Week's Winners and Losers: Drones Soar, Cupcakes Fall Flat

March 27, 2013 - Los Angeles, California (CA, USA - David Heidel of Aerovironment, shows their Qube drone. (Credit Image: © Rin
Ringo Chiu/Zuma Press/Alamy
There were plenty of winners and losers this week, including a fast-growing pastry shop that ran out of dough and had to shut its stores, and a maker of unmanned aircraft vehicles soaring after a blowout quarterly report. Here's a rundown of the week's best and worst.

Nikola Tesla -- Winner

Funding for a Nikola Tesla museum was announced on Thursday with Telsa Motors (TSLA) CEO Elon Musk is contributing $1 million to build the homage to Tesla on the grounds of the inventor's lab in Long Island.

Brainy humorist Matthew "The Oatmeal" Inman has been championing a museum to honor the underrated visionary, taking to Twitter a few months ago to appeal for Musk's financial contribution. It worked. The museum's getting built. Musk gets one step closer to becoming Tony "Iron Man" Stark incarnate. And Tesla Motors does the right thing by honoring the man that gave it its name.

The Container Store (TCS) -- Loser

Remember when retailers dismissed concerns about sloppy holiday showings because of the snowstorms that blanketed a lot of the country in December and January? Remember how those same retailers then blamed the Easter holiday shift -- from March last year to April this year -- as a reason for the slow traffic the following quarter? Well, it seems that many chains are still stumbling, and they're running out of excuses.

%VIRTUAL-article-sponsoredlinks%"We thought our sluggish sales were all because of weather and calendar shifts that began last November and continued into the spring, but now we've come to realize it's more than weather and calendar," The Container Store's CEO said on Tuesday. Kip Tindell blamed his storage and housewares store's weakness on a "retail funk" that's going around. Symptoms include "traffic declines" a "tepid retail environment" and "challenging sales."

The Container Store warned that it will fall short of its earlier profit and sales targets for this fiscal year. Comparable store sales declined during the quarter ending in May, and that may not get a whole lot better until a couple of quarters later.

AeroVironment (AVAV) -- Winner

Unmanned aerial vehicles have been growing in popularity, and not just from Amazon tantalizing the market several months ago with dreams of drone-delivered Internet orders.

AeroVironment is a leader in this niche, and it wrapped up fiscal 2014 this week with another blowout quarterly report. AeroVironment saw revenue soar 36 percent to $73.5 million, well ahead of the $69.6 million that analysts were expecting. AeroVironment's profit of 36 cents a share blew away the 23 cents a share that the pros were targeting. It also boosted its guidance for the new fiscal year that began in May.

Crumbs Bake Shop -- Loser

That's the way the cupcake crumbles. On Monday, shortly after its stock was given its delisting notice from the Nasdaq exchange, Crumbs Bake Shop announced that it would close its 50 remaining bakeries.

We probably should have seen this coming. The cupcake chain was posting widening losses, and it was in default on its debt. Some are saying that this is the end of the cupcake craze, but it's really more a cautionary tale about expanding too quickly as a leveraged company. Cupcakes aren't going away, but Crumbs Bake Shop might.

Or it might not: Just two days after the company announced it was closing up shop, Marcus Lemonis went on CNBC and said he intended to lead an investor group that would bail out and acquire Crumbs. So, stay tuned: The cupcakes could rise again.

Netflix (NFLX) -- Winner

Emmy nominations were handed out on Thursday, and Netflix easily won "Most Improved" honors with 31 nods, up from 14 nominations a year earlier.

Three shows and a documentary that premiered exclusively on Netflix made the cut, with "Orange Is the New Black" and "House of Cards" accounting for 25 nominations. Yes, Netflix was far behind industry leader Time Warner's (TWX) HBO with 99 nominations. But the important takeaway here is that Netflix continues to prove that studios can turn to Netflix's streaming service without feeling as if they are settling for less.

Motley Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends AeroVironment, Netflix, Tesla Motors, and The Container Store Group. The Motley Fool owns shares of AeroVironment, Netflix, Tesla Motors, and The Container Store Group. Try any of our newsletter services free for 30 days.
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