried about headline risk with Nike’s campaign, we find that the campaign was well thought out, and is likely to increase its mindshare across its core demographic. Influencers and the news media have expanded the reach of Nike’s campaign, and general consumer purchase intent has increased as a result.

Memphis Research Finds A Financial Research Platform It Can Trust

About The Customer:

Memphis Research in Memphis, TN

Using Sentieo Since 2016

Memphis Research offers investment research, portfolio management, and consulting services for the hedge fund industry. Chad Gilliland (President) and Will Frazier (VP/Director) started the firm together in 2011 after working together at a hedge fund for some time.

 

The Challenge

Before Sentieo, the Memphis Research team had tried many financial research platforms, including Capital IQ and Bloomberg. All had fallen short of their expectations in a number of ways. They had un-intuitive user interfaces, limited mobile access, and were overpriced — to name a few shortcomings.

 

The Solution and Results

The team came across Sentieo and started a free trial. They immediately saw their fundamental research process improve:

“We feel like the Sentieo team understands what we do better than other platforms do. You are analysts and you think the way that we do. You know how to design the interface, and what you put into the product is not just random. You’ve included the pertinent details that an investment analyst wants to see. It makes a huge difference that the platform is truly built for analysts, by analysts.”

 

Document Search, Redlining, Watchlist Alerts, and News Stream

The Memphis team likes to run very specific keyword searches using Sentieo’s Document Search. They are able to narrow their searches down by document type, down to the document section (ie. “Risk Factors”). One popular use case for them is searching for disingenuous language and other signifiers within call transcripts.

The team also uses the Document Search redlining tool, which allows them to hone in on new document language or accounting numbers that have changed across quarters or over years.

Will and Chad also “follow” tickers in Sentieo by creating Watchlists of the companies they want to track. This allows them to receive immediate updates to their email inbox whenever new filings or financial statements come out for those companies. This is especially helpful to them during earnings season, when time is of the essence.

The team also keeps up with companies using the Sentieo News Stream, which is a feed of the latest social media tweets and articles about the companies they track.

 

 

 

An Equity Data Terminal They Can Trust

Will spends most of his time in the Sentieo Equity Data Terminal. He really loves the EDT’s company summary page, which lists a company’s consensus estimates, valuation and price target, major holders, and much more:

“In the EDT, I can quickly understand the nuts and bolts of a company. I have more confidence doing my research in Sentieo because I trust the data more than I trust the numbers in other systems.”

Will also extracts tables from documents into Excel, and compares them over time using Sentieo’s TableX suite of tools.

 

Staying Organized With The Notebook

Chad uses the Notebook (Sentieo’s research management system) to store his own notes and annotations by ticker, and to search through them as needed.

 

Mobile App For Access Anywhere, Anytime

Chad and Will frequently travel to trade shows, and they use the Sentieo mobile and tablet apps to keep working on-the-go. With Sentieo, they are able to quickly pull up financials and estimates at their fingertips, instead of printing and taking physical 10Ks and 10Qs with them. When listening to management calls, they are able to quickly pull up the expectations for a ticker on their mobile, and compare them to what’s being discussed on the spot. Chad also heavily uses the Sentieo app for the iPad tablet.

 

Conclusion

Will and Chad explained that Sentieo has revolutionized their fundamental research flow and saved them all the time and frustration they felt when using previous tools:

“We definitely positively endorse Sentieo. It’s an intuitive platform for built for the fundamental equity analyst, and helps us filter out the noise and get down to the fundamentals.”

The Adidas ($ADS) Brand: Climbing Up or Decelerating?

In this post, we look at Adidas’ growing popularity over the past few years, as well as its more recent deceleration. Sentieo gives us some insights into Adidas’ key strategies.

The Sportswear Boom

The sneakers market — and actually the whole sportswear/athletic footwear sector — has been an interesting space to follow for the past few years. From the rise of yoga-inspired Lululemon (LULU), to the innovative marketing strategies that the triggered growth of German brands Adidas and Puma (PUM), through the volatility of the Nike/Jordan (NKE) brands, and the boom and bust of Under Armour (UAA). With Sentieo, we’ve been able to track and understand the activity of these companies.

