Why Keurig Green Mountain Inc Stock Shot Up Today

Is this meaningful? Or just another movement?

May 13, 2014 at 2:06PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Keurig Green Mountain Inc (NASDAQ:GMCR) were bubbling higher today, gaining as much as 12% after Coca-Cola (NYSE:KO) stepped up its investment in the single-cup coffee brewer.

So what: Coke said that it planned to increase its stake in Keurig from 10% to 16%, explaining, "These incremental purchases demonstrate our continued belief that Keurig Green Mountain has substantial growth potential." The announcement follows a February deal between the two companies in which Coke agreed to share its beverage portfolio with Keurig for the new Keurig Cold brewing system, and took a 10% stake in the K-Cup maker. The move will make Coke Keurig's largest shareholder and, unlike the 10% stake it acquired earlier, will not dilute shareholders further, as Coke plans to buy shares on the open market with the help of Credit Suisse.

Now what: The move clearly strengthens the relationship the two companies had outlined back in February, and is a boon to Keurig shareholders, as Coke's purchases should drive up the share price. Due out in fiscal year 2015, the Keurig Cold machine represents an opportunity for Coke to extend its brand reach at a time traditional soda sales are falling in the U.S. For Green Mountain, partnering with the world's largest beverage company could make the new brewing system a blockbuster product. Investors are clearly hoping so, as Keurig shares shot up 40% when the first deal was announced.

Keurig Green Mountain was a multibagger. Will this stock be your next one?
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Jeremy Bowman has no position in any stocks mentioned. The Motley Fool recommends Coca-Cola and Keurig Green Mountain. The Motley Fool has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. 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.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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.

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