Coffee to get pricier as companies pass on costs to consumers. (00:22) CoreWeave (CRWV) sets IPO listing price at $40, less than its earlier midpoint estimate of $51. (02:02) Levi Strauss (LEVI) in talks to sell Dockers brand to Marquee - report. (03:26)Episode transcripts seekingalpha.com/wsb.Show links: Biggest stock movers Friday: LULU, X, and moreAuto tariffs: TSLA, RIVN, LCID produce their vehicles in U.S., F better positioned than GMTrump administration seeks control over future investments in Ukraine's infrastructure, minerals - reportEurope sales decline is temporary, revamped Model Y can help Tesla - AnalystsHSBC terminated investment bankers on bonus day, didn't pay bonuses: reportSign up for our daily newsletter here and for full access to analyst ratings, stock quant scores, dividend grades, subscribe to Seeking Alpha Premium at seekingalpha.com/subscriptions.
Chapter 1: Why are coffee prices increasing?
Welcome to Seeking Alpha's Wall Street Breakfast, where we cover the top news for investors every morning. Good morning. Today is Friday, March 28th. I'm Julie Morgan. How much are you willing to pay for a cup of coffee? CoreWeave trims its IPO and Dockers could soon have a new owner.
You've heard a lot about the increase in the price of eggs in recent months, but what about the juice that keeps you going? No, not OJ, a cup of Joe. Reuters reported that you may soon have to pay up to 25% more for coffee, as companies such as Lavazza, Nestle, and J.D.E. Peets are reportedly in talks with retailers to raise prices to pass on the cost from surging Arabica prices to consumers.
Chapter 2: What factors are affecting global coffee production?
According to the Food and Agriculture Organization, world coffee prices jumped to a multi-year high in 2024. Production has been impacted by prolonged dry weather and drought in Brazil and Vietnam, as well as heavy rains in Indonesia. Brazil and Vietnam together account for more than 50% of the world's coffee production.
Chapter 3: How much will coffee prices rise in 2025?
Global prices for the higher-quality Arabica, favored in the roast and ground coffee market, soared 70% last year and gained another 20% so far in 2025. Reg Watson, the director of equity research at ING, told Reuters that retail prices could rise 15 to 25%. Dutch firm JDE Peet said it would hike prices to absorb the cost from coffee inflation.
And one Brazilian roaster reportedly raised roast and ground prices by 14.3% in March, after hikes of 11% in January and 10% in December. Folgers coffee maker J.M. Smucker, which raised prices last June and October, said it expects another hike in the first half of the next fiscal year.
Chapter 4: What is CoreWeave's IPO strategy?
Corweave set its initial public offering price at $40, which is less than its earlier estimate, selling 37.5 million shares for $1.5 billion. The offering comprises 36.59 million shares of Class A common stock to be sold by the firm and 910,000 shares to be sold by existing stockholders.
In addition, the company has granted the underwriters a 30-day over-allotment option to purchase up to an additional 5.6 million shares. The stock goes live on the NASDAQ this morning under the ticker symbol CRWV. The offering is expected to close on March 31st, subject to the satisfaction of customary closing conditions.
Chapter 5: How has CoreWeave adjusted its IPO due to market conditions?
The artificial intelligence hyperscaler expected a midpoint of $51 per share, according to a filing last week with the U.S. Securities and Exchange Commission. However, the company downsized to incentivize investors. The reduction in share volume and value was also related to recent stock market volatility, according to Bloomberg. This gives it a valuation of around $20 billion.
NVIDIA, a backer of CoreWeave, was expected to buy $250 million worth of shares at $40 each, according to various reports. NVIDIA owned about 6% of the company before this reported haul. Marquee Brands is in exclusive discussions with Levi Strauss to purchase the Dockers brand.
According to a Women's Wear Daily report on Thursday, which cited unidentified sources, if a transaction with Marquee does not happen, there are other buyers, including authentic brands. The timing of a potential deal was not clear, though Levi Strauss is scheduled to report its Q1 results on April 7th.
Marquee could not be reached for comment by Women's Wear Daily, and Levi's declined to comment on Thursday. The report comes after Levi Strauss announced in October that it was considering strategic alternatives for its Dockers brand, which could result in a sale. Now let's take a look at what's trending on Seeking Alpha. Auto tariffs. Tesla, Rivian, and Lucid produce their vehicles in the U.S.
Ford is better positioned than GM. The Trump administration reportedly seeks control over future investments in Ukraine's infrastructure and minerals. Analysts say Europe's sales decline is temporary and the revamped Model Y can help Tesla. And HSBC reportedly terminated investment bankers on bonus day and did not pay the bonuses. On our Catalyst Watch for the day, it's very light.
Newsmax is expected to price its upcoming IPO. Now for a look at the markets today ahead of the opening bell. Dow S&P and Nasdaq futures are in the red. Crude oil is flat at $69 a barrel. Bitcoin is down 2.5% at $85,000. In the world markets, the FTSE 100 is down 0.1% and the DAX is down 0.5%. Lululemon Athletica is on our list of the biggest movers of the day pre-market.
Lulu is down 12% despite a strong Q4 as disappointing guidance and weaker than expected same-store sales overshadowed earnings. On today's economic calendar, at 8.30 a.m., personal income and outlays. At 10 a.m., consumer sentiment.
At 12.15 p.m., the Fed's Michael Barr will participate in a banking policy discussion before the 2025 Banking Institute event hosted by the University of North Carolina Law School. And at 3.45 p.m., the Fed's Rafael Bostic will moderate the U.S. Housing Finance Policy Panel before the third annual Georgia Tech Atlanta Fed Household Finance Conference. That's it for today's Wall Street Breakfast.
Thanks for listening. To take full advantage of Seeking Alpha, join the highest quality community of real investors discussing stocks and ETFs at seekingalpha.com slash subscriptions. I'm your host, Julie Morgan. Go out and make it a great day.
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