In this post, we will focus particularly on Adidas. The Adidas brand has experienced a strong resurgence in the past few years, thanks to the success of its unique sneaker models and powerful endorsement contracts with non-athlete superstars like Kanye West and Pharrell Williams. As a result, this celebrity-infused strategy was also implemented by other sportswear brands like Puma, whose famous personalities include popstar Rihanna.

Besides tracking Adidas’ surge in sales and profits, we also use the alternative datasets in Sentieo’s Mosaic tool. This data gives us a unique view of the underlying trends for a particular company or industry. Alternative data is consistently flowing without delay, while new financial information is usually only available every three months (or every six months in many cases). For example, the chart below shows alternative dataset Google Trends (web search data), highlighting Adidas’ massive growth and subsequent deceleration:

Adidas.com Google Trends:

The black line shows Google Trends’ raw search data for the word “adidas,” while the pink and the yellow lines are the 3-months moving averages of the Y/Y variation of Google Trends data for the United States and the whole world, respectively. The Y/Y variation neutralizes the seasonal effects, while the moving average makes the underlying trend more visible.

In addition to Google Trends, another Mosaic data set that gave us well-timed insights into Adidas’ growing popularity and subsequent deceleration was Alexa website traffic, which helps us track consumer interest. In the chart below, we plotted a 30-day moving average (dashed line) and a 90-day moving average (dashed line) for Adidas.com website views. As we can see, the strong run-up and subsequent deceleration was confirmed by the trends in website traffic as well.

 

Adidas.com Alexa Website Visits:

Sentieo’s alternative data tools allowed us to anticipate Adidas’ deceleration, and will continue to give us an exclusive view into the popularity fluctuations that the brand experiences. As a result of declining customer interest, Adidas’ revenue growth and growth expectations declined to low-to-mid single-digit rates, but the company is implementing other strategies to fuel bottomline growth and reignite sales momentum.

 

A New Strategy: Limiting Supply

Popular Adidas shoe models such as the “Stan Smith” and “Superstar” have been major contributors to Adidas’ massive revival over the past few years, which have been supported by the aforementioned endorsements and innovative marketing campaigns. While other styles such as the Ultra Boost are gaining market share at a massive rate, Adidas is actually limiting the availability of popular shoes (the two flagship sneakers just mentioned), and two models that many consider “evergreens” in Adidas’ portfolio. This kind of move, which has already worked well for Adidas in the past, has the potential to help Adidas’ merchandise margins, which have already been significantly expanding recently. As reported in the past earnings release, Adidas’ gross margin has increased by a few hundred basis points, and the recent moves may indicate an attempt to push margins even further if Adidas’ supply limitation strategy works.

However, the decision to limit supply of some sneakers may also be a proactive move to avoid overexposure and excessive discounting of Adidas’ products. The number of discounts on Adidas products has increased recently, and the decision to limit supply of some key products may be a response to the growing pricing pressures generated by an excessive supply. One Sentieo dataset we can use to track promotional activity around the Adidas brand is Twitter, a social media platform where brands and third-party retailers frequently advertise their special offers. We used a 30-day moving average for the number of mentions of promotional activity around Adidas products, and noticed a significant increase over the past five years, culminating in an all-time high at the end of June.

 

Twitter Mentions – Adidas Discounts

However, the new strategy may not be simply a way to increase margins. This strategy of reducing supply to increase desirability is nothing new in the fashion world and has already been implemented successfully by Adidas in past years. The Adidas Stan Smith shoe, for example, has already experienced two peaks of popularity in the past 12 years – one in 2006 and one in 2016 – as the Google Trends chart below shows:

Management is likely trying to trigger another growth cycle by replicating the same strategy that has already been successful.

Sentieo gives us a timely, in-depth view into several fundamental trends affecting an industry, and a deeper understanding of phenomena that affect a business.

