Admit it, if you're an American who identifies with the statistic stating Americans consume an average 3.1 cups of 9 oz. of coffee per day, then you probably know deep down what kind of toll the habit takes on a wallet.
In fact, according to a new survey by Accounting Principals, more than half of American workers buy coffee regularly while at work and spend an average of $1,000 a year. If you're a coffee junkie, you probably aren't surprised, unless you think it should be higher.
The survey also found that young adults (aged 18 to 34) drink more coffee than workers over the age of 45. Furthermore, men spend more on coffee than woman.
Trading the Trend
As I sit here, sipping on my second over-priced coffee of the day, I understand this will probably be a habit of a lifetime. This tells me that demand can only grow higher as the population ages and a fresh batch of coffeeholics enter the workforce.
"Sure, you can make your own coffee at home (and save 90%)," says Farnoosh Torabi of MarketWatch, "but it's not as fun as waiting in line at Starbucks... It's also difficult to break the habit when so many restaurants and fast-food joints are brewing up a coffee storm, with chains adding various coffee varieties to their menus and touting their selection of hot beverages more aggressively."
Indeed, the coffee industry is benefiting from its increased presence in food establishments from the obvious locations like diners, Dunkin' Donuts and McDonalds to more surprising ones like Taco Bell.
Interactive Chart: Press Play to compare changes in market cap over the last two years for the stocks mentioned below.
Business Section: Investing Ideas
Coffee prices have gone up 410% since early 2002. Coffee stocks have also shown impressive growth in recent years despite the economic slowdown and market volatility.
In light of all the coffee-facts mentioned above, we list below 5 major coffee stocks that have seen very significant levels of growth in the last year.
Do you think these stocks have more growth to cash in? (Click here to access free, interactive tools to analyze these ideas.)
1. Caribou Coffee Company, Inc. (Nasdaq: CBOU): Operates coffeehouses primarily in the United States. Market cap of $342.40M. In the past year the company's value has grown 65.46%. The stock is a short squeeze candidate, with a short float at 9.73% (equivalent to 7.54 days of average volume). Exhibiting strong upside momentum--currently trading 13.88% above its SMA20, 21.61% above its SMA50, and 32.06% above its SMA200. The stock has had a couple of great days, gaining 7.04% over the last week.
2. Dunkin' Brands Group, Inc. (Nasdaq: DNKN): Operates, and franchises quick service restaurants worldwide. Market cap of $3.21B. DNKN was brought to the public market in July and has since grown 45.42%.
3. Green Mountain Coffee Roasters Inc. (Nasdaq: GMCR): Engages in the specialty coffee and coffee maker business. Market cap of $7.82B. In the past year the company's value has grown 43.87%. The stock has had a good month, gaining 11.7%.
4. Coffee Holding Co.Inc. (NYSE: JVA): Engages in manufacturing, roasting, packaging, marketing, and distributing roasted and blended coffees in the United States and Canada. Market cap of $51.69M. In the past year the company's value has grown 137.95%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.3). It's been a rough couple of days for the stock, losing 8.84% over the last week. The stock has had a good month, gaining 22.59%.
5. Peet's Coffee & Tea, Inc. (Nasdaq: PEET): Operates as a specialty coffee roaster and marketer of fresh roasted whole bean coffee and tea in the United States. Market cap of $762.09M. In the past year the company's value has grown 51.99%. Relatively low correlation to the market (beta = 0.75), which may be appealing to risk averse investors. The stock is a short squeeze candidate, with a short float at 17.62% (equivalent to 16.66 days of average volume). The stock has gained 51.99% over the last year.
6. Starbucks Corporation (Nasdaq: SBUX): Operates approximately 16,858 stores, including 8,833 company-operated stores and 8,025 licensed stores. Market cap of $35.52B. In the past year the company's value has grown 44.44%. The stock has gained 44.44% over the last year.
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Disclosure: Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Data sourced from Finviz.