Green Mountain Shares Plummet on Revenue Miss

Wednesday, 09 Nov 2011 05:49 PM

 

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Keurig coffee machine maker Green Mountain Coffee Roasters missed Wall Street's quarterly revenue estimates, knocking 30 percent off the value off its stock at a time when an influential short seller is questioning the company's business practices.

Shares of Green Mountain, the largest U.S. single-cup coffee company, fell 30 percent to $46.75 after the bell.

The stock has fallen 27 percent since Oct. 17 when Greenlight Capital's David Einhorn said he turned negative on the company and cast doubt on Green Mountain's accounting practices and long-term earnings potential.

Green Mountain saw the third-largest net increase in short positions on Nasdaq in the second half of October, with short interest rising to 24.7 million shares on Oct. 31 from 17.1 million on Oct. 14. That rise indicates that more people think that the company's stock price and business will weaken.

However, Green Mountain forecast a profit for the holiday quarter that was largely above analyst estimates.

The company reported fourth-quarter sales of $711.9 million. Analysts were looking for sales of $760.5 million, according to Thomson Reuters I/B/E/S.

Net income was $75.4 million, or 47 cents a share, compared with $27 million, or 20 cents a share, a year earlier. Adjusted profit was 47 cents a share, compared with the 48 cents that analysts were expecting on average.

The Waterbury, Vermont-based company missed sales estimates for the first time in more than eight quarters, and failed to beat profit expectations after five quarters.

© 2014 Thomson/Reuters. All rights reserved.

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