Yahoo needs to update the financials and show the actual P/E ratio. JVA has had the best earnings since 2009 (and this is based on only 3 quarters) and is trading as if they are losing a fortune. The trading is very broken here, way too much upside here to continue ignoring this company. $5.50 is an absolute steal.
According to this computer-generated chart, today was the bottom for a while and it will head back up. It's been right since March, just posting it for curiosity's sake. This selloff is absurd.
Whenever something becomes so obvious that it has to happen, Wall Street will rip your heart out and do the complete opposite. Oil HAD to keep falling and small caps (IWM) HAD to crash. That's why they both did the opposite today.
I am not a reason to buy or sell this stock. This is pretty much insanity right now. If you compare the stock price to last year when it was the same price and compare the fundamentals, well, something is seriously wrong somewhere.
I'm sure short interest has risen dramatically since the last update and that's what is causing this latest selloff. JVA should not only complete the buyback but announce another one. If they thought this was cheap enough at $6.50 to buy back their own shares, they should raise debt to buy back a lot more at $5.40. Fire the bullets when it makes sense.
Not specific to JVA but the market looks pretty horrific right now. I won't talk about conspiracy theory but the market has been tanking the past few days and today the Iraqi Prime Minister told REPORTERS that ISIS was planning to attack New York City and Paris subway systems. Of course the fear index is rising significantly off that news. The markets will probably continue to sell off, perhaps hard, in at least the next few days or weeks. While that has nothing to do with coffee sales, JVA may be hard pressed to stage a significant rally while the markets sort out the problems with a soaring US dollar, falling small caps and now the ISIS terror threat being made public which is questionable at best but still going to impact markets.
If JVA's 20% decline in sales the past 2 quarters rebounds to what it was, and they remain profitable as they have been, this instantly goes back to $8. It will be cheap even then because of the low P/E which will get even lower after next quarter's earnings. Not to mention the PR value from the licensing deals they are getting from 6 new coffee shops opening in China in the next few months.
Sounds like it is strictly a licensing deal. JVA receives a percentage of sales of any products sold with the "Don Manuel" label by DTS8 in these Chinese gourmet coffee shops. One store in China was to be built in September and 5 more are planned for the first quarter 2015. It will not generate a lot of revenue initially, this is more of a future growth story and depends on how many stores ultimately will be built.
Spiked at the end of September 2013 into the first week of October when it peaked. Looks like a repeat performance. I expect VXX to keep climbing for another week or two before the markets stage another rally. For the next 2 weeks, VXX is the investment to own.
GMCR is still buying coffee from JVA of course, if they weren't, their sales would fall dramatically. They have definitely cut back on their purchases as JVA used to get 60% of their sales from GMCR and now it's 52%. The question is whether GMCR is cutting back on buying across the board to ride out the higher prices or if this is permanent. In the meantime, coffee prices are soaring again which will turn into another nice hedging gain for Q4 and a P/E ratio dropping to around 7.
This price drop is ridiculous but JVA is caught in the downdraft of the entire stock market being repriced due to looming interest rate hikes in about 8 months. Of course, none of that will have any effect on JVA's business, people will buy coffee whether the interest rates are 0.5% or 2%. Of course this selloff is ridiculous and JVA will shoot up when the markets normalize and Q4 approaches.
"Coffee watcher ICO estimates a 10M production bag deficit could result due to the weak crop amid an environment of rising global demand."
ICO said it expects global coffee shortages for the 2014/15 and 2015/16 seasons.
Despite the musings of one short-seller, higher coffee prices result in higher margins and hedging gains for JVA. An actual coffee shortage would send coffee prices to $3 and beyond. If it gets as bad as they are predicting, who knows, it may even reach $4. It won't take much to make this stock go parabolic again, earnings have been excellent but earnings could easily double or triple if coffee prices go that high.
It has helped their bottom line. JVA has reported better earnings in only 3 quarters this year than they have for an entire 4 quarters at any time since at least 2009. Given that, I would say that high coffee prices DO help. Their cost of sales is significantly improved this year as a result of higher prices and improved margins. Their inventory as of last quarter was $12 million in green coffee. This value would rise considerably with coffee over $3.
