Green Mountain Boiled Following Earnings (GMCR, SBUX, JVA)
May 3, 2012 by Paul Ausick
Green Mountain’s partner in some products and competitor in others, Starbucks Corp. (NASDAQ: SBUX), isn’t getting beaten up too badly because its deal with Green Mountain isn’t critical to the Seattle-based giant. One stock that is getting beaten up is Coffee Holding Co. Inc. (NASDAQ: JVA), down about -12%. Coffee Holding Co. is one of Green Mountain’s main suppliers, not a good thing to be today.
Among the many issues Green Mountain listed in its earnings report last night was higher coffee prices. That seems a little disingenuous. Coffee prices today are hovering around $1.75/pound for Arabica, down from more than $3/pound just a year ago. Green Mountain must have bought a mountain of the stuff and saved it until now in order to be blaming coffee prices, which have been falling almost non-stop since a September peak at around $2.90/pound.
Green Mountain’s trading volume today tops 73 million shares, more than 13x average daily volume. Shares are down -49.4% at $25.08 after posting a new 52-week low of $24.40. The prior range was $39.42-$115.98. Coffee Holding Co. shares are down about -12.6% at $7.67 in a 52-week range of $5.63-$30.98. Volume is only slightly higher than normal.
Paul Ausick
Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE
Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.