Carribou Coffee (ticker: CBOU); 18% sales growth, but poor earnings. What's your take?

Question

They recently annoucned an 18% sales growth, an energy drink partnership with Coke, new management and entry into the Asian markets. Historically earnings have been terrible.

When is it time to buy? Should I wait for the earnings reports?

http://finance.google.com/finance?q=cbou

Answer 1

Let's see, it has a decent balance sheet. Some debt, but not oppressive. Current liabilities is smaller than current assets. That capital surplus looks delicious. While the income shows a deficit, part of that is a generous depreciation and a noticeable chunk of capital expenditures so we have an expansion of capacity and a possible accelerated depreciation which is done so that future earnings will look better. Um, future earnings, so if you are going to buy it, the price might not get an awful lot cheaper. It's not on my short list, but it won't hurt for anyone else to have it on their consideration list. I know for a fact that you could do worse. Good luck.