In the case of Adidas, the influential factors include: the current direction of customer interests, the popularity of a brand/product, and the intensity of promotional activity — all giving us important hints about the future direction of the company’s sales and margin trends.

How to Use Web Search Trends In Your Fundamental Research Workflow #2: Using Screener to Find Interesting Trends

Previous post in this series: How to Use Web Search Trends In Your Fundamental Research Workflow: Beat or Miss?

In our last blog post in this series, we talked about predicting a beat or miss with search trends. But there are situations where the data may not work as easily as with that example. So how can you sift through all of the data to find those situations?

Sentieo’s Screener lets you filter from thousands of stocks down to more manageable lists of names to do further work on. The steps below will use the Sentieo Index, a weighted average of alternative datasets that varies by ticker.

First, let’s rank on companies using a Sentieo Index r-squared of over 0.3. This will help find companies whose search trends correlate closely with revenues. We get down to 405 results:

Now perhaps we want to see where these companies are diverging vs. consensus expectations.

Let’s try using our acceleration ranks. This is just a number from 0 to 100, where (>50) means that the data had a positive acceleration, while (<50) means a negative acceleration (or a deceleration). We can simply look for cases where the Sentieo Index is accelerating, with Revenue growth expected to decelerate.

47 stocks is still a lot to go through. You can narrow down further by filter on a sector or even a specific watchlist. We’ve put in our “Cloud” watchlist to cover pure SaaS companies and are getting the following results:

It’s important to sanity-check these numbers by going into the charting interface. If we look closer for $ZEN, we can see that the Sentieo Index suggests an acceleration, while consensus expects a revenue growth deceleration.

View Interactive Chart

Screening is important when harnessing the power of alternative data. It is impossible to manually sift through data trends for each of the thousands of companies that we cover. Screener will help focus your efforts to a manageable list, so that you’re finding the best opportunities and prioritizing your time accordingly.

 

How to Use Web Search Trends In Your Fundamental Research Workflow: Beat or Miss?

Note: The content of this post references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.

Alternative data is a hot topic these days. From buzz around satellite imagery data to social chatter, there is a deluge of data out there. How can you make use of it, though?

Let’s walk through an example with Sodastream ($SODA). We used Sentieo to plot global web search trends for the “sodastream” keyword (dark blue) against the $SODA stock price (light blue).

View Interactive Chart

The correlation is great, but we don’t suggest that you buy a stock just because alternative data is going up. You should instead use this data as another pillar of a comprehensive investment process. Ask yourself: how does alternative data tie back to the fundamentals of a business?

As consumers, we tend to search for products online before purchasing. In most cases, searching Sodastream signifies interest in the brand or an intent to purchase – let’s call this “digital traffic.” Some percentage of that “traffic” will convert to true revenue as the consumer makes an purchase online or in-store at a later point.

So while search trends will most closely tie to digital traffic, we hope it can be a meaningful indicator for overall Revenue (or other top-line key performance indicators). As we can see from the chart below, that seemed to be the case here. Search trends had a 0.9 r-squared with $SODA’s revenue growth.

View Interactive Chart

This example is just one way that search trends can help you in your fundamental research. Stay tuned for the upcoming posts in this blog series on alternative data search trends.

Apple Hits $1 Trillion To Become First Trillion Dollar Company; But It’s Still Not The Most Valuable Company In The World

Today, Apple (AAPL) became the first $1 trillion public U.S. company. Its stock jumped 2.8 percent to $207.05 (as of 9:15 a.m. Pacific), taking its gain to 9 percent since this Tuesday, when it released its latest quarterly earnings. Apple management reported higher than expected quarterly results, and mentioned that it bought back $20 billion of its own shares.

But in spite of all of the press coverage around this major milestone, Apple is not even the most valuable company in the world. That distinction belongs to fellow tech giant Amazon. How can that be, when Amazon’s market capitalization is only a ‘meager’ 887 billion? The key lies in the metric used to measure a company’s value.