I would say that if coffee prices remain above $2 for the rest of the quarter, the likelihood of JVA reporting a nice profit in Q4 increases. I know what you're saying about sales but GMCR still accounts for over half their business so it's not like they stopped buying. They may have curtailed buying to ride out the higher prices and that was national news a few months ago that both GMCR and SBUX would do that.
Consider this. First, demand for coffee is growing in places like China, India and Brazil. Next, the prediction for coffee beans in Brazil is even worse for next year. So places like Starbucks and Green Mountain maintain an inventory of about a year's worth of coffee. They may be drawing down inventory to some extent and those levels will need to be brought back to normal eventually. If there's a coffee shortage in 2015, they won't be able to replenish their inventories without having to pay higher prices.
Coffee is a highly volatile commodity anyway. The perception that there may be a coffee shortage of about 10 million bags along with increased consumption in very populus markets, that could fuel a surge in coffee prices unlike anything seen before. Perception will become reality.
Wrong. I have followed FPP since 2005. Starting in May, the price was being heavily manipulated and I pointed it out on these boards. Oil prices were still going up. The stock market was still going up. Other oil stocks were still going up.
Would FPP have fallen without the price manipulation? Undoubtedly yes. But not to this extent and now without the price recovering at some point. I compared FPP's stock performance to dozens of others and FPP has fallen far more than any other oil company....even those companies without any sales at all have done far better.
FPP will not be allowed to go meaningfully higher until the stock specialist and whoever he's working with get their payday. Remember, I started complaining about the stock price manipulation about a month before oil prices started falling. This is being manipulated and engineered to put a lot of money in somebody's pocket. I have seen it once before and it resulted in a company buyout saving the buyer at least $10 million due to a lower price.
The SEC doesn't deal with price manipulation unless it's being done by insiders. FINRA seems to deal with matters like this. This issue is already being looked at. In my life, I have seen this type of manipulation only twice. The first time, the company was bought out 6 months after I reported it happening to the CEO. I told the CEO that the manipulation I was seeing had only one logical explanation. Somebody wanted to buy the company and was driving down the stock price significantly to save millions of dollars. What I didn't know was that 6 months before that, the CEO told private equity firms they were for sale for the right price but that was not public knowledge. Everyone that believed I was wrong, people like you for instance, thanked me mightily once the takeover was announced publicly even though it was for a lot less money than the company was worth. The private equity firm that eventually bought out the company had spent a lot of money forcing the stock price lower and saved many. many times their investment buying out the company about 30% lower than it should have been sold for. Now I am seeing the same exact thing with FPP. What they have been doing since May is placing limit sell orders lower than the current price. Meaning, market buy orders cause the stock to go down. This has happened EVERY SINGLE DAY SINCE MAY 2014.
I am not like most people. I don't claim manipulation when the stock price falls. Check my posts. I started complaining about price manipulation with FPP in May and it proceeded to make a 52-week high a couple of weeks later before the plunge into the abyss began. As I said before, I have followed FPP since 2005 and ridden the stock through many ups and downs. But it was only in May 2014 that everything changed and I noticed the stock was being attacked. So far, I am one for one in noticing this and correctly identifying why the manipulation is happening. I'm pretty sure I will be 2 for 2 when this resolves itself
Watch how this happens. The current price is $3.77. Immediately the asking price has been dropped to $3.74 even though the price is still $3.77. If you are online when I write this, check out the bid/ask/price immediately and you will see exactly what type of manipulation is happening.
FPP: Bid 3.58 Ask 3.74 Last 3.77
Oops, they just dropped the ask to $3.72!! Price is still 3.77. MANIPULATION!
Now the ask is $3.69, current price $3.77. Why would somebody purposely place a trade to lose money? Answer: To drive the price down.
Look at the quotes. The asking price is $3.69 even though the current price is $3.77. Now they dropped it to $3.68. You are not listening to what I am telling you. THIS is what has been happening every single day since May. This is not a one time occurrence. Somebody is systematically placing limit sell orders lower than the current price. Look at the quotes and imagine that happening every day for months. IT IS BLATANT PRICE MANIPULATION and it's right there in front of you.