(AP) — Green Mountain Coffee Roasters Inc. shares surged Thursday after the company reported a better-than-expected quarter, announced a $1 billion share repurchase program and initiated a regular dividend.
The Waterbury, Vt.-based company makes single-serve brewing machines that have gained popularity in recent years.
Despite some concerns about competition and slowing demand for the company's products, Green Mountain reported late Wednesday that it sold 2.6 million machines, up from 2 million in the previous quarter. Its portion-pack revenue rose 23 percent from a year ago, as stronger volume was somewhat offset by lower prices.
Green Mountain earned 89 cents per share on an adjusted basis for the fiscal fourth quarter on revenue of $1.05 billion, topping the75 cents per share on revenue of $964.6 million that analysts polled by FactSet had forecast. The company forecast adjusted earnings for the year between $3.75 and $3.85 per share; analysts had forecast $3.78 per share.
KeyBanc Capital Markets analyst Akshay Jagdale reiterated a "Buy" rating on the company's stock and a $100 price target following the report.
The analyst said in a research note that the quarter was significantly better than expected, especially on sales. He said it was Green Mountain's most impressive sales growth performance in at least seven quarters, which is encouraging in light of concerns over competition. The analyst believes the company's forecast for the year is conservative but prudent.
Shares of Green Mountain jumped more than 17 percent to $72.57 by midday. Its stock has gained 75 percent for 2013.