Most analysts use “Enterprise Value” rather than market capitalization to measure a company’s value because it accounts for the total operating value of the firm and adjusts for the capital structure of the firm (with equity, debt, and cash). A large part of Apple’s equity value is in the hoard of cash on its balance sheet, which doesn’t reflect the ongoing value of the company. They could use that cash to issue a dividend or buyback shares, but it wouldn’t change how much the actual company is worth based on its potential future profits. In fact, Apple typically buys back shares every quarter.

Amazon passed Apple in enterprise value back in June during its meteoric rise and is now worth $80B more than Apple. Amazon and Apple are just two of the tech giants (dare we say “conglomerates”) that now make up the most valuable companies in the world. We took a closer look at the rest of the tech giants and plotted their enterprise values over time using Sentieo’s Plotter tool.

 

Tech Giants Enterprise Value

Sentieo

Interactive Chart: http://snt.io/c8B2JRXn2

Looking at the chart, we can see that Apple (black line) and Google (red line) had been leading the pack since 2016. However, around February of this year, Amazon surpassed them both to become the most valuable, and after some back and forth, broke away at the beginning of June.

Facebook (blue line) and Netflix (purple line), while also members of the “FANG” group, actually have much lower enterprise value that Amazon and Apple.

 

Regardless of Enterprise Value or Market Cap, Tech Is Taking Over

The more important thing to note is that these tech giants are taking the stage as the world’s most valuable companies, both in enterprise value and market cap. In July, CNBC reported that the majority of the returns this year on the S&P 500 index have from tech giants. The tech companies in the table below are responsible for 99 percent of the S&P 500 returns this year, meaning the rest of the S&P remained almost flat. (Data as of July 10, 2018)

This hasn’t been the case since the last dot-com boom in the 1990s, when Cisco was anticipated to become the first trillion dollar company. We plotted a few tech and oil companies to look at how market leadership has changed over the past 10 years.

The large grey spike in 2008 represents PetroChina’s peak market cap.

In 2006, Microsoft (blue line) had the fourth largest market cap but was still eclipsed by Exxon (orange), GE (black), and PetroChina (gray) — and closely followed by Total (teal).

In 2011, Apple (red) came in third place to Exxon and PetroChina.

But in 2016, Apple (red), and Microsoft (blue), Amazon (purple) and Facebook (green) all took the top 4 highest market cap spots, dissimilar to the situation today.

 

Market Cap: Tech vs. Oil 

Interactive Chart: http://snt.io/aHB2JPRNV

Based on their monstrous market share, we anticipate that the tech giants will rule for a while — unless another unexpected dot-com crash occurs.

Pass Me A LaCroix: How Specialty Sodas Are Disrupting the Beverage Industry

In our “Trending Foods” series of blog posts, we analyzed interesting trends in the food industry, such as the increasing popularity of protein-rich grains, the avocado craze, and the changing customer habits that are fueling new consumption patterns, such as the brunch and street food phenomenon.

In this post, we are going to analyze a few interesting trends in the beverage industry, which is another segment of the consumer space that is experiencing significant changes due to increasing health consciousness, changing consumption habits, and ethics-driven diets.

 

Craft Sodas Taking An Increasing Market Share

The first trend we analyzed is the growing popularity of craft sodas, which has created challenges for traditional beverage mass-producers. Like other trends in the food/drinks industry, the growth of craft sodas has been fueled by the increased health-consciousness of consumers, the desire for premium/quality products, and the preference for specific ingredients due to ethical reasons. From the increased use of “organic” and “local” ingredients, to the higher adoption of brown sugar at the expense of the more popular refined alternative, we have seen interesting trends shaping customer habits and opening new market opportunities.

At the same time, traditional sodas are under scrutiny and doubted by consumers due to their high sugar content and obscure ingredients lists, in a moment when consumer appetite for non-alcoholic consumption has risen significantly by people making healthier lifestyle choices.

