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Chris DeMuth Jr.
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"It's not given to human beings to have such talent that they can just know everything about everything all the time. But it is given to human beings who work hard at it - who look and sift the world for a misplaced bet - that they can occasionally find one." - Charlie Munger I look... More
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  • Wine Arbitrage 21 comments
    Apr 2, 2013 7:23 PM | about stocks: STZ, BUD

    We have a bit of an investment in Constellation Brands (NYSE:STZ), which appears likely to secure antitrust approval for their deal with Anheuser-Busch InBev NV (NYSE:BUD) by this time next week. We hope to make a few bucks, but here is a related idea that I like even more. While we're on the topic of wine, the following idea is simple: free money + good wine.

    My idea is to sign up for this wine service in which you get insider access to fine wines that are made available in small quantities at reasonable prices. With your free membership, you get a $10 credit into your account for you to use within 48 hours.

    How to use it? They have a seasonal wine club that offers $112 of wine for $49 and is currently offering an additional $10 of credit. So, net of total credits, you are getting over 74% off for good wines. At your discretion, cancel subsequent shipments.

    Your purchase will be at a substantial discount to the sum of the parts valuation. The Balius Chardonnay 2009 is not my favorite (no offense Balius - this is wholly due to my generally lack of enthusiasm for Chardonnay), but at a $11.95 value (perfectly good for dinner party gifting purposes) this is over a third of your expense. The 2009 Borgo Pretale Le Crete Chianti Classico is worth another $22.99. So, you pay under 83% for these two bottles, and you get the other four (quite good) wines free and clear.

    If you don't like this one, then you don't like wine or you don't like free money.

    Disclosure: I am long STZ.

    Themes: wine Stocks: STZ, BUD
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Comments (21)
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  • bazooooka
    , contributor
    Comments (2893) | Send Message
     
    Yup, $39 bucks for 6 bottles of decent table wine - not bad. Especially since you'll have a 10 credit to get the deal again for $39. Also I'd think this would make a great gift for those who don't value wine even at this reduced rate. Most of my friends would think this a great present or maybe I now can go to 6 dinner events and never appear empty handed =)
    2 Apr 2013, 07:46 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » $29. There are two $10 credits -- the first for joining and your first order and the second for this specific product.
    3 Apr 2013, 07:13 AM Reply Like
  • Wilson Wang
    , contributor
    Comments (857) | Send Message
     
    I love articles like this! Exploiting value investing from a consumer point of view! Love it!
    3 Apr 2013, 04:33 AM Reply Like
  • Dr. Kris
    , contributor
    Comments (330) | Send Message
     
    Another fun, out-of-the-box article--well done! BTW, last May 2nd, I recommended Treasury Wine Estates $TSRYY to my subscribers. It's risen 26% since then.

     

    Yes, this is a shameless plug but I do think the entire beverage area is worth a look especially since it's been in rally mode.

     

    Dr. K
    3 Apr 2013, 02:42 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Nice; thanks.
    3 Apr 2013, 02:44 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (546) | Send Message
     
    No wine by mail in the "great state" of Pennsylvania :(
    3 Apr 2013, 02:51 PM Reply Like
  • Union Trade Assoc
    , contributor
    Comments (849) | Send Message
     
    enjoyed the article immensely, Chris. and we've owned STZ long enough for a few bottles of Bordeaux to properly age as well ... all good selections !
    3 Apr 2013, 03:08 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Nice. If you're interested, here is a previous wine-related blog post:

     

    http://seekingalpha.co...
    3 Apr 2013, 03:11 PM Reply Like
  • Perkins Cove
    , contributor
    Comments (633) | Send Message
     
    "ummm... to make a great wine you must have the soul of a gambler". Kevin Kline to Meg Ryan in the movie French Kiss.

     

    And now you have Dr. Kris's attention. Wine and fine dining....it doesn't get any better.

     

    Do I see a new restaurant in NYC....."Chris & Kris".....?
    (can I get in on the ground floor.....grin)
    4 Apr 2013, 10:54 AM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Court Allows Settlement to Proceed Among the DOJ, Constellation Brands, Anheuser-Busch InBev and Grupo Modelo: http://bit.ly/10wELcI
    23 Apr 2013, 11:44 AM Reply Like
  • crown51
    , contributor
    Comments (2) | Send Message
     
    No post settlement bounce?
    30 Apr 2013, 01:35 AM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Great question. I bought most of my position in early February when the suit was first announced. The market is a discounting mechanism that converged on the correct implied probability as the deal with the DoJ was worked out. This started as a variant view, but ended as a conventional one.
    30 Apr 2013, 07:34 AM Reply Like
  • Special Situations and Arbs
    , contributor
    Comments (589) | Send Message
     
    Chris.......any thoughts on buying a new bed and couch without paying an arm and a leg?
    30 Apr 2013, 08:37 AM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Pottery Barn gift cards for purchase at 10% discount:

     

    http://bit.ly/100OWPz Figure out how much you plan to spend and buy that amount of discounted gift cards.

     

    Additionally, there is another 10% off for orders with newly joining their e-mail distribution list.

     

    Here’s one on sale: http://bit.ly/16hEvzp;

     

    Small, but decent sale.

     

    All sorts of sales on individual beds:

     

    http://bit.ly/100OWPD

     

    Then, right before ordering, double check http://bit.ly/16hEvzx near you for the exact product you want in a lower price.
    30 Apr 2013, 08:55 AM Reply Like
  • Special Situations and Arbs
    , contributor
    Comments (589) | Send Message
     
    you are the best..thanks!
    30 Apr 2013, 09:40 AM Reply Like
  • Special Situations and Arbs
    , contributor
    Comments (589) | Send Message
     
    You would be proud of me. I bought a discontinued model (bed) from Sleepys.....It was a $2000 bed for $899......after lying on the bed in the store I called Sleepys online and got the same discointinued model for $799 with free shipping.......

     

    Next up a couch
    8 May 2013, 10:59 AM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Well done. Underpaying warms my heart.
    8 May 2013, 09:05 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Reinventing the Wine Club Business: http://bloom.bg/19er4iC
    17 Jun 2013, 08:36 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Is Wine Bullshit?

     

    http://bit.ly/13Iy9IA
    9 Jul 2013, 08:46 AM Reply Like
  • Perkins Cove
    , contributor
    Comments (633) | Send Message
     
    Absolutely not! It's the fermented juice of a grape. (or other fruit) So it definitely is NOT bullshit. I know bullshit when I see/smell it....grin

     

    The 'bullshit' factor, in my opinion, comes from the psychology that surrounds wine. The 'cache', snobbery', and 'romanticism' is the bullshit part.

     

    Mrs. Perkins and I took on the task, about 2 decades ago, to find out for ourselves if more expensive wines were worth it. In a nutshell our conclusion was...if it was wet, red, and the bottle said Merlot on it...it was ok to drink. No need to pay more than $10 per bottle. We did find a standard by which to measure other wines. And for us that was Forrest Glen Merlot, out of California.

     

    Others may have different results after an extensive (decades) testing procedure such as we endured.

     

    Enjoy. (wink)
    9 Jul 2013, 01:05 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4371) | Send Message
     
    Author’s reply » Excellent research and conclusion. Well worth the research intensive approach.
    9 Jul 2013, 01:44 PM Reply Like
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