Green Mountain Coffee Grounded — Wednesday’s IP Market Recap

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

IPMarketRecap Green Mountain Coffee Grounded    Wednesday's 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 InvestorPlace.com. As of this writing he did not hold any position in the aforementioned securities.

Endnotes:
  1. [Image]: http://investorplace.com/hot-topics/investorplace-market-recap/
  2. GMCR: http://studio-5.financialcontent.com/investplace/quote?Symbol=GMCR
  3. CMCSA: http://studio-5.financialcontent.com/investplace/quote?Symbol=CMCSA
  4. CBS: http://studio-5.financialcontent.com/investplace/quote?Symbol=CBS
  5. CVS: http://studio-5.financialcontent.com/investplace/quote?Symbol=CVS
  6. TWX: http://studio-5.financialcontent.com/investplace/quote?Symbol=TWX
  7. increased subscriptions and popular movie releases: http://investorplace.com/2012/05/time-warner-earnings-sales-beat-forecasts/
  8. powered the company’s earnings : http://investorplace.com/2012/05/comcast-q1-earnings-spike-30-shares-fall/
  9. revenues and earnings came in higher : http://investorplace.com/2012/05/cbs-q1-profit-jumps-80-shares-rise/
  10. WAL: http://studio-5.financialcontent.com/investplace/quote?Symbol=WAL
  11. ESRX: http://studio-5.financialcontent.com/investplace/quote?Symbol=ESRX
  12. MA: http://studio-5.financialcontent.com/investplace/quote?Symbol=MA
  13. V: http://studio-5.financialcontent.com/investplace/quote?Symbol=V
  14. GM: http://studio-5.financialcontent.com/investplace/quote?Symbol=GM
  15. VIAB: http://studio-5.financialcontent.com/investplace/quote?Symbol=VIAB
  16. OWW: http://studio-5.financialcontent.com/investplace/quote?Symbol=OWW
  17. SLE: http://studio-5.financialcontent.com/investplace/quote?Symbol=SLE
  18. CHRS: http://studio-5.financialcontent.com/investplace/quote?Symbol=CHRS
  19. Read more about CHRS here.: http://investorplace.com/2012/05/rival-buying-lane-bryant-parent-for-890m/
  20. AEO: http://studio-5.financialcontent.com/investplace/quote?Symbol=AEO
  21. ZNGA: http://studio-5.financialcontent.com/investplace/quote?Symbol=ZNA
  22. CHK: http://studio-5.financialcontent.com/investplace/quote?Symbol=CHK
  23. Read more about CHK here.: http://investorplace.com/2012/05/the-worsening-stink-at-chesapeake-energy/
  24. SD: http://studio-5.financialcontent.com/investplace/quote?Symbol=SD
  25. HLF: http://studio-5.financialcontent.com/investplace/quote?Symbol=HLF

Source URL: http://investorplace.com/2012/05/economys-tale-wags-the-dows-dog-wednesdays-ip-market-recap-adp-cmcsa-cbs-cvs-twx-wal/
Short URL: http://invstplc.com/1nyiSSA