QUOTE AND NEWS
Market Intelligence Center  Aug 17  Comment 
Green Mountain Coffee Roasters Inc. (GMCR) traded between $49.93 and $50.90 before closing at $50.60 Friday and presents some attractive trading opportunities today according to MarketIntelligenceCenter.com's patented algorithms. The computer...
Benzinga  Aug 13  Comment 
Shares of Keurig Green Mountain Inc (NASDAQ: GMCR) are down roughly 35 percent since August 5. In a report issued Thursday, Roth Capital Partners analyst Anton Brenner said that, while at current valuations, the stock seems inexpensive --...
Forbes  Aug 13  Comment 
In early trading on Thursday, shares of Cisco Systems (CSCO) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 4.2%. Year to date, Cisco Systems registers a 4.5% gain.
Forbes  Aug 6  Comment 
In early trading on Thursday, shares of Michael Kors Holdings (KORS) topped the list of the day's best performing components of the S&P 500 index, trading up 11.4%. Year to date, Michael Kors Holdings has lost about 41.4% of its value.
TheStreet.com  Aug 6  Comment 
NEW YORK (TheStreet) -- Keurig Green Mountain shares are down by 29.78% to $52.65 in early market trading on Thursday, after the company reported third quarter earnings that topped analysts' expectations, but also guided current quarter...
Benzinga  Aug 6  Comment 
In a report published Thursday, Goldman Sachs analyst Judy E. Hong downgraded the rating on Keurig Green Mountain, Inc. (NASDAQ: GMCR), while lowering the price target from $120 to $66. The stock was also removed from Goldman Sachs' Americas Buy...
TheStreet.com  Aug 5  Comment 
NEW YORK (TheStreet) --Keurig Green Mountain is scheduled to release its 2015 third quarter earnings results after the market close on Thursday afternoon. Analysts are expecting the specialty coffee and coffee maker business to post a year...
Clusterstock  Aug 5  Comment 
Benzinga  Aug 3  Comment 
In a report published Monday, Morgan Stanley analyst Matthew Grainger maintained an Overweight rating on Keurig Green Mountain Inc (NASDAQ: GMCR), while reducing the price target from $130 to $110. Analyst Matthew Grainger mentioned that the...
Benzinga  Jul 30  Comment 
Keurig Green Mountain Inc (NASDAQ: GMCR) is scheduled to announce its third-quarter financial results after the market closes next Wednesday. Wedbush analysts Phil Terpolilli and Dominic Ruccella previewed the results, concluding that near-term...




 

Green Mountain Coffee Roasters (NYSE: GMCR), headquartered in Waterbury, Vermont, provides premium, specialty coffees and coffee products. GMCR operates in two business segments: Green Mountain Coffee Roasters (ground coffee and coffee beans) and Keurig (the "one-cup coffee brewer"). In the past fiscal year, the firm has profited from the increased popularity to its Keurig business. However, coffee bean prices, the primary commodity input for GMCR, rose 72% in 2010,[1] which caused the firm's profit margin to decline 15%.[2]


Business Overview

In the past fiscal year, the success of the Keurig brand has driven GMCR sales, as the firm saw an 81% sales growth in its Keurig products.[2] Coffee prices have been surging since January 2010, causing GMCR profit margins to further tighten.

Trends and Forces

GMCR Profit Margins Pressured by Coffee Bean Prices

Green Mountain Coffee Roaster has a high dependence to its primary raw material: coffee beans. As the price of coffee beans, typically imported from Latin and South America, Southeast Asia, and Africa, rises, GMCR needs to pass these costs to consumers or create a more efficient production process to avoid lower profit margins.

Keurig's Niche Product Drives New Revenue Streams

Green Mountain Coffee owns the Keurig one-cup coffee maker business -- a niche product in an industry traditionally composed of coffee pot brewers and cafes. As the one-cup style of coffee making gains popularity, the firm can leverage its brand recognition to expand the business. For example, when GMCR announced it will sell Starbucks (SBUX) coffee in Keurig's patented K-Cup, the firm's stock increased 41%.[3]

Competition

GMCR's competitors include:

  • Starbucks (SBUX): The world's top coffee seller by revenue, Starbucks also sells in-house brewed coffee and other food products.
  • Peet's Coffee & Tea (PEET): Similarly to Starbucks, PEET focuses on its in-house brewed coffee.
  • Dunkin' Donuts (privately held): Sells coffee and tea products, but doughnuts and food products as well.
  • The Folger Coffee Company: Like GMCR, Folger sells coffee beans and ground coffee to be brewed at home.

References

  1. Commodity Online, "Global coffee prices to go high on 2011," 12/23/2010
  2. 2.0 2.1 GMCR 2010 10-k
  3. Seeking Alpha, "A Nasty Week and a Highly Caffeinated Short," 03/11/2011
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