Why Cott is Poised to Underperform

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, beverage producer Cott (NYSE: COT  ) has received an alarming one-star ranking.

With that in mind, let's take a closer look at Cott and see what CAPS investors are saying about the stock right now.

Cott facts

   

Headquarters (founded)

Mississauga, Canada (1955)

Market Cap

$777.6 million

Industry

Soft drinks

Trailing-12-Month Revenue

$2.3 billion

Management

CEO Jerry Fowden

CFO Jay Wells

Return on Equity (average, past 3 years)

10.5%

Cash/Debt

$88.1 million / $603.9 million

Dividend Yield

2.9%

Competitors

Coca-Cola (NYSE: KO  )

Dr Pepper Snapple Group (NYSE: DPS  )

PepsiCo (NYSE: PEP  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 39% of the 267 members who have rated Cott believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, samhorn31, succinctly summed up the Cott bear case for our community:

With margins getting beat up by increase price of material costs ie Aluminum and Sweetners, it will be hard for [Cott] to cut those costs. [Insider selling] is never a good sign. Cott also has a high level of debt but they do suggest a good paydown schedule.

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