These Arizona businessmen help feed the nation, but they're not farmers
Morning. In today's opinions newsletter: How Arizona feeds the nation, plus Phoenix's immigration protests and the struggles of a mom who works four jobs and still can't buy a home.
Guillermo Martinez is not your stereotypical produce importer.
He studied physics and dreamed of working for NASA.
But he's the fifth generation in this business. His extended family owns a regional chain of grocery stores in Mexico. You might say that fruits and vegetables are in his blood.
So, he founded Frello Fresh, a small but still relatively new produce importer amid a sea of giant, refrigerated warehouses along Interstate 19 north of Nogales. Together, they process billions of pounds of produce each year from Mexico.
Elvia Díaz and I visited him on Friday, just hours before President Donald Trump announced a 25% tariff on Mexican produce, to learn how this often overlooked part of the food system works.
What we found, and I explain in more detail today, is that imported produce is a key part of how Arizona helps feed the nation — and that any changes to this complex system are bound to increase our grocery bills.
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Miami Herald
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Analysts reboot Olive Garden parent's stock price targets as earnings loom
One night in December 1982, a tradition was born. The very first Olive Garden restaurant opened its doors on International Drive in Orlando, Fla., and the crowds just kept on coming. Don't miss the move: Subscribe to TheStreet's free daily newsletter In a bid to manage the throngs of customers, the restaurant offered free bread and salad, leading to the popularization of Olive Garden's unlimited breadsticks and salad. Today more than 900 Olive Garden restaurants operate in the U.S. The company is owned by Darden Restaurants (DRI) , which also owns several popular full-service restaurant chains, including, LongHorn Steakhouse and The Capital Grille. Bloomberg/Getty Images "Our ability to deliver profitable sales growth in this challenging environment is a testament to the strength of our business model," Chief Executive Rick Cardenas told analysts during the company's earnings call in March. The Olive Garden team, he said, "continues to use news to appeal to core guests as well as value seekers in this environment." "For the first time since before Covid, they are bringing back their signature buy-one-take-one limited-time offer," Cardenas said "With a price starting at $14.99, guests choose from seven entrees for their dining experience and then take a second entree home. This has historically been a high-traffic-driving promotion for Olive Garden." More Restaurants Beloved Mexican restaurant closing iconic location after 63 yearsMajor restaurant chain quietly closes several locationsIconic restaurant closing its doors after 32 years Total sales increased 6.2% to $3.2 billion in the quarter, driven by a blend of same-restaurant sales increase of 0.7% and sales from the acquisition of 103 Chuy's restaurants and 40 net new restaurants. The restaurant industry lately has been facing several challenges. A number of restaurants are closing as the sector contends with high costs, economic uncertainty and falling customer traffic. Consumers expect to spend 7% less each month on restaurants this summer than they did a year earlier, according to KPMG's Consumer Pulse Summer 2025 report. "Consumers aren't just belt-tightening - they're rethinking value altogether," Duleep Rodrigo, KPMG's consumer and retail sector leader, said in a statement. "It's not only about cutting back; it's about being intentional with every dollar spent," Rodrigo added. "In this environment trust, transparency and tangible impact matter more than ever. To win today's consumer, brands need empathy, innovation and a clear reason to matter." Related: Major restaurant chain quietly closes several locations Fast-food visits are up 26%, the firm said, while casual dining is down 38% - driven largely by cost-conscious households. Darden recently announced plans to close 15, or more than a third, of its Bahama Breeze restaurants and shutter two of its Seasons 52 casual restaurants. In addition, many people are eating at home, something Campbell's (CPB) CEO Mick Beekhuizen noted during the company's earnings call. "Consumers continue to cook at home and focus their spending on products that help them stretch their food budgets, and they're increasingly intentional about their discretionary snack purchases," Beekhuizen said. Another factor: Ozempic and similar GLP-1 drugs might be prompting restaurant customers to eat less, order less frequently and looking for healthier options. Shares of Darden Restaurants, which hit all-time high on June 16, have surged almost 20% this year and nearly 50% from a year ago. The company is scheduled to post fourth-quarter earnings on June 20 and investment houses have been issuing research reports. Jefferies analyst Andy Barish upgraded Darden to hold from underperform with a price target of $210, up from $165, according to The Fly. The firm has become "increasingly positive" on Darden's ability to return its core Olive Garden brand to "Every Day Affordable Price" leadership in casual dining and compete more effectively for traffic going forward.. Although Darden's valuation is "still rich," the improvements at Olive Garden merit an upgrade to hold, the analyst said. Yahoo Finance pegs the company's price-to-earnings multiples at 24.5 for the trailing 12 months and 20.3 for the forward 12 months. Stephens analyst Jim Salera raised the firm's price target on Darden to $200 from $178 and affirmed an equal-weight rating on the shares. The analyst said in a Q4 earnings preview that he continues to model fiscal 2025 same-store sales modestly below the company's guidance. But Salera said the impact of Darden's sales initiatives, including new menu items and increased marketing support, were apparent in the traffic data as Olive Garden and LongHorn both showed sequential improvement each month during the quarter. On June 16 UBS analyst Dennis Geiger raised the investment firm's price target on Darden to $245 from $225 and maintained a buy rating on the shares. Related: Fund-management veteran skips emotion in investment strategy The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
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2 hours ago
- Business Insider
I shopped at Costco to see if the store has raised prices due to tariffs. Here are the biggest changes I noticed.
