Ten Peaks Coffee Co (TPK-T)

A de-caffeinated coffee company which is growing faster than the caffeinated coffee market. Driven by health trends. Over the last years they've been building a new production facility which will open up their capacity, so the company will grow. They're gaining market share and launching a sales force in Europe. They're setting themselves up for growth. Cheap shares, nice 4% yield. May have to be patient until the facility opens in Q3 2019.

(A Top Pick Jun. 26/17, Down 2%) One of his larger holdings. Decaffeinate without using the paint remover chemical. Big clients are Tim Horton's, McDonalds and others. They are building a new plant.

This used to be an income trust. It’s not a very fast-growing business because coffee is a mature industry. The yield is under 4%, which is unattractive on a slow-growth company.

He owns 8% of the company. The company has never been doing better and the stock has never been cheaper. This is the only company in the world that does chemical-free decaffeination in large volume. One of a competing company’s plants closed in Europe and that is driving new volume to TPK. His customers are Tim Hortons, McDonald’s Canada, and several importers. The company has great margins. He’s convinced the stock will go up quite a bit by next year.

He owns 8% of the company. You have zero analyst coverage. They are the only ones in the world to do this chemical free decaffeination process. You are going to see some good volume improvement going forward. You may see some analysts starting to cover it. They need to beef up their investor relations. They have good margins and good cash flow. It has international growth potential also. It is not an expensive stock.

A coffee decaffeinater and distributor. There is a lot to like about this company. Has a pretty strong balance sheet and pays about a 4% dividend, which look sustainable. Coffee prices are falling, which means you have higher volumes and higher purchases from distributors. They’re building a new plant expansion, which won't be finished for another 1.5 years. As an investor, you’ll probably have to wait 1.5 years for things to ramp up, so you’ll have to be patient. There isn't any catalyst right now for the next leg of growth.

(Market Call Minute) He owns about 8% of the company. They had good volume growth in the last quarter. They are building a new plant which is coming on stream in the next year.

A great little company. Volumes have been growing steadily for the last few years. Huge barriers to entry. Great margins and cash flow. They are building a new plant because of expected further huge growth in volumes.

Unusual in that it has almost the only non-chemical decaffeination process. It needs to be acquired by someone who wants the decaffeination process. It is not dynamic and is not going to do anything gigantic. You have to be aware that in coffee there can always be a year that goes wrong.

The only one with a chemical free decaffeination process – the Swiss water method. They are spreading it throughout the world as the chemical process is being banned in more and more countries. He owns about 7.5% of the company as he accumulates it.

7 years ago a major insider was staying clear. If it came down a ways from this level it could get back on his stock watch list.

This does green coffee decaffeination. They have some big customers such as Tim Hortons, so there are some concentration risks being at the mercy of these companies. The real story is the plant expansions they are doing. In mid to late 2018, they are essentially building a new facility to help the company grow a bit more. The problem is that investors are kind of stuck waiting for 1-1.5 years for something to really happen. The dividend is nice. Half market cap is in cash. A situation where the management needs to step up and throw the investors a bone to keep them interested for the next year. Not a bad name, but you could revisit this in 6-9 months and are maybe not going to miss out on too much.

(A Top Pick March 22/16. Down 27%.) Got a little ahead of itself. Last week they came out with record 4^th quarter results after some lumpiness through the year, caused by delays in orders by clients. Came out with a solid $.46 EPS for the year under the new accounting standards, which really measures the true profitability of the company. There are high barriers to entry. The only global company that can process 100% organic, chemical free, decaffeinated coffee. They are now exporting all over the world.

Results were disappointing. When he sees companies that tend to be in a decline, he is not interested in purchasing them. Doesn’t feel this is cheap at these levels, and he has concerns that there is lots of competition.

They use a chemical free process for their decaffeinated coffee, which is winning a lot of customers. Tim Hortons is a client. A classic scenario where a company grows very, very fast, and is a thin a trader and relatively cheap. The stock did very, very well, and then they missed an earnings result. Down at these levels, it is much more attractive than it was. He likes it more now, but it is still kind of risky, but better than it was a year ago.