Green Mountain Coffee Roasters Inc., the seller of Keurig single-cup brewers, rose the most in a month in U.S. trading on speculation the company may be a target of Nestle SA, the world’s largest food company.
Green Mountain climbed $1.94, or 7.2 percent, to $28.81 at 4:30 p.m. New York time on the Nasdaq Stock Market. The shares have dropped 23 percent since Sept. 27, the day before the U.S. Securities and Exchange Commission said it was investigating accounting errors at the company.
Speculation that Nestle would begin a takeover bid for Green Mountain has also moved the stock in the past, Scott Van Winkle, an analyst in Boston with Canaccord Genuity Inc., said in a telephone interview.
“Nestle has had enormous success with automated espresso in Europe and they can’t replicate that in the U.S.,” said Van Winkle, who has a $40 price target for Green Mountain. “Keurig is to the U.S. what espresso is to Europe.”
Green Mountain last month said it was buying Van Houtte Inc., Canada’s largest coffee roaster, for about C$915 million ($905 million) to expand its Keurig business in Canada. Keurig accounted for more than half of Green Mountain’s sales last year.
Suzanne DuLong, a spokeswoman for Green Mountain, declined to comment on the stock movement or takeover speculation.