Green Mountain Coffee Roasters (GMCR) had a good run. In the first nine months of the year, GMCR rose from $34.45 a share on January 3 to close at $92.94 a share on September 30, but that was then.
David Einhorn’s Presentation Killed GMCR
Since the end of the third quarter, a lot has happened with GMCR. Since Greenlight Capital‘s David Einhorn criticized the company at the Value Investing Congress on October 17, GMCR’s shares have been sliding. Einhorn gave his presentation in the morning. By midday, the share price had fallen 11% (read about it here). Einhorn had explained, in a 110-slide presentation why he was shorting the company (see the presentation here). Afterwards, he explained to his investors in the quarterly letter (read it here) that much of his criticisms of the company were things that have happened over the last year. During the third quarter, Einhorn sold off roughly 400,000 GMCR shares, cutting his Greenlight Capital’s holding by around 42%.
Steve Cohen and Patrick McCormack were on the Same Page
Steve Cohen, the founder and manager of SAC Capital, seems to agree with Einhorn. In the third quarter, Cohen reduced his fund’s shares in the company from roughly 1 million at the end of the second quarter to 630,000 at the close of the third quarter. Tiger Consumer Management’s Patrick McCormack reduced his shares in GMCR to 450,000, down roughly 30% from the second quarter. John Thaler’s JAT Capital Management and Philippe Lafont‘s Coatue Management also trimmed their GMCR positions during the third quarter.