Stocks to Buy – Green Mountain Coffee Roasters (GMCR)
In March GMCR shareholders will approve Green Mountain Coffee Roasters’ (GMCR) name change to Keurig Green Mountain Inc. The new name will reflect the importance of its Keurig single-serve coffee system to its overall business but also to signal that its future goes beyond coffee. GMCR hired former Coca-Cola (KO) executive Brian Kelley to make this happen.
In a July interview in Fortune, Kelley made his plans crystal clear, stating:
“Over time we have a simple mission, which is to get a brewer in every home and in every place of work, and then have a beverage for every occasion. We know that there’s opportunity for us to use Keurig brand-name and platform to be able to offer more beverages then what we offer today.”
Of the 26 stocks on the most heavily shorted list, this is the one I feel could benefit most from a short squeeze because there are still a lot of investors who seem to think this company is a flash in the pan — including myself. Two years ago, I called it a “fading fad.”
Boy was I wrong.
Kelley was set to take the helm of Coca-Cola Refreshments before GMCR persuaded him to think bigger. Over the next 2-3 years, investors will reap the rewards. Coke’s loss is definitely Keurig Green Mountain’s gain. With GMCR up 7.8% year-to-date through Jan. 22, I wouldn’t count on immediate gains. Rather, it will start to move up once more information leaks out about its own version of SodaStream (SODA).
Of my three picks, GMCR is the best of the stocks to buy — period.
As of this writing, Will Ashworth did not own a position in any of the aforementioned securities.