Sunday, May 25, 2014

How Will This Downgrade Affect Keurig Green Mountain (GMCR) Stock?

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NEW YORK (TheStreet) -- Shares of Keurig Green Mountain Inc.  (GMCR) were downgraded to "neutral" from "buy" at Roth Capital which maintained its price target of $120.00.

The stock is down -1.18% to $112.46 in pre-market trade.

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Separately, TheStreet Ratings team rates KEURIG GREEN MOUNTAIN INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate KEURIG GREEN MOUNTAIN INC (GMCR) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity." Highlights from the analysis by TheStreet Ratings Team goes as follows: GMCR's revenue growth has slightly outpaced the industry average of 3.0%. Since the same quarter one year prior, revenues slightly increased by 9.8%. Growth in the company's revenue appears to have helped boost the earnings per share. GMCR's debt-to-equity ratio is very low at 0.08 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.84, which clearly demonstrates the ability to cover short-term cash needs. KEURIG GREEN MOUNTAIN INC has improved earnings per share by 18.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, KEURIG GREEN MOUNTAIN INC increased its bottom line by earning $3.16 versus $2.28 in the prior year. This year, the market expects an improvement in earnings ($3.74 versus $3.16). 47.54% is the gross profit margin for KEURIG GREEN MOUNTAIN INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 14.69% is above that of the industry average. Net operating cash flow has increased to $320.94 million or 19.95% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -20.80%. You can view the full analysis from the report here: GMCR Ratings Report STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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