One of the biggest markets in the world is disappearing.
Once a traditional consumer-favorite, dairy is officially on the outs. Gone are the days of making your kids finish their milk before they leave the dinner table. People aren’t adding heavy cream to their coffee anymore. The phrase “Got milk?” makes me feel nostalgic, not original.
Sure, toddlers are still drinking milk from sippy cups and people everywhere are still gorging on cheese pizza. But the dairy industry isn’t what it used to be – and two companies in particular have already paid the price.
But this isn’t just a warning sign. It’s a profit opportunity. America’s taste buds are changing – and they could end up padding your pockets in the process..
Here’s how to profit off the falling dairy industry now – before it’s too late…
Turn the World’s Decreasing Dairy Demand into Your Next Profit
Since 2015, milk consumption has dropped 6%. And over the past decade alone, almost 20,000 U.S. dairy farms have closed, according to the United States Department of Agriculture. That’s a 30% drop – and it’s falling faster every day.
From 1992 to 2018, dairy farms were closing at a rate of 10 per day, according to the National Farmers Union. And one of the biggest culprits of the declining demand for milk comes from alternative products.
If you’ve been to a trendy coffee shop within the last decade, I’m sure you’ve seen them. Soy, almond, cashew, oat – all different plant-based products used to create healthier milk alternatives. And while traditional milk consumption drops, these products are rocketing.
According to the Plant Based Foods Association, sales of plant-based milk have grown 14% in the past two years. From April 2018-April 2019, sales of oat milk alone made a massive 222% jump. And just this past Tuesday, the biggest name in coffee, Starbucks Inc. (NYSE: SBUX), began testing oat milk in its Midwestern stores.
For plant-based milk, the future is bright. But the same cannot be said for the cow milk industry.
Must See: These opportunities gave my readers a chance to amass over $210,000 in just four months. And now, you can experience this profit potential firsthand…
In just the past two months, two of the largest milk producers in the world have filed for bankruptcy. The first was Dean Foods, a fluid milk manufacturing company based in Texas. Dean Foods filed on November 12, with CEO Eric Beringause citing “continuing declines in consumer milk consumption” as the main perpetrator.
Then, on Monday, January 6, U.S. dairy processor Borden Dairy Company followed in Dean Foods’ footsteps. After the company’s bankruptcy filing, CEO Tony Sarsam said:
“Despite our numerous achievements during the past 18 months, the company continues to be impacted by the rising cost of raw milk and market challenges facing the dairy industry.”
We’ve known about the decline of milk consumption for a while now, especially as the vegan diet picked up popularity over the past decade. But the fact that two of the country’s top milk producers have now filed for bankruptcy is a serious wake up call for the industry.
Borden was a privately owned company, but one look at Dean Foods’ stock performance is all you need to know that the dairy sector is in trouble. From the start of 2019 to the date of its bankruptcy filing, shares of Dean Foods declined 79%.
The company is now off the market, with intent to sell itself in the future. But it’s not the only dairy producer sounding alarms…
Lifeway Foods Inc. (NASDAQ: LWAY) is the biggest manufacturer of kefir in the U.S. Kefir is a fermented milk drink – and it’s not an exception to milk’s downfall. Over the past five years, LWAY shares have dropped a whopping 89%. And if Dean and Borden’s bankruptcy is any indication, LWAY still has more room to fall.
But a failing stock isn’t always a money pit. Not if you’re using options, that is…
You see, a put option gives you the right, but not the obligation, to sell an underlying security at a fixed price by a specific date. And it allows you to profit off a falling stock.
Here’s an example that my readers played just last summer…
On July 30, 2019, digital payment giant Paypal Holdings Inc. (NASDAQ: PYPL) was trading around $110.79. After a mixed earnings report, the stock started to fall, causing investors in the world’s top payment company to lose money.
But not my readers. They didn’t lose money on PYPL’s fall – they made it.
They could have purchased a put option for just $1.50, or $150 for control over 100 shares. And just three days later, on August 2, shares of PYPL had indeed continued their drop, falling down to around $109.47.
Now, that’s just a little over a $1 fall. Which doesn’t sound like that much cash to lose.
But that measly $1 fall allowed my readers to sell their put for $3.00. They didn’t just make money on this trade – they doubled it.
In just three days, my readers made a 100% gain on PYPL’s .01% slip. Imagine what they could have done with Dean Foods’ 79%!
Again, Dean Foods is now off the market. But the opportunity to profit off of the fall of the dairy industry hasn’t passed you by just yet. Dean and Borden aren’t the only companies paying the price of consumers’ lack of interest in drinking milk.
I already told you about LWAY’s swift decline. And that’s just one of many dairy companies falling under the “endangered” category. Now, with options, you can play these companies for fast cash – before they become extinct.
To your success,
Tom Gentile
America’s #1 Pattern Trader
