Keybanc: Keurig Green Mountain Inc Outlook 'Conservative'

Keurig Green Mountain Inc

fell sharply Thursday on disappointing guidance and news that its chief financial officer will resign. But an analyst said the company is on track with long-term goals. The Waterbury, Vt.-based coffee machine maker's shares fell more than 7 percent Thursday to $142.64. Keybanc's Akshay S. Jagdale reiterated a Buy rating and $175 target Thursday and said lower than expected guidance was due "mainly to conservatism." Jagdale said the company is seeing success with a campaign to license popular brands of coffee for the so-called pods used by its proprietary, single-cup machines. A plan to launch a home-use, carbonated beverage dispenser to compete with Sodastream International Ltd.

appears on track for the autumn of 2015, Jagdale said. Late Wednesday, the company predicted profits of $0.83 to $0.88 cents a share for the first quarter, versus Wall Street's expectation of $0.96 cents. Fourth-quarter net income rose 11 percent to $148.8 million, or $0.90 a share, versus Wall Street's expectation of $0.77 cents. Sales grew 14 percent to $1.2 billion. The company also said its Chief Financial Officer Frances Rathke, 53, will resign in 2015 after 11 years in the role.