Sequentially, Revenue declined from $717M in June Q to $712M in Sep Q. Yet, there was this astonishing increase in inventories: from 417.5 to 672.3, a whopping increase of $254.8M!!!
GMCR right now is holding so much inventories that worth almost an entire quarters revenue!
A big inventory write off seems to be forthcoming!
Decent Bearish arguement... I guess?
BUT Year over Year... Sales in this Q LAST YEAR was 373 Mil (NOW 711 Mil)... and sales were pretty flat all of last year!
THIS YEAR they have gone from 574 mil to 711 mil!
Me thinks they are still kicking A$$, and taking NAMES!!!
Anyone not gettign shares on this gift and holding LT is an idiot IMO!
What if the revenue growth was all a mirage? The result of moving inventories from one warehouse to the next?
By the way, some people here have no rudimentary accounting knowledge: inventories that are sold to Walmart or SAMs club or other channel partners are not on the company's balance sheet! The huge increase in inventories on the balance sheet cannot be easily explained. I have offered by explanation, happen to be the same as Einhorns, that is the company is shifting inventories around within the company and then books that transaction as revenue. Got it?
All that extra inventory is now in Sams and Costco. Visited both and as soon as you walk in the entire space is dedicated for Kcups and Brewers. Starbucks box of 54, Foldger, Pump Spice, newmans, Donut boxes of 80 were available at the entrance,and the coffee section, and thru out the stores. I purchase my first brewer and stock in 2004 and this is the first year that I notice large displays in every store. Full page ads in Kolhs and BBB, the Dunkin D near me cant keep the Kcups on the shelves and thats at $14.00 for box of 18.
Do not blame the stock price on management, I never once heard management trying to sell this stock using any type of media. There are alot of CEOs that go on certain TV shows trying to convince the puplic to buy thier stock, GMCR growth has been consistent even before the Kcup came out.
FYI while in Costco the person in front of me purchased 7 brewers, one for each of her children for Xmas and had another cart full of Kcups.
PS- I sold most of my shares a few months ago because even after two 3 for 1 splits and the insane stock price only a idiot would not lock in his profits. looking to buy more in the near future after seeing profit margin data.
Even the insiders had enough common sense to sell after watching the insane appreciation of their stock. if they did not sell I would not want them managing any company.
We are still in a reccession wait until the other 99% start buying brewers!
Xmas is going t be strong and this company is ready with their inventory. What I hate the most is ordering something an having to wait because they did not plan for the high volume.
We got winter and Xmas, two things on our favor - do not be stupid and sell, you will regret it even by mid morning this Friday and you will be feeling you are missing out on some gains.
Did you listen to the conference call? Did you try to find out before making baseless accusations?
Ok, I'll summarize for you. Coffee prices are up 65% since last year. So, if you had the same volume of inventory, the amount of the books would be up 65%. Now, how about factoring the increase in installed base of brewers and preparation for the strong winter season?
And the reason revenue declined vs q3 was that they implemented a price increase this quarter and customers pre-bought last quarter in anticipation of the price increase. So, don't bark with the crowd and do your own research.
False. Inventories are accounted on historical cost basis. 65% rise in price doesn't make the value of al inventories to go up, only the new purchases.
Gearing up for holiday doesnt explain it. You don't have to hold a whole quarter worth of inventories. Industry average is below 30 days. This is WAY out of nrm.