Costco is buying more US-made items and rerouting inventory to avoid raising prices due to tariffs. I shopped at Costco in June and compared prices to when the tariffs were announced in April. A few items were more expensive, but most cost the same, and some had even gotten cheaper. While some retailers are raising prices due to President Donald Trump's sweeping "reciprocal" tariffs on over 180 countries, Costco is taking a different approach. On Costco 's third-quarter earnings call on May 29, CEO Ron Vachris said the company is buying more items produced in the US and rerouting inventory bound for US stores to locations in other countries to avoid paying tariffs and raising prices. "We're watching pricing daily, and if not hourly, on every key commodity," Vachris said. This strategy was evident on my latest shopping trip. When the tariffs were announced in April, I tracked the origins of every item I purchased at Costco to see how much of my usual grocery list could be affected. Out of the 23 items I bought in April, at least 12 were imported or contained imported ingredients. I took the same grocery list to Costco in June and tracked all of the price changes I saw. While a few items from my April grocery list had gotten more expensive, most of the prices had stayed the same, and some had even decreased. Some of the changes I tracked may be due to tariffs, but they could also be regular fluctuations caused by other factors such as inflation or supply and demand. A representative for Costco declined to comment. While some of Trump's tariffs took effect immediately in April, others have been paused until July. Even as some other stores have announced increased prices due to tariffs, the measures have yet to spike prices across the board. The Bureau of Labor Statistics found that the consumer price index, a measure of the average change in prices paid by urban consumers over time, increased by 0.1% in May, and the food index rose by 0.3%. Here are all of the price differences I noticed at Costco. As per usual, a long line stretched outside Manhattan's sole Costco store when I arrived just before its 10 a.m. opening. Beginning June 30, Costco's executive members will be able to shop an hour earlier than Gold Star members. I hope this exclusive access will mean shorter lines and a less crowded shopping experience first thing in the morning. I was surprised that most of the produce I bought cost the same as it did on my last grocery trip, even though much of it was imported. Trump announced 25% tariffs on both Mexico and Canada in February, months before the "Liberation Day" establishment of "reciprocal" tariffs on other countries in April. Agricultural products were not subject to the new tariffs per the United States-Mexico-Canada Agreement, but the US will begin taxing Mexican tomatoes with a 21% duty beginning July 14, the Associated Press reported. Despite being a product of Mexico with a Canadian distributor, a two-pound tomato medley from Sunset stayed the same price at $7.99. Other products of Mexico and Canada on my shopping list, such as raspberries, cucumbers, and mashed avocado packets, also cost the same as they did in April. I'd anticipated higher prices on produce at Costco as the CEOs of companies like Walmart and Target warned consumers of potential grocery price hikes due to tariffs. The one exception was grapes, which were a product of the US and cost 50 cents more than the imported grapes I bought in April. Last time I shopped at Costco in April, I bought 3 pounds of purple grapes from Chile for $7.49. On this visit in June, Costco stocked a different brand of red grapes grown in the US that cost $7.99 for a 3-pound package. In the third-quarter earnings call, Vachris said the company planned to buy more domestically made products as alternatives to increasingly expensive imported items. With a domestic supplier, the grapes still slightly increased in price, which could be due to different production and labor costs at the new supplier. Kirkland's organic roasted seaweed, sourced from South Korea, cost a dollar more than it did in April — a 9% price increase from $10.99 to $11.99. The price of Kind bars, which are made in the US, had decreased by about 11.5% since my last trip. The box of 22 bars said that they were made in the US "with domestic and imported ingredients." The price of the Kind bars decreased from $19.99 in April to $17.69 in June. The price of Costco's Kirkland-brand lemonade went up 10 cents, from $6.29 in April to $6.39 in June for two 3-quart bottles. Costco's US branch distributes the lemonade, but the label doesn't say where it was produced or where its ingredients were sourced. If the lemons used are not grown in the US, it's possible that they've become more expensive to import due to tariffs. India, Mexico, and China are the top three lemon producers in the world, The Takeout reported, and were all hit with steep tariffs: 26% on India, 25% on Mexico, and 10% on China. Costco didn't respond to a request for comment. Other juices on my shopping list, such as gallon-sized bottles of passion orange guava juice, cost the same as they did in April at $5.99 each. Some price changes were due to limited-time sales, like a $3 discount on Nature's Path organic granola. Nature's Path organic granola was on sale for $5.99 during my June shopping trip. I'd previously paid $8.99 in April. The pumpkin seed and flax granola comes in 35.5-ounce bags. Nature's Path's website says that it "does not currently purchase any products internationally that would require 'product of…' labeling." Egg prices at Costco decreased dramatically. In February, I bought a carton of 24 cage-free large eggs at Costco for $8.49. I was lucky to even get one — the supply ran out just minutes after the store opened due to shortages caused by avian flu. Things have improved steadily since then as the bird flu outbreak has become better contained. When I shopped at Costco in April, a carton of 24 cage-free large eggs cost $7.69. In June, the price lowered to $5.79, with an overall decrease of around 32% since February. Overall, prices at Costco hadn't changed much. Their strategy appears to be working. Out of the 23 items on my grocery list I compared from April, only three became more expensive, and three decreased in price. On the third-quarter earnings call, Costco CFO Gary Millerchip said that keeping prices low for members pays off despite squeezed profit margins. When prices eventually fall, he said, it allows the company to "feel the margin relief faster while also being able to lower prices more quickly than our competitors." I'm grateful Costco has largely kept its prices the same, choosing to lower profit margins instead of passing higher costs on to consumers.
