David Einhorn Green Mountain Coffee Roasters

Einhorn Green Mountain Coffee Roasters

Einhorn's Words on Green Mountain Coffee Sends Shares Down

After his hedge fund's impressive performance streak, David Einhorn is probably known best for his sharp public criticisms of firms that he sees as being poorly managed, having an inflated value, using questionable accounting practices and for having other weaknesses.

Perhaps most notably, Einhorn publicly questioned both Lehman Brothers and Allied Capital, arguably contributing to their downfall (while Einhorn's Greenlight Capital made a killing by shorting both firms).  Now, he has a new target to short: Green Mountain Coffee Roasters (GMCR).  According to Bloomberg, Einhorn said of Green Mountain Coffee Roasters: "[The company has a] litany of accounting questions,” and he called earnings “perhaps too good to be true.”  This has led shares to tumble despite impressive growth this year.
Speaking during the Value Investing Congress in New York, Einhorn said the company has a “looming patent issue” on its single-serve K cups, a “litany of accounting questions,” and recent earnings that are “perhaps too good to be true,” reports Bloomberg. 
Einhorn, whose Greenlight Capital is known for its activism, also said the company needed to improve its disclosure, revealing that Green Mountain had refused to speak to him while citing a quiet period. 
Green Mountain shares fell 9.8% to $83.07 at 12:23 p.m. in New York, after earlier dropping to $81.61. But that said, shares are still up 137% since the start of the year. 
Green Mountain's per-share earnings have been in the triple digits in the last two quarters and analyts expect similar growth in Q4. Source

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