Blue Apron Handed COVID-19 Reprieve in Fight for Survival

03/08/2020

In a last ditch attempt to maintain independence and a public listing, Blue Apron is developing a strategy to attract and retain customers energized by COVID-19 home confinement.  The company strategy is to provide more choice and flexibility.  Partnerships have been developed with Weight Watchers and The American Diabetes Association in order to extend demand. The Meal Prep option offered by Blue Apron has been introduced to allow consumers to prepare meals in advance with alternatives for dietary faddists including pescatarian, carb-conscious and other permutations.

 

The problem with Blue Apron initiatives is that the company with limited resources and mounting losses is attempting to be all things to all customers.  This is evident in the statement by CEO Linda Kozlowski who opined "while implementing expanded choice and additional flexibility in our products we were able to maintain our high animal welfare and responsible sourcing standards in our proteins, high quality product and dairy."


Linda Kozlowski CEO

Blue Apron

Recently Blue Apron has consolidated production locations and laid-off workers.  The hyenas are however circling and there is speculation that the company will be acquired and operated as a  private holding of an investment group. This would not have been a difficult scenario with a share price of $2.94 on Monday 16th March. Since this time APRON has been reprieved by the COVIND crises with a resultant demand for home delivery. Stock price surged threefold from a close of $3.44 on Tuesday to $14.30 at the close on Thursday March 19th. Market capitalization has advanced to $190 million but the 50-day moving average is $3.75. and 40 percent of the float is short. APRN has traded over the past 52 weeks in a range of $2.01 to $28.84.

 

Sales value declined 33 percent over the past year due to competition and customer disaffection. The Company posted a twelve-month trailing operating margin of -11 percent and a profit margin of -13 percent.

 

It remains to be seen whether the Company can capitalize on newfound demand. Based on a track record of losses, extreme competition and an anticipation of resolution of the COVIN-19 related reluctance to patronize supermarkets, APRN is expected to revert to form by midyear.






































































































































































































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