We can use Sentieo to analyze the demand for craft soda. We’ll take a quick but in-depth look at which companies are exposed to the new trend and how they are trying to benefit from it. Sentieo’s Document Search allows us to quickly identify the companies that are very active in this segment, such as Reed’s Inc., which, according to its company presentations, aims to become “the Sam Adams of Craft Carbonated Soft Drinks.”

However, the growing popularity of these drinks is also creating an opportunity for smaller operators and for restaurant chains that offer their own crafted sodas — like BJ’s Restaurants (BJRI) and Bagger Dave (BDVB). This trend is a potential threat for mass producers and a great opportunity for smaller players and the restaurant industry. They can offer their own premium drinks and generate higher margins thanks to a direct relationship with customers.

Sentieo allows us to search company documents, but it can also show us customer interest trends. We can use Sentieo’s alternative data tool Mosaic to plot Google Trends data and track consumer interests. In this case, we plotted Google Trends data for the term “craft soda.” To make the trend more visible, we applied a 12-week moving average to Google Trends’ raw data below:

As we can see, craft soda’s popularity boomed between 2011 and 2016, but remained basically flat for the past two years. Companies’ activity in this field has basically followed the trend in consumer interest highlighted by Google Trends, with a solid growth between 2011 and 2016 and a more flat trend in the past two years. This is clear when we analyze the number of mentions of the term “craft soda” in company-related documents and transcripts using Sentieo’s Document Search tool:

Given the aforementioned adoption of healthier lifestyles, another acceleration of this positive trend is possible in the future, and Sentieo can help you keep monitoring these trends.

 

Flavored Water Quenches Consumer Thirst

A second trend worth analyzing is the increasing popularity of flavored water, which is considered as a healthier alternative to soda drinks thanks to the absence of artificial sweeteners, caffeine, and flavor enhancers. While the debate is open and everything obviously depends on how the flavored water is actually prepared (e.g. with or without sweeteners or nutritional enhancements), the evidence is that the changing consumer preferences are boosting this segment of the beverage industry.

The growing popularity of flavored water is truly a strong and current trend. We looked at Google Trends data in Mosaic and noticed a massive growth in the number of searches for “flavored water” on the search engine. As in the case of flavored water, we used a 12-week moving average of the Google Trends data to make the trend more visible. This is the result:

We can easily see how the searches for flavored water have been growing constantly since 2009, and actually skyrocketed in the first half of 2018. Companies have been increasingly active in this area as well, as the growing number of mentions of “flavored water” in company-related documents and transcripts shows:

The companies that have invested in this segment of the beverage industry include Del Monte Pacific Limited, Sodastream International, True Drinks Holdings, Keurig Dr. Pepper, and National Beverage Corp (FIZZ), which produces the soda that has become a national phenomenon: LaCroix sparkling water.

We found a recent press release from FIZZ within Sentieo which details the success of LaCroix:

Traditional Drinks Producers Face Mounting Competitive Pressure

The popularity of alternative drinks like craft sodas and flavored water threaten traditional beverage companies such as Coca Cola (KO) and Pepsi (PEP), especially if consumers find alternative sources for these drinks, as we have seen with craft sodas and the growing tendency of restaurant operators to produce their own drinks.

Sentieo helps us identify, analyze and compare industry trends quickly and effectively, in the beverage industry as well as in many other sectors. We used powerful and flexible Document Search, and alternative data from Mosaic to analyze some important underlying trends in the beverage industry. Sentieo can be used to run ad-hoc searches on a virtually unlimited number of topics, allowing us to gain important insights into any industry that are not available anywhere else. 

What’s For Brunch? Trending Foods with Growth Potential: Part 2

Last week, we took a close look at the food industry, which certainly follows trends and changing consumption habits that can ultimately greatly affect the performance of various companies. Using Sentieo, we were able to take a look at data and trends regarding protein-rich grains like quinoa, hemp, and sorghum. This week, we’ll examine how the hype around brunch and street foods have been discussed across company filings.

