10 BARRON’S February 15, 2021
REVIEW
31,458.
Dow Industrials:+310.
Dow Global Index:+9.
1.20%
10-year Treasury note:+0.
BYE, MAGAZINE; HI, BRANDING
Hit Records
All three stock indexes closed the
week at record highs, fueled by Covid
stimulus hopes and progress in con-
taining the disease. Bitcoin also rose,
approaching $50,000, as Elon Musk’s
Teslaannounced that it had bought
$1.5 billion worth and could start tak-
ing it as payment for cars. For the
week, the Dow industrials rose 1%, to
31,458.40; the S&P 500 added 1.2%,
to 3934.83; and the Nasdaq Composite
wasup1.7%,at14,095.47.
The Trial Begins...and Ends?
The impeachment trial of former Pres-
ident Donald Trump began in the Sen-
ate, with the prosecution and defense
concluding arguments by Friday. A
vote could come as early as this week-
end. All 50 Democrats and at least 17
Republicans would be required for a
conviction, a tally that seemed un-
likely, given the 44 GOP votes against
the constitutionality of the trial.
Accounting for Relief
House Democrats released a $1.9 tril-
lion Covid-relief proposal containing
direct payments of $1,400 for anyone
making $75,000 or less and including
a federal minimum wage of $15 an
hour to be phased in over four years.
The Congressional Budget Office
agreed that the new wage would
reduce poverty—it will give raises
to 27 million and lift 900,000 out of
poverty—but argued that it could cost
1.4 million jobs over the five years and
deepen the deficit.
The Latest on the Pandemic
The Centers for Disease Control and
Prevention on Friday urged the na-
tion’s K-12 schools to reopen as soon
as possible, issuing new guidelines on
how to do so safely...China refused
to provide the World Health Organi-
zation with raw, personalized data
on early Covid cases that could aid
scientists’ understanding of the dis-
ease’s beginning...The holiday surge
of Covid infections has passed, with
new U.S. cases down 56% over the
past month on a seven-day average,
and hospitalizations off 38%. Nearly
35 million have received vaccinations,
over 10% of the population.
Playboy’s
New Model
Forget what you once knew about Playboy Enterprises.
That male-focused, Hugh Hefner–founded media busi-
ness is gone; it published its final print magazine last
spring. Playboy now resembles a more inclusive global
consumer-products start-up, but with a decades-old
brand, worldwide recognizability, and the famed
bowtie-clad rabbit logo.
RenamedPLBY Group(ticker: PLBY), it began trad-
ing Thursday onNasdaq. After a previous publicly traded
stint, and then a decade in private hands, it went public
again via a merger with Mountain Crest Acquisition—a
special-purpose acquisition company, or SPAC. The deal
gave PLBY roughly $100 million to grow its business.
In the past few years, Playboy largely wound down its
media businesses and pivoted toward brand licensing and
consumer goods. “The product we sell at the end of the
day, it’s not our clothing, it’s not our condoms, it’s the
brand itself,” CEO Ben Kohn tellsBarron’s.
Kohn says that licensed and owned Playboy-branded
items–including lingerie, sex toys, perfumes, furniture,
and fashion-forward apparel—generated more than $
billion in sales in over 180 countries last year.
Playboy is debuting with an enterprise value of some
$540 million, or 13.5 times management’s $40 million
forecast for 2021 adjusted earnings before interest,
taxes, depreciation, and amortization, or Editda. Not
bad, compared with, say,Nike’s 33.5 times orRevolve
Group’s 35 times. Playboy’s mission is to “create a cul-
ture where all people can pursue pleasure.” Why
shouldn’t that include investors?
$
Price of Brent crude oil per
barrel on Monday, topping the
high for 2020 on Feb. 20, 2020.
2 %
The yield on 30-year Treasuries,
the first time at that level since
February 2020.
29 K
Level of Japan’s Nikkei 225
index, breaching that threshold
for the first time since 1990.
$10 B
At 8 cents, the estimated market
value of Dogecoin, the joke,
meme-driven cryptocurrency,
after being talked up by Elon
Musk and WallStreetBets.
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THE NUMBERS
SHE SAID:
“I’ve spent many years
studying inflation
and worrying about
inflation. And I can
tell you we have the
tools to deal with that
risk if it materializes.”
Treasury Secretary Janet Yellen,
on the possible inflationary effects
of the Covid-19 relief measure
Rethinking China
The Biden administration is launching a
review of security risks of Chinese com-
panies targeted under Trump, including
the forced sale of ByteDance’s TikTok unit
toOracleandWalmart.Another Trump
executive order banning transactions with
eight Chinese apps, including Ant Group’s
Alipay andTencent Holdings’ WeChat,
remains in limbo, as do actions taken
against telecom Huawei Technologies.
Annals of Deal Making
AppleandHyundai Motorbroke off
talks on the Korean company assembling
Apple’s electric car...Elliott Management
has explored raising a billion-dollar spe-
cial purpose acquisition vehicle...Video-
game developerElectronic Artswill
acquireGlu Mobilefor $2.4 billion...
Reddit doubled its valuation to $6 billion
after raising $250 million from venture
firm Vy Capital...Dating appBumble,
controlled byBlackstone,went public
at an $8.6 billon valuation. Illustration by Elias Stein; Andrew Harrer/Bloomberg