GMCR
Keurig Green Mountain Inc
Consumer
11/16/2015
Presented
| Date | 11/10/2015 |
| Price | $50.04 |
| Market Cap | $7.79B |
| Ent Value | $12.47B |
| P/E Ratio | 14.8x |
| Book Value | $18.14 |
| Div Yield | 0% |
| Shares O/S | 155.60M |
| Ave Daily Vol | 2,613,403 |
| Short Int | 13.52% |
Current
| Price | $91.67 |
| Market Cap | $13.70B |
| Keurig Green Mountain, Inc. engages in the specialty coffee and coffeemaker businesses. The company operates its business through two segments: Domestic and Canada. The Domestic segment designs and sells hot beverage system brewers and accessories and sources, produces and sells coffee, hot cocoa, teas and other beverages under a variety of brands in K-Cup, Vue, Rivo, K-Carafe and Bolt portion packs and coffee in more traditional packaging, including bags and fractional packs, to retailers including supermarkets, department stores, mass merchandisers, club stores, and convenience stores; to restaurants, hospitality accounts, office coffee distributors, and partner brand owners; and to consumers through a consumer-facing website. The Canada segment sells hot beverage system brewers and accessories, and sources, produces and sells coffee and teas and other beverages under a variety of brands in K-Cup, Rivo and K-Carafe portion packs, and coffee in more traditional packaging, including cans, bags and fractional packs, to retailers including supermarkets, department stores, mass merchandisers, club stores, office coffee distributors, and, through its office coffee services business, to offices, convenience stores, restaurants, hospitality accounts, and to consumers through its consumer-facing website. The company was founded by Robert P. Stiller on July 1, 1981 and is headquartered in Waterbury, VT. |
Publicly traded companies mentioned herein: Bed Bath & Beyond Inc (BBBY), Best Buy (BBY), The Coca Cola Co (KO), Dunkin Brands Group Inc (DNKN), Keurig Green Mountain Inc (GMCR), The Kraft Heinz Company (KHC), Mead Johnson Nutrition Company (MJN), Starbucks (SBUX), TreeHouse Foods Inc (THS), Wal-Mart Stores Inc (WMT)
Highlights
The presenter is short shares of Keurig Green Mountain (GMCR) and said he believes the company’s “heavy handed” negotiations with large distributors (i.e., Wal-Mart and Best Buy) and aggressiveness with brewers (i.e., Starbucks and Dunkin’ Donuts) over licensing fees may have placed a target on its back that could lead to underperformance. A participant mentioned being long the stock and a healthy debate ensued covering everything from GMCR’s K-Cup capacity and new CFO Peter Leemputte to competition, whether or not it has lost its moat, and the failure of Keurig KOLD. Overall, the presenter sees competition and licensors’ heightened negotiating power as likely to lead to disappointing earnings and a re-rating of GMCR shares lower over coming quarters.
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