 

The Avocado Craze and Brunch Boom

Avocados have been available to consumers for a while, but they were not very popular outside of Mexican cuisine until a few years ago. Since 2010, the popularity of this fruit has boomed, and consumer interest has spiked due to people’s greater awareness of healthy eating habits. The benefits of the avocado are many: the fruit has more potassium than bananas and is full of antioxidants, to name a few.

Google Trends data from Sentieo shows the booming popularity of the avocado quite clearly. The volume of searches has risen by over 400% since 2004 – 2008:

 

Many companies are not waiting on the sidelines. They are well aware of the recent trends, and the number of times that the word “avocado” has been mentioned in company filings proves it. (See below).

There are numerous companies exposed to the growing popularity of the avocado. Del Monte produces and markets several avocado products, while Limoneira claims to be one of the leading producers of avocado in the Americas. In the restaurant segments, more and more companies use it as an ingredient in their recipes. Del Taco Restaurants even mentions avocado in the company’s About section on every press release:

Consumers’ changing tastes are not just reflected in the growing or falling popularity of specific foods, but also in changing consumption habits when it comes to where to eat and when to eat. The way people eat and relax across the world is evolving, and the growing popularity of brunch is a clear example of that.

Document hits confirm that the brunch boom is a trend that many companies have been riding for several years now:

Based on the number of times that the word “brunch” has been mentioned in filings and transcripts, the most active companies in the brunch space seem to be Brazilian steakhouse chain Fogo de Chao, The Cheesecake Factory, and Brinker International. Even hospitality chain Marriott International has tried to take advantage of the new trend by offering several brunch options to its customers.

Speaking of how and where, we can’t avoid mentioning the constant growth of street food concepts. Street food’s growth is rampant. Even Michelin has recognized street food in its Hong Kong guide, and even two Singapore street-food hawkers have each received one Michelin star. The street food concept is loved by companies that want low-risk ways to test a new restaurant concept or food offering before committing to larger investments.

Look at how the number of mentions of “street food” in company-related documents and transcripts has boomed since 2013:

It is also a reflection of the growing interest from customers:

Street food combines the pleasure of eating tasty food with an important experience component, and it’s highly shareable, as the growing number of Twitter mentions indicates:

 

Sentieo’s tools help us identify, analyze and compare industry trends quickly and effectively. We used Document Search and alternative data from Mosaic to analyze these interesting trends in the food industry, a segment of the consumer space that is experiencing significant changes due to increasing health consciousness, changing consumption habits, and the rising adoption of specific diets for ethical reasons.

However, Sentieo’s tools can be used to run ad-hoc searches on a virtually unlimited number of topics, allowing us to gain important insights into any industry that are not available anywhere else. Stay tuned for the upcoming Part 3 of our Trending Foods Series!

What’s For Lunch? Trending Foods with Growth Potential: Part 1

Like other segments of the consumer sector, the food industry follows trends and changing consumption habits that can benefit one company over another. Particularly in the recent years, we have seen changing attitudes towards health, community and the environment, which have affected consumption habits and translated into the growing popularity of specific foods and drinks.

Foods without artificial additive products, colors, flavors, sweeteners, and hydrogenated fats have become increasingly popular, and the acquisition of Whole Foods by a high-tech growth giant like Amazon is indicative of the growth potential seen in this market. In this post, we use Sentieo’s tools to look at a few interesting trends in the food industry.

 

Protein-Rich Grains Gain Popularity

With the World Health Organization warning about the potential danger of eating too much meat, the vegetable sources of proteins have become increasingly popular, and not only among fitness and body-building enthusiasts. They are also popular among vegetarians and, above all, vegans, who need non-animal sources of proteins. Protein-Rich seeds and grains have become increasingly popular as standalone foods and as add-ons to yogurt, oatmeal, and peanut butter. Let’s take a look at a few of them a bit more in detail.

