As some of you are aware, rumors sparked a huge jump in GMCR. The rumor: that starbucks would be buying a 30% stake in the company. To me, this is a joke. SBUX already has a partnership with GMCR. GMCR’s patents are apparently expiring in 2012. The company is heavily shorted (a red flag), but even more alarming are the caliber of the shorts, primarily David Einhorn. The company is also under investigation by the SEC. So what motivation would Starbucks have here? They could always go through with the announcement and put in some clause along the lines of “subject to SEC investigation results” or whatever that official language would be. However, I just don’t see a good reason for this move. Not to mention the fact that there hasn’t been a press release as of yet.

Einhorn’s presentation: http://cache.dealbreaker.com/uploads/2011/10/Greenlight-Capital-VIC-2011-Presentation-GMCR.pdf

VIA my last post, I reshorted GMCR via puts about an hour before this announcement, so I’m not exactly happy. However, I added while the stock was running. The stock hit 66.95 at the high’s and is now back under 65. I’ll be monitoring it closely to see if how it’s interacting with the 20day on the hourly chart.

I have also began positions in GOOG and CIEN.

I will probably also buy some SCO at the end of the day.

NOTE: I also bought some NFLX, following Le Fly.

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