QUOTE AND NEWS
Market Intelligence Center  Jul 1  Comment 
Green Mountain Coffee Roasters Inc. (GMCR) traded between $75.32 and $76.77 before closing at $76.63 Tuesday and presents some attractive trading opportunities today. MarketIntelligenceCenter.com’s patented algorithms selected a Aug. '15 $75.00...
Benzinga  Jun 22  Comment 
In a report published Monday, Longbow Research analyst Alton Stump maintained a Neutral rating on Keurig Green Mountain Inc (NASDAQ: GMCR), expressing concerns related to the upcoming Keurig Kold launch scheduled for this fall. "While we have a...
Benzinga  Jun 15  Comment 
Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show. Keurig Green Mountain Inc (NASDAQ: GMCR) traded higher on Monday by $0.99, up more than 1 percent. The issue, which made a new made new 52-week low...
Forbes  Jun 12  Comment 
In early trading on Friday, shares of Citrix Systems (CTXS) topped the list of the day's best performing components of the S&P 500 index, trading up 2.6%. Year to date, Citrix Systems registers a 13.2% gain.
TheStreet.com  Jun 12  Comment 
NEW YORK (TheStreet) -- Shares of Keurig Green Mountain Inc  were stalling, down 2.73% to $82 in early market trading Friday, after analysts at UBS downgraded the coffee machine maker to "neutral" from "buy" earlier this morning. Analysts at...
Benzinga  Jun 11  Comment 
In a report published Thursday, Susquehanna analyst Pablo Zuanic maintained a Positive rating and price target of $117 on Keurig Green Mountain, Inc. (NASDAQ: GMCR), following data that suggests strong performance by the K-Cup category. K-Cup...
Forbes  Jun 5  Comment 
In early trading on Friday, shares of Keurig Green Mountain (GMCR) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 2.8%. Year to date, Keurig Green Mountain has lost about 35.2% of its value.
Benzinga  Jun 5  Comment 
In a report published Friday, Morgan Stanley analyst Matthew Grainger maintained an Overweight rating on Keurig Green Mountain Inc (NASDAQ: GMCR), while reducing the price target from $140 to $130. The stock is currently trading at a significant...
Benzinga  May 28  Comment 
In a report published Thursday, Wedbush analyst Phil Terpolilli initiated coverage of Keurig Green Mountain Inc (NASDAQ: GMCR) with a Neutral rating and a price target of $100, even after the recent downturn in the company's share price. In...




 

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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