Green Mountain Coffee Grounded — Wednesday’s IP Market Recap

by Marc Bastow | May 2, 2012 5:18 pm

IPMarketRecap Green Mountain Coffee Grounded    Wednesdays IP Market Recap[1]Wednesday’s biggest splash came after the bell, as Green Mountain (NASDAQ:GMCR[2]) got hammered on weak K-Cup sales and lowered full-year expectations.

The company reported second-quarter K-Cup sales growth of 59%, but that was a huge step down from 115% growth last quarter. Green Mountain also downgraded its earnings forecast from a range of $2.55 to $2.65 per share to a range of $2.40 to $2.50 per share.

The company’s Q2 earnings weren’t as dour, with profits up more than 40% to $93 million (58 cents per share), and adjusted earnings of 64 cents per share in line with analyst estimates. Revenues of $885.1 million were up 37% but widely missed estimates of $971.7 million. Still, investors slammed GMCR shares by 40% in early after-hours trading.

During the day, a disappointing jobs report weighed on the broader markets. Payroll giant ADP reported a disappointing 119,000 jobs were added to the economy in April, far below a forecast of 170,000 and March’s 201,000. The news from Europe wasn’t any better, as eurozone unemployment rose to 11%.

The Dow finally came to rest down fractionally at 13,268, while the S&P settled lower by 0.25% at 1,402. The Nasdaq managed to squeeze out a gain, rising 0.31% to 3,059.

While economic news overshadowed the day, several companies — including Comcast (NASDAQ:CMCSA[3]), CBS (NYSE:CBS[4]), CVS Caremark (NYSE:CVS[5]) and Time Warner (NYSE:TWX[6]) — all posted solid results for the quarter.

TWX rode increased subscriptions and popular movie releases[7] to post improved revenues and adjusted earnings per share higher than analyst estimates, while Comcast’s NBC Universal division and their Super Bowl broadcast powered the company’s earnings [8]over both last year’s results and analysts’ estimates. However, both stocks dropped for the day, with TWX losing 1.6% and CMCSA down 0.6%.

CBS fell in line with the other media companies as both revenues and earnings came in higher [9]than last year and beat forecasts. CBS also bucked the media stock price decline, rising 2.3% on the day.

Drug store chain CVS beat both top- and bottom-line estimates, as Walgreen (NYSE:WAL[10]) customers caught in the middle of a dispute with Express Scripts (NASDAQ:ESRX[11]) walked on over to CVS to get their prescriptions filled. CVS rose 2.7% on the day’s news.

MasterCard (NYSE:MA[12]) reported first-quarter revenue of $1.76 billion, up from $1.5 billion in the year-ago period, while net income came in at $5.36 per share compared to $4.31 last year — both metrics were in line with expectations, though shares fell about 1% Wednesday. Reporting after the bell, Visa (NYSE:V[13]) said fiscal second-quarter profit surged 47% as customer spending on credit and debit cards rose. Visa shares were up more than 3% in early after-hours trading.

Earnings release notables for Thursday include General Motors (NYSE:GM[14]), Viacom (NASDAQ:VIAB[15]), Orbitz (NYSE:OWW[16]) and Sara Lee (NYSE:SLE[17]).

Three Up

Three Down

Marc Bastow is an Assistant Editor at As of this writing he did not hold any position in the aforementioned securities.

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  19. Read more about CHRS here.:
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  23. Read more about CHK here.:
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