So I'm sure that by now, all of you have heard of David Einhorn and Greenlight Capital's very public short position in Green Mountain Coffee Roasters (GMCR), courtesy of Dealbreaker. GMCR is a VT-based manufacturer of high end Keurig brewing machines and patented single-serve "K-cups."
After announcing Q4 earnings and missing revenue estimates, GMCR's stock is down -28% in the pre-market. The stock has already has already lost -40% of its value since September.
Is the market overreacting to the earnings release and giving Einhorn too much credibility? Greenlight has been struggling to bag an elephant since the financial crisis and has returned a paltry -6% YTD.
Greenlight's investment thesis: www.dealbreaker.com/uploads/2011/10/Greenlight-Ca…
Earnings transcript: http://seekingalpha.com/article/306831-green-moun…
Green Mountain Coffee Roasters is based in Vermont, not Connecticut.
I think the market has been over reacting to earnings and news releases for a while. There is too much emotion in the market and stock swings. When some of the managers get their position public it becomes, almost, a self-fulfilling prophecy. People tend to think the managers are right and play into their position, making them money.
And, then complaining about the amount of money the manager made.
My bad, corrected on top.
Might look into this as a potential entry point for a long position...
Sam Antar has been beating this drum, like, forever. He called GMCR a complete scam from Day One, and if anyone can recognize a scam, it's him. He called GMCR out on this shit a year ago:
http://whitecollarfraud.blogspot.com/2010/12/green-mountain-coffee-roas…
[quote=Edmundo Braverman]Sam Antar has been beating this drum, like, forever. He called GMCR a complete scam from Day One, and if anyone can recognize a scam, it's him. He called GMCR out on this shit a year ago:
http://whitecollarfraud.blogspot.com/2010/12/green-mountain-coffee-roas…]
This dude's disclosure at the end of his post is nuts! Holy shit.
holy shit that guy is the man... modern day "Catch Me If You Can"
LOL. Yup, Sam's the real deal.
I mean Einhorn has obviously done his due diligence, and that presentation is pretty fucking damning...
obviously anyone taking the long view should double check everything that Einhorn looked at, and be VERY certain of their thesis...i personally would be a bit wary of getting long at this point.
I was hoping nobody would post about this because it made me sad. I was banging some GMCR chick last week and she said I needed to short this thing because it wasn't going to be pretty. I didn't follow through on the puts.... got a lot of in's though.
jack I'm gonna have to call you out on that one
I think the reaction is very similar to NFLX inasmuch that they're both high P/E, growth-driven stocks that have lost pricing power for the first time in their respective markets
Might change my mind after further examination though
Everyone should read Einhorn's presentation. Damning is putting it lightly, it crushes it completely. There is no doubt that a fuck ton of work went into the decision to short it, really unbelievable stuff.
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