Based on the aggregated intelligence of 165,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, specialty coffee company Green Mountain Coffee Roasters (Nasdaq: GMCR) has received the dreaded one-star ranking.

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

Green Mountain facts

Headquarters (Founded)

Waterbury, Vt. (1981)

Market Cap

$4.2 billion


Packaged foods

Trailing-12-Month Revenue

$1.2 billion


CEO Lawrence Blanford (since 2007)

CFO Frances Rathke (since 2003)

Return on Equity (Average, Past 3 Years)



$9.0 million / $274.0 million

Price-to-Earnings (GMCR and S&P 500)

61.8 and 13.7

1-Year Return



Starbucks (Nasdaq: SBUX)

Sara Lee (NYSE: SLE)

Peet's Coffee & Tea

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 36% of the 306 All-Star members who have rated Green Mountain believe the stock will underperform the S&P 500 going forward. These bears include Motley Fool Hidden Gems co-advisor Seth Jayson (TMFBent) and TMFDeej, both of whom are ranked in the top 1% of our community.

A few months ago, Seth encouraged Fools to look past Green Mountain's soaring sales: "Wow, folks sure seem impressed by topline growth. My look at earnings of various types finds, well, not much. All the revenue growth in the world isn't going to help if [Green Mountain] ain't making much dough for shareholders."

Despite whopping sales growth, Green Mountain has habitually posted negative to low single-digit cash king margins over the past decade. In fact, Green Mountain's lack of cash generation, coupled with a soaring stock price, has it currently trading at a stiff price-to-operating cash flow of over 100. For perspective, rivals Starbucks, Sara Lee, and Peet's sport price-to-cash flow ratios ranging from the low to mid-teens. While a few Wall Street analysts have listed Green Mountain as the perfect takeover target for food giants hankering to get into the specialty coffee game, including Coca-Cola (NYSE: KO), Kraft (NYSE: KFT), and PepsiCo (NYSE: PEP), it's tough to imagine a substantially higher offer than today's already super-rich price.

CAPS All-Star TMFDeej sums up the bear case:

As I search for a few select shorts to hedge my mostly long CAPS portfolio, [Green Mountain] seems to fit the bill. I use a Keurig at the office and it's not bad, but I don't think that the company will experience the rapid profit growth that Mr. Market currently seems to be pricing in. One major headwind that Green Mountain faces is a huge increase in the price of coffee beans, which according to Barron's account for nearly a quarter of the Company's cost of goods sold. Coffee bean prices recently hit a twelve-year high. ...

In this sort of economic environment, it's easy to see consumers being hesitant to pony up a premium price for the convenience of Green Mountain's coffee products, when the good old coffee pot will do the trick at a fraction of the price.

What do you think about Green Mountain Coffee Roasters, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Coca-Cola is a Motley Fool Inside Value choice. Green Mountain Coffee Roasters is a Motley Fool Rule Breakers selection. Starbucks is a Motley Fool Stock Advisor recommendation. Coca-Cola and PepsiCo are Motley Fool Income Investor recommendations. Motley Fool Options has recommended a diagonal call position on PepsiCo. The Fool owns shares of Coca-Cola. Try any of our Foolish newsletter services free for 30 days.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Fool's disclosure policy always gets a perfect score.