Green Mountain Coffee Roasters (Nasdaq: GMCR) recently posted robust revenue and earnings growth in its fourth quarter. However, investors had higher expectations, and reacted by eroding one-third of the stock's value in response. This comes at a time when hedge fund manager David Einhorn has damaged the company's image.

Will relationships with fellow brewers Starbucks (Nasdaq: SBUX), Dunkin' Brands (Nasdaq: DNKN) and Caribou Coffee (Nasdaq: CBOU) be enough to carry them forward?

Let's see what's troubling the company.

A rocky quarter
Green Mountain's profits during the quarter increased to $75.4 million, which is nearly triple compared to the previous year. This was mainly caused by robust K-cup growth, which accounted for nearly two-third of the company's revenue. Earnings per share of $0.47 missed analyst expectations by just $0.01. However, this was not the reason for investor concern.

The company earned revenue of $711.9 million in this quarter, a staggering 91% increase from the year-ago period, but that failed to meet the average expectation of $760 million. Green Mountain has been surprising the market and beating revenue estimates for over two years now. So, what has led to this drop?

Blame it on the change
Management feels that there has been a change in the ordering pattern of wholesale customers. Apparently, wholesalers bought too much from the company in the last quarter and balanced that out by purchasing less in this quarter. In other words, wholesalers over-ordered earlier, which led to low revenue growth in this quarter.

Hedge fund manager David Einhorn, however, highlighted that Green Mountain's inventory levels and capital expenditure trends are responsible for a severe weakness in the company. He pointed out that inventories, which are up 356% compared to last year, are growing faster than the company's sales.

Additionally, the company's increasing capital expenditure is a concern. Green Mountain spent extensively on K-Cup and next generation K-Cup coffee packaging, thereby doubling its capital spending to $290 million in fiscal year 2011. It plans to spend an additional $700 million in the next fiscal year. The rise in capital expenditure far exceeds the estimated growth of the company.

Foolish final thought
Dark clouds are looming over the coffee giant. But there are some positives to look forward to as Green Mountain has projected sales growth for the next fiscal year at 60%-65%. Stay updated about Green Mountain to see if the company gets roasted or manages to brew strong results by adding it to your Watchlist. It's free. Click here.

Fool contributor Navjot Kaur does not own shares in any of the companies mentioned in this article. The Motley Fool owns shares of Starbucks. Motley Fool newsletter services have recommended buying shares of Starbucks and Green Mountain Coffee Roasters. Motley Fool newsletter services have also recommended creating a lurking gator position in Green Mountain Coffee Roasters. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.