Summary

• Key concerns pointed toward breakdown of share price.
• Numerous analysts have talked down the expectations and ratings of the stock recently.
• Keurig Choice is a new initiative that needs clarification for investors.

Keurig Green Mountain (NASDAQ:GMCR ) shares continued their steady decline in Friday’s trade as the stock battles through a series of analysts’ coverage notes. In a recent article I authored, Current Concerns Surrounding Keurig Green Mountain. I detailed my main concerns I had for shares of GMCR and the business. The following bullet points will serve to reiterate these concerns I highlighted previously:

• Trading channel well defined since Q4 2014 earnings release. High point of this channel was $157.10 and the low point of the channel, which has held support recently, was $127.19. Our concern, naturally, is any near term break of the $127.19 price with a close below that support level. Yesterday, the $127.19 level was breached. Friday, shares plunged below this level as the stock fell sharply at the open.

• Bank of Canada rate cut affects net sales for GMCR: The Bank of Canada acted in a surprising fashion by cutting its key interest rate. Naturally, this sent the U.S. dollar rocketing higher against the Canadian dollar. Given past precedence in which Keurig Green Mountain has identified the currency exchange affects on sales and profitability in its Canadian business segment, such a sudden strengthening in the USD against the CAD may foreshadow a greater headwind for the company than in previous years.

• Brewer net price realization declined 10 percentage points during Q4 2014 due to the company’s decision to drive brewer volume and invest some of the favorable commodity cost early in the year to further expand the installed base. With regards to net price realization, Capital Ladder Advisory Group believes this issue may proliferate unfavorably going forward for Keurig Green Mountain and as the company more broadly saturates the U.S. marketplace.

• Key GMCR shareholder and partner, Luigi Lavazza. has been liquidating shares.

• Sales growth is decelerating at a more rapid rate than in previous quarters and/or years. Recent Nielsen data shows that sales of the company’s K-Cup coffee pods have experienced significant growth deceleration. An analyst from the research firm SunTrust Robinson Humphrey is concerned, calling the slowest growth in recent memory.

These concerns, and especially the selling pressure produced by Luigi Lavazza, has resulted in shares of GMCR breaking through its 200 day moving average on Friday. The stock exhibited a low, intra-day share price of $121.40 before rebounding somewhat during the trading day. I utilized the level below $123 to cover my short position and take the trade off the table. In the time period between the Q4 2014 earnings release date and today, shares of GMCR have broken below a pivotal level ($136) on my heavily relied upon Point & Figure chart numerous times. I had articulated this point of concern as early as January 7, 2014 in an article titled Keurig Green Mountain And Dr. Pepper Snapple Group Extend Their Partnership As K-Cup Sales Decelerate .

As far as shares of GMCR are concerned and as recognized previously, since Keurig Green Mountain released its FY15 guidance, shares have been under consistent pressure. As a subscriber to Dorsey Wright Point & Figure technical analysis (subscription necessary), when shares of GMCR hit $136 back in December of 2014, a clear sell signal was recognized in the Point & Figure chart. Shares have performed in recognition of this sell signal since this time period only to see its lowest levels since August of 2014. It remains to be seen if shares of GMCR can regain their momentum and today’s partnership announcement may be just the thing to get the stock going in the right direction.

Unfortunately, shares have not been impacted positively by what could be viewed as positive news, with consideration given toward their extended partnership with Dr. Pepper Snapple Group (NYSE:DPS ). It remains to be seen as to what can propel shares higher from the current price.

In a more recent development, CLSA initiated coverage on Keurig Green Mountain with an Underperform rating and a $130 price target objective. This analyst activity comes on the heels of a recent Hold reiteration by Credit Suisse’s Mark Astrachan. but with reduced growth estimates from the analyst and a downgrade from boutique firm Consumer Edge Research.

There is one more thing that I have yet to fully digest with regards to Keurig Green Mountain. I have recently contacted the company regarding its latest business development, which is called Keurig Choice.

Many Keurig users and fans recently received e-mail notification of a newly instituted purchase program idyllically named Keurig Choice. Essentially, the program allows a consumer to rent-to-own a Keurig brewer over a period of 36 months for as low as $5.99 a month as indicated in the photograph below. I can’t say as I have ever seen such a program by a small appliance company in the past and for a price point of a brewer system at less than $200. Before I rush to draw conclusions on this developing business segment for Keurig Green Mountain, I’ll await a response from the company. At first glance, however, some may be of the opinion that such a differing business operation as the Keurig Choice program would certainly be, offers a read into the current state of affairs at Keurig Green Mountain. We may hear more about this program in the coming days as the company is set to report earnings on February 4th after the closing bell.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More. ) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.