Sara Lee Corporation
Thesis
Sara Lee is a company with many products and has been trimming down and selling various businesses. The introduction of single serve coffee has been successful, and the company is expected to split into two parts, which could lead to significant upside.
Did it work?
failed
confidence: high
The pitch was long Sara Lee expecting 'significant upside' from ongoing divestitures, single-serve coffee momentum, and an eventual split into two companies. While the split catalyst did ultimately occur, the realized price performance since the pitch was -76.9% — a catastrophic loss that decisively contradicts the upside thesis regardless of how much time has elapsed. The corporate events largely played out, but the investment outcome was the opposite of what the thesis predicted.