What weird and wonderful times we live in.
Wonderful, because we have the world at our fingertips – almost anything we could ever want – is just a few keystrokes away…
Weird, because nothing seems to have an order anymore.
It’s like the world is operating under barely controlled chaos – and only seems to get more chaotic by the day.
Look at our markets…
They’re in as much disarray as we’ve ever seen. Our politics… our news outlets… it’s all up in the air – and you’ve seen its effects everywhere.
Prices are soaring… values are dropping… and nobody has an answer.
Many companies are struggling to stay in business…
Except for an elite class that seems to be KILLING it – one of which made killing recently due to its debut on the world markets.
Prompting the question: Is the future just about luxury brands?
Look…
Regardless of who you are or how much money you make – we ALL can appreciate the finer things in life.
We may not all be able to afford those nice things…
But the truth is – if given access – most of us like nice things.
So is it any surprise to learn that while the world economy seems to be sinking lower and lower into the sewer – the cream is rising to the top – as luxury brands are really the only ones making money?
We saw evidence of this recently when one of those brands made an immediate impact.
Last week, Porsche, the luxury sports car brand, made its hotly anticipated trading debut on the Frankfort Exchange.
With stocks seeming to be in a never-ending slump – and initial public offerings (IPOs) almost non-existent on any exchange – you’d think that NOW would be a terrible time for a company to debut…
But Porsche would prove that thinking wrong.
Luxury brands seem impervious to economic woes that are affecting the rest of the world…
And Porsche just proved that to the world.
When Volkswagen listed a 12.5% stake in the sports car company – investors didn’t hold back…
Demand was so strong that shares hit the top of the initial pricing range – helping the company raise over $9 billion and valuing Porsche at around $73 billion.
That marks the single biggest IPO in Europe in a decade…
Which is good news for Volkswagen – but is it good news for the markets or any other company looking to debut?
Probably not…
And even though it was a huge debut – people are already starting to downplay the success.
Even though Porsche’s shares rose by 3% when trading started…
There are some analysts that were disappointed the price didn’t rise more.
With some even saying that the debut wasn’t anything earthshattering…
As the IPO success only LOOKS good when compared to everything else going on around it in the markets.
Are they right?
Who knows…
But what I do know is that Porsche’s valuation now is almost as much as its parent company, Volkswagen – only missing it by $2 billion.
And seeing that this was ALL done to give the entire scope of the VW owned-brands a leg up when it comes to making a push into the electric car market…
Then, to put a little icing on the cake, Porsche’s healthier profit margins and brand loyalty puts it in a very solid position – and we could soon see OTHER luxury brands following suit.
We could see an IPO renaissance if other luxury brands decide to follow in Porsche’s footsteps…
Though, it may just widen the divide between the economic classes – adding even more chaos to the mix.
We’ll have to wait and see…
In the meantime – other luxury brands such as Ferrari (RACE) and Tapestry (TPR) are enjoying a nice little bump – most likely due to Porsche’s success.
Will it last?
Time will tell – which is why I’m urging you to become a subscriber to my elite trading service, GorillaTrades…
If you’re having trouble navigating these rough economic waters like millions of other investors – let us help guide you.
We make it easy – we do all the heavy lifting – all you have to do is decide how much you want to invest and hit the buy button.
Or, you can continue to keep poking around in the dark.
It’s time you had help… and GorillaTrades is all the help you’ll need.
Regardless, keep your eyes peeled for luxury brands for the time being – they’re among the few companies profiting right now – and could be a fit for your portfolio.
Until next time…
“Some people think luxury is the opposite of poverty. It is not. It is the opposite of vulgarity.” – Coco Chanel