Duckhorn Wine Co. ($NAPA) made its public debut Thursday at $18 per share, marking the first IPO out of California's famous Napa Valley in decades.
CEO Alex Ryan told Cheddar that the company, which owns Kosta Browne, Decoy, Goldeneye, and other individual winemakers, has stayed profitable during the pandemic that forced wineries to rapidly adapt their business models.
He said the company chose now to go public to gain further exposure to "luxury consumers."
"We've been creating a one-of-kind luxury winery asset for 40 years now, and I think it's a great time to introduce luxury wine to Wall Street and beyond," Alex Ryan, president and CEO of Duckhorn, told Cheddar. "We've created some really nice scale. The customers are telling us they want more of it, and so we're poised to give it to them."
While wineries have generally avoided public markets in the past, Duckhorn isn't the only California-based producer making the leap this spring. Santa Rosa’s Vintage Wine Estates plans to go public this May via a merger with a special purpose acquisition company.
Ryan explained how Duckhorn's whole operations and retail partners have helped maintain demand through the pandemic, even as restaurant sales fell off.
"We find people have embraced buying larger amounts of wines through grocery stores, taking them home, having the experiential time with their favorite brands, and then they're going to go back and buy some more," he said.
As for the spate of wildfires that ripped across the West Coast in 2020, Ryan said the company's efforts to diversify its sources throughout the region have prepared it for the disruption.
This diversity has also softened the volatility inherent in agricultural production, he added, which has been a challenge for public wine companies in the past when it came down to providing reliable guidance on quarterly earnings.
"We think we've got the recipe so we can again manage volatility and be able to share with investors what they want to hear moving forward," he said. "We really don't find that to be a stumbling block. It has been for others in the past. We think we've got a way around that right now."
Duckhorn's stock finished the day at $17.50 per share.
It’s a chicken-and-egg problem: Restaurants are struggling with record-high U.S. egg prices, but their omelets, scrambles and huevos rancheros may be part of the problem. Breakfast is booming at U.S. eateries. First Watch, a restaurant chain that serves breakfast, brunch and lunch, nearly quadrupled its locations over the past decade to 570. Fast-food chains like Starbucks and Wendy's added more egg-filled breakfast items. In normal times, egg producers could meet the demand. But a bird flu outbreak that has forced them to slaughter their flocks is making supplies scarcer and pushing up prices. Some restaurants like Waffle House have added a surcharge to offset their costs.
William Falcon, CEO and Founder of Lightning AI, discusses the ongoing feud between Elon Musk and Sam Altman, and how everyday people can use AI in their lives.
U.S. tariffs on steel and aluminum “will not go unanswered,” European Union chief Ursula von der Leyen vowed on Tuesday, adding that they will trigger toug
The Trump administration has ordered the Consumer Financial Protection Bureau to stop nearly all its work, effectively shutting down the agency that was created to protect consumers after the 2008 financial crisis and subprime mortgage-lending scandal. Russell Vought is the newly installed director of the Office of Management and Budget. Vought directed the CFPB in a Saturday night email to stop work on proposed rules, to suspend the effective dates on any rules that were finalized but not yet effective, and to stop investigative work and not begin any new investigations. The agency has been a target of conservatives since President Barack Obama created it following the 2007-2008 financial crisis.
Jeff Benedict, author of 'The Dynasty,' weighs in on the Kansas City Chiefs being the next big dynasty, who he thinks will win Super Bowl LIX and more. Watch!
