Social Media Chatter Surrounding Green Mountain After Guidance Cut
This week, Social Market Analytics (SMA) revisits Green Mountain Coffee Roasters (NASDAQ: GMCR), a specialty coffee roaster and maker of the Keurig™ single-serve brewing system. In March, Green Mountain's social media signature indicated extreme negative sentiment ahead of reaction to an announcement by Starbucks of its intention to market a new single-serve brewing system. Green Mountain's stock has since experienced a sustained sell-off, but plunged an additional 48% on May 4 in reaction to reported Q2 results and reduced earnings guidance for 2012. During the week, SMA's metrics for GMCR provided early indication of continued negative price movement and the persistence of negative market sentiment for the stock.
On May 1, SMA's S-Score for GMCR entered a sharp downward trend from Positive to Negative territory. In the pre-market of market of May 2, GMCR's S-Score was -1.22 (Moderate Negative), and the stock closed the session down slightly at $49.52. The behavior of SMA's S-Score measures market trading sentiment and can provide actionable signals for upcoming price movement. In the pre-market of May 3, GMCR's S-Score moved dramatically lower to -4.17 (Extreme Negative), coincident with a 16-fold increase in its S-Volume metric indicating unusual, active social media content. The stock opened the May 3 session at $29.52 and continued to sell-off intra-day, closing at $25.87. On May 4, GMCR's S-Score eased, somewhat, to -2.30 but persisted at a High Negative level. GMCR ended the week at $25.10, a further decline of 2.98% for May 4, but down 49.5% net for the week.
Social Media data are noisy and complex. A single metric is insufficient to understand sentiment behavior over time. Our S-Factors are a family of metrics, including volatility, trend and volume measures, designed to provide a complete view of the social media signature for each security tracked in SMA's database. SMA's processing engine continuously updates our S-Factors, capturing overnight and pre-market sentiment activities. Clients receive sentiment reports prior to the U.S. market open and intra-day sentiment estimates for tracked stocks, on-demand. We invite the reader to visit our website; investigate our market sentiment metrics for GMCR, other stocks, industry sectors, and market indices; participate in our FAQ forum; and sign up for our Flash Report and Newsletter.
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