JAT Capital’s John Thaler made a well-timed investment in Green Mountain Coffee back in December.
The ~35-year old hedge fund manager, who set out on his own in 2007 after he worked as a portfolio manager for Chris Shumway‘s Shumway Capital*, filed a 13G report with the SEC on December 16th that showed a 5% ownership stake in Green Mountain.
The fund filed that it owned 6,602,008 shares, a 128% increase in their position size as JAT held only 2,890,042 shares at the end of the third quarter, according to Market Folly.
13G filings have to be reported within 10 days of an investment, so let’s suppose Thaler bought Green Mountain on the dip on December 6th, at $35.15, and sold everything at the peak on Februaury 14th $46.35.
Of course, it’s not that simple, but he would have cashed out a ~$300 million stake and made at least a $40 million profit off the ~4 million shares he just bought.
Check it out:
Green Mountain surged recently on speculation that both Dunkin doughnuts and Starbucks would announce deals that would allow Green Mountain to sell the two brand name’s coffees in their K-cups. Today, only private-equity owned Dunkin doughnuts announced a deal.
So let’s hope Thaler’s been selling, because for the last two weeks, Green Mountain has been down and today, it is down again, trading at $41.
Thaler can still make about $20 million even if he sells now. But now the stock is has been getting hurt because of speculation that Starbucks will simply make its own version of Green Mountain’s Keurig single-cup coffee brewers.
So if Thaler still owns Green Mountain when (if) Starbucks announces that it’s manufacturing its own K-cup brewers for Starbucks-brand K-cups, Thaler could get crushed.
The good news: the Dunkin deal could also mean a deal with Starbucks will follow for Green Mountain. The Green Mountain CEO wouldn’t comment on what it means for Starbucks.
And in unrelated bad news for Thaler: his fund was recently ensnared in the insider trading investigation.
*Sidenote: Thaler joined the eventually huge fund before it launched.
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