2013 was named the official year of quinoa, but it seems that the grain has become even more popular since then. We used Sentieo’s Mosaic tool, which offers users the ability to find and visualize alternative datasets. The number of mentions of quinoa in company filings and transcripts has basically tripled since 2013:

Sentieo

 

Consumer interest in quinoa, which we measured using Google Trends data, has also increased substantially since then, but was basically flat during the past three years as other vegetable sources of proteins started to gain market share. In the chart below, you can see Google Trends data for the word “quinoa” (blue line). We have also added a 13-week moving average of the Y/Y variation of Google Trends data (yellow line), which makes the underlying trend more visible and neutralizes seasonal effects:

The increasing popularity of hemp is even more evident. Like quinoa, hemp is a protein-rich plant and is considered a complete protein source, which means it provides all the essential amino acids (an extremely rare characteristic for vegetables). Hemp’s popularity has skyrocketed in the past few years, as the growing number of mentions in company documents and transcripts shows:

Also, consumers’ interest in hemp — and hemp seeds in particular — has skyrocketed:

Another protein-rich grain that is becoming increasingly popular is sorghum. Although it’s not a complete source of amino acids, there are many interesting ways it can be used. It is a good sweetener and can be used as a substitute for wheat flour. However, it has no gluten, so it requires a binding agent in some recipes, such as a xanthan gum or cornstarch. It can also be popped like popcorn. Sorghum’s popularity has grown consistently since 2010-2011:

This is confirmed by the growing interest from consumers:

Sentieo’s tools help us identify, analyze and compare industry trends quickly and effectively. We used Document Search and alternative data from Mosaic to analyze a few interesting trends in the food industry, a segment of the consumer space that is experiencing significant changes due to increasing health consciousness, changing consumption habits, and the rising adoption of specific diets for ethical reasons.

We can easily see what’s driving customers’ interest, such as the increasing popularity of protein-rich grains, and how the companies are responding to them. We have also detected which companies can benefit from these trends very easily by monitoring how many times certain keywords have been mentioned in a company’s documents. However, Sentieo’s tools can be used to run ad-hoc searches on a virtually unlimited number of topics, allowing us to gain important insights into any industry that are not available anywhere else. Next week, we’ll feature more trending foods.

From Crypto to Interest Rates: A Sentiment Analysis of Q1 2018 Earnings Calls

Today we published our quarterly Sentiment Analysis Report, which summarizes last quarter’s top keyword searches and provides detailed sentiment analysis across all industries. We used Sentieo’s Transcript Sentiment Analysis feature to analyze earnings call transcripts and discover which topics companies discussed the most last quarter, versus the same quarter in 2017.

We also compared the sentiment of management and analyst sections of transcripts, and graphed these data points so you can easily see trends or discrepancies between the two. We publish these reports every quarter, so you can stay updated on information that could impact your investment decisions this year. Here are some interesting themes that came up in our research:

 

Sentiment Analysis

Management versus investor sentiment is diverging.

Our sentiment analysis on transcripts shows that a decoupling is taking hold between the language from company management and market participants. Management continues to be upbeat during earning calls and presentations, while sell-side analysts and investors are taking a more cautious stance. To learn more, download the full, free report.

 

Keyword Mentions

Two themes we look at closely in this report are Cryptocurrency and Trade Tariffs. When analyzing the number of mentions of crypto by company, the companies that are leading the conversation are currently Nvidia (crypto chip vendor), Visa (payment company), CBOE (professional crypto derivatives exchange), and Salesforce (CRM and enterprise SaaS vendor). 

Talks of trade wars have unsurprisingly become central to many companies, with a marked edge towards uncertainty, caution and even fear for the effect it will have on business. Read more on page 4 of the report.

With these quarterly reports, we are starting down the path of quantifying linguistic data. This report is a real use case of the exciting new features we recently released, like our Transcript Sentiment Report function, which is part of Sentieo Document Search.

Below is a sneak peek of the report: a sample page about cryptocurrency.

To learn more about the companies, industries, and regions where crypto and other themes are being most discussed, download the full report, which covers this sector and many more. To find out more about how to run your own sentiment analysis with Sentieo, sign up here for a free trial.