Canaccord Expects Several Years of Growth for Green Mountain Coffee
Canaccord has published a research report on Green Mountain Coffee (NASDAQ: GMCR) as the company is showing holiday sales in-line with expectations.
In the report, Canccord writes, "We expect several years of rapid growth, driven by rising penetration of Keurig single-cup coffee makers in coffee-drinking households that should drive higher revenue growth and even higher rates of earnings growth as the margin story unfolds. We reiterate our 27% brewer growth forecast for the key holiday quarter and expect results to meet expectations. No price promotion of any significance ever materialized, which leads us to believe that retailers met their own expectations. However, B40 brewer inventories at retail seem high post holiday vs. last year and our expectations. We now expect a higher shift toward third-party brewers as we gauge strong sales for Mr. Coffee, specifically, but also good Cuisinart sales. Holiday 2011 should be the last period of big brewer shipment growth as we suspect market share of new brewer sales approached 40% for all K-cup brewers."
Canaccord maintains its Buy rating and $94 price target on Green Mountain Coffee, which closed yesterday at $46.58.
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