Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of single-cup coffee-brewing expert Green Mountain Coffee Roasters (NAS: GMCR) were steaming hot today, gaining as much as 25% in intraday trading before closing with a 23.9% increase.
So what: Since we're right smack in the middle of earnings season, it should be no surprise to hear that Green Mountain's brew-tastic stock performance today was on the back of a well-received earnings report. On an absolute basis, the results looked very impressive, with sales for the December quarter more than doubling from the prior year to $1.16 billion and non-GAAP earnings per share soaring from $0.18 to $0.60. Even better, both tallies topped Wall Street predictions, which had the company earning just $0.36 per share on $1.06 billion in sales.
Now what: What's ahead for Green Mountain? Well, I can tell you this much: There is no doubt room for some "I told ya so's" from Green Mountain bulls right now. The chorus of naysayers had grown loud before this release, and many bears were claiming that an influx of competition was going to kneecap this coffee-pod potentate. As the numbers clearly show, this couldn't have been further from the truth in the December quarter.
If there was an itty-bitty hitch in the celebratory release -- a hitch, mind you, that most investors appear to not be too worried about -- it's that even with the blowout earnings for its fiscal first quarter, the company simply reaffirmed its prior guidance for the full fiscal year, which ends in September. This is a bit of a head-scratcher, but it could simply mean that management wants to leave itself some room to continue to give investors more than they expected.
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At the time thisarticle was published Motley Fool newsletter services have recommended buying shares of and creating a lurking gator position in Green Mountain Coffee Roasters. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.Fool contributorMatt Koppenhefferhas no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting hisCAPS portfolio, or you can follow Matt on Twitter,@KoppTheFool, or onFacebook. The Fool'sdisclosure policyprefers dividends over a sharp stick in the eye.
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