Case Study of Keurig Green Mountain
Keurig Green Mountain
Christian Derderian
Nick Fazzolari
Miguel Jimenez
Anastasia Zavgorodni
Table of Contents
I. Introduction
II. Industry Economic and Value Chain Analysis
A. Company Competitors
B. Value Chain Analysis
C. Firm’s Market Share
D. Industry-wide Technological Developments
E. Economic Analysis
F. Firm’s Business Strategy
III. Financial Analysis of the Firm
A. Assess Short-term Liquidity
B. Critique of Capital Structure and Long-term Solvency Issues
C. Firm’s Asset Utilization
D. Firm’s Operating Performance
E. Meaningful Ratios
IV. Executive Summary
A. Summary Interpretation
B. Z-Score
C. Conclusion
V. Appendix
A. Financial Statements
B. Common Size Statements
I. Introduction
Keurig Green Mountain, previously known as Green Mountain Coffee Roasters, is a coffee company founded in 1981 in Waitsfield, Vermont by Robert Stiller, who originally owned a local café. The coffee’s rich blends and aromatic tastes sparked much local interest and quickly generated a growing demand. Keurig Green Mountain is publicly traded on the NASDAQ Stock Market under the ticker symbol GMCR ($98.38 as of 4/17/2014).
In 2006 Keurig Green Mountain made a defining decision to acquire Keurig Inc., a company who manufactured single-cup beverages. The K-Cup structure was originally intended for coffee, but has since expanded into several beverage types including fruit juices, tea, iced tea and hot chocolate. This growing sector has been beneficial to Keurig Green Mountain because demand is growing and margins are high. Additionally, as the K-Cup System has become the industry standard, Keurig Green Mountain has been able to license the technology to otherwise coffee competitors such as Starbucks and Dunkin’ Donuts. This technology allows the much smaller Keurig Green Mountain to stay competitive with industry goliaths like Starbucks and Dunkin’ Donuts, even though Keurig Green Mountain has far fewer retail outlets.
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Christian Derderian
Nick Fazzolari
Miguel Jimenez
Anastasia Zavgorodni
Table of Contents
I. Introduction
II. Industry Economic and Value Chain Analysis
A. Company Competitors
B. Value Chain Analysis
C. Firm’s Market Share
D. Industry-wide Technological Developments
E. Economic Analysis
F. Firm’s Business Strategy
III. Financial Analysis of the Firm
A. Assess Short-term Liquidity
B. Critique of Capital Structure and Long-term Solvency Issues
C. Firm’s Asset Utilization
D. Firm’s Operating Performance
E. Meaningful Ratios
IV. Executive Summary
A. Summary Interpretation
B. Z-Score
C. Conclusion
V. Appendix
A. Financial Statements
B. Common Size Statements
I. Introduction
Keurig Green Mountain, previously known as Green Mountain Coffee Roasters, is a coffee company founded in 1981 in Waitsfield, Vermont by Robert Stiller, who originally owned a local café. The coffee’s rich blends and aromatic tastes sparked much local interest and quickly generated a growing demand. Keurig Green Mountain is publicly traded on the NASDAQ Stock Market under the ticker symbol GMCR ($98.38 as of 4/17/2014).
In 2006 Keurig Green Mountain made a defining decision to acquire Keurig Inc., a company who manufactured single-cup beverages. The K-Cup structure was originally intended for coffee, but has since expanded into several beverage types including fruit juices, tea, iced tea and hot chocolate. This growing sector has been beneficial to Keurig Green Mountain because demand is growing and margins are high. Additionally, as the K-Cup System has become the industry standard, Keurig Green Mountain has been able to license the technology to otherwise coffee competitors such as Starbucks and Dunkin’ Donuts. This technology allows the much smaller Keurig Green Mountain to stay competitive with industry goliaths like Starbucks and Dunkin’ Donuts, even though Keurig Green Mountain has far fewer retail outlets.
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