Remember When the Grilled Cheese Truck (GRLD) Was Worth $100 Million?

Henry Truc  |

Apparently, today is National Grilled Cheese Day, and here at Equities.com, we like to follow these sorts of things...as cheesy as they may seem. But in the spirit of today's celebration of one of America’s all-time great comfort foods, it felt appropriate to check in on every investor's favorite purveyor of hot bread and melted cheese: The Grilled Cheese Truck, Inc. (GRLD). Just how much did investors love Grilled Cheese Truck, which sells grilled cheese sandwiches in a truck, last year? Enough to push it to a $100 million market cap.

We broke down some of the ways the valuation could have been justified at the time, though bear in mind, this was mostly done in jest:


Now, some of you innovation-hating naysayers are probably already busy dreaming up ridiculous criticisms of that valuation. You’re probably fixating on how the company lost $5.61 million in 2013, or how it only actually has four trucks in operation. I can hear these simpletons now: “I would never buy a stock trading at 40 times sales.” “How can food trucks possibly expect to compete with the myriad of fast-casual options popping up?” “EIGHT DOLLARS FOR A GRILLED CHEESE SANDWICH?!?!”

Some say that absence makes the heart grow fonder, and being that we're a year removed from the grilled cheese bubble, let's see if the saying proves true in the case of Grilled Cheese Truck.

Alas, it did not. At its current levels of $.020 per share, the Grilled Cheese Truck comes in with a valuation of just under $4 million. Ouch.

But the company is in the midst of a re-branding, operating under the umbrella of American Patriot Brands, and has ambitions to be the dominant food truck company in the market. Its website states:

American Patriot Brands started as The Grilled Cheese Truck, Inc. (OTC: GRLD), a Southern California based food truck phenomenon. Today, we have acquired American brands and partnerships which complement our effort to dominate the American food truck movement which is estimated to grow to $30 Billion at it's mature state.
Our highest commitment is to serve the men and women who have served the American people. To do this, we are creating hundreds of jobs, as well as, license ownership opportunities to qualified U.S. Veterans.
The Grilled Cheese Truck, Inc. is the first food truck to become traded publicly. With our current strategy, we are organized and uniquely positioned for rapid growth in this highly-fragmented food truck industry.

In his letter to shareholders in February, the company's CEO Robert Lee stated:

“I believe with all my heart that the mission of our Company is correct, our industry is ripe for our best brand consolidation strategy, and that our timing as first mover is perfect.”

Lee went on to explain, “The first mover in a highly fragmented industry at its infancy is faced with challenges; however, investors in this stage have the opportunity to earn greater than average returns, and I believe that the opportunities with GRLD are far greater than the challenges, which is why I have invested two years’ worth of my salary in the Company’s future.”

In addition to its flagship Grilled Cheese Trucks, the company also has The Los Lobos Truck, which serves a variation on different comfort foods, and The Original Soupman, which serves soups. It's also added burger chain Ruby's Diners to its portfolio as well. While the company is hoping to regain the sizzle from last year’s buzz, it’ll be interesting to see how many investors will have the necessary appetite for risk - and cheesy goodness - to see this stock reheated.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
GRLD American Patriot Brands Inc - Ordinary Shares 0.75 0.15 25.00 5,750

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