Company Update (NASDAQ:GMCR): Keurig Green Mountain Announces Repurchase of Shares Held by Lavazza

Keurig Green Mountain, Inc. (Keurig) (NASDAQ:GMCR), a leader in specialty coffee, coffee makers, teas and other beverages with its innovative brewing technology,¬†announced that on February 21, 2015 it entered into an agreement to repurchase approximately 5.2 million shares of Keurig common stock beneficially owned by Luigi Lavazza S.p.A. (“Lavazza”), at a purchase price of $119.18 per share. The purchase price represents a 3.0% discount off the closing price of Keurig common stock on February 20, 2015. The repurchase will be financed through cash balances and Keurig’s existing credit facility.

In connection with the entry into the stock repurchase agreement, Keurig also announced that it has entered into an amendment to its existing common stock purchase agreement with Lavazza dated August 10, 2010. The amendment eliminates Lavazza’s pre-emptive rights on future issuances of the Company’s common stock and will become effective as of the closing of the stock repurchase.

Shares of Green Mountain Coffee Roasters closed last Friday at $122.87 . GMCR has a 1-year high of $158.87 and a 1-year low of $90.08. The stock’s 50-day moving average is $126.07 and it’s 200-day moving average is $133.70.

On the ratings front, Green Mountain Coffee Roasters¬†has been the subject of a number of recent research reports. In a report issued on February 5, Goldman Sachs analyst Judy Hong maintained a Buy rating on GMCR, with a price target of $166, which represents a potential upside of 35.1% from where the stock is currently trading. Separately, on the same day, Canaccord Genuity’s Scott Van Winkle reiterated a Buy rating on the stock and has a price target of $139.

In total, one research analyst has rated the stock with a Sell rating, 5 research analysts have assigned a Hold rating and 5 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $122.87 which is 19.2% above where the stock closed last Friday.

Keurig Green Mountain Inc is engaged in the coffee and coffeemaker businesses in the United States and Canada. It sells Keurig Single Cup brewers and roast high-quality Arabica bean coffees.

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