Green Mountain looks to maintain momentum with earnings
February 6, 2013, 3:36 PM
As usual, the report will be closely scrutinized. Green Mountain is locked in battle with Starbucks SBUX +0.69% , the coffee industry’s 800-pound gorilla, where the ultimate prize is dominance of the lucrative single-brew market. Its weapon? The Keurig K-Cup.
Despite missteps, setbacks and fierce competition through much of last year, Green Mountain has since November bolstered its operations and rebuilt its battered share price. Ahead of the report, Green Mountain shares are trading at $48.52, up 175% from its $17.11 low in July.
The recovery’s main catalysts have been growing sales of Green Mountain’s upgraded Keurig single-cup coffee brewer — in both its Rivo and Vue versions — and improved fiscal transparency after putting earlier accounting questions behind it. The progress has earned Green Mountain a string of recent analyst upgrades. According to FactSet, since January 71% of the analysts following the stock have overweight ratings on the company, 21% call it a hold, and 7% recommend underweighting it. Their average price target: $86 a share.
Analysts surveyed by FactSet are looking for Green Mountain to report first-quarter earnings of 65 cents a share, up from 6 cents a year ago, and a 15% rise in revenue to $1.33 billion. They will be looking for evidence the company can maintain the upward momentum built during the previous quarter. Right now, Wall Street is looking for guidance that would confirm their consensus 73-cent per-share second quarter profit and $2.69 full-year forecast.
Other stocks worth keeping an eye on following Green Mountain’s results include single-brew rival Mondelez International MDLZ -0.63% and, of course, Starbucks.
– Jim Jelter
Follow Jim Jelter on Twitter @jjelter
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