Yahoo
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Musk's Daring Gambit Has Managed to Do Something Remarkable: Alienate Democrats AND Republicans
It appears that Elon Musk has seriously overestimated his sustained popularity among his right-wing fans. In another masterful display of cunning, the world's richest man turned coat and viciously lashed out at his former best-friend-in-chief Donald Trump this month. It was a very public affair, as both parties traded blows over social media — and Trump at his many press conferences — but it was Musk who came out looking worse for wear, unable to equal the president's threats, squirming at the cold indifference he was being shown. In retrospect, his mysterious black eye was a prefigurement of things to come. And so in decidedly un-Don-Corleone fashion, the "Dogefather" all but groveled at the feet of the president this week, offering a simpering apology. But the damage had been done. According to a new poll from the Associated Press, fewer Republicans view Musk "very favorably" compared to April, plunging from 38 percent down to 26 percent. "Some things have happened lately that have changed how I feel about him a little," Alabama Republican Katye Long, who downgraded her view of Musk to "somewhat favorable," told the AP. "I also don't feel like he matters that much," she added. "He's not actually part of the government. He's just a rich guy who pushes his opinions." As far as high-profile fallouts go, this one was veritably cataclysmic. After Musk stepped down as a "special government employee," he blasted Trump's spending bill and trash-talked the president on his website, X. Trump, in turn, threatened to kill Elon's billions of dollars worth of government contracts. Musk made his own threat that he'd cut off NASA's access to SpaceX, before declaring that Trump is implicated in the unreleased Epstein files and agreeing that the president should be impeached. "Without me, Trump would have lost the election, Dems would control the House and Republicans would be 51-49 in the Senate," Musk fumed on his website X, after Trump said he was "disappointed with Elon." "Such ingratitude," Musk huffed. All the while, reports circled that the tech billionaire was heavily abusing drugs like ketamine — and to boot, incurring the unfortunate bladder issues that commonly stem from overusing the powerful anesthetic. It's not the end of the world for Musk, though. The polls suggest that most Republicans — 64 percent — still favor him to some degree, which is three points lower than April. He remains extremely unpopular among Democrats, however, though the repulsion he inspires among this base has slightly ebbed. In April, 74 percent of Democrats harbored a very negative view of Musk, but that share has now fallen to 65 percent. That may be a consequence of his diminished role in government since April; last month he finally left his role as a top advisor to Trump. In sum, in the AP's analysis, the intensity of the public's attitude towards Musk has shifted somewhat, but the overall opinions haven't. Musk has become an incredibly polarizing figure over the past several years, over the course of which he has expressed increasingly far-right views. He ensured the alienation of his traditionally liberal fans by endorsing Trump last summer and funding his campaign to the tune of some $300 million. Post-inauguration, Musk led his so-called Department of Government Efficiency, where he oversaw the firing of tens of thousands of federal employees, the slashing over 100 billion dollars of federal spending — including cuts to foreign aid and research grants at the National Institutes of Health — and tampering with Social Security. Most damning for Musk's bottom line: the backlash has blown back on his businesses, too. Tesla's popularity has plummeted in lockstep with its drying-up sales, and according to the recent poll, only 32 percent of US adults view his automaker very or somewhat favorably. That's far worse than any other brand; General Motors, which isn't exactly a PR darling, boasts a 60 percent favorable view. The irony is that Musk's courting of the right has seemingly done little to win over new devotees to the Tesla brand, with nearly a third of Republicans — 30 percent — having an unfavorable opinion of the EV company, while Democrats stand at 66 percent. If his master plan was eventually getting both sides to hate him equally, then we'd say he's finally starting to do a bang-up job. More on Elon Musk: Elon's Explosion at Trump Appears to Have Cost Him a HUGE Deal
