Second Cup: The Growing Coffee Conglomerate

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How often do you see small time start up companies expand into international super power conglomerates ? The answer to that is a motivated creator who believes in the idea, and believe it or not the small investors and the large ones will be the ones behind it. Only one thing, their are smart people who wait for something to be created and they later come in and slowly buy out the idea or if they have the capital they buy it out completely. The small company once a upon a time was founded in 1975 by Tom Culligan and Frank O’dea. after building the small coffee retail business into a 150 – store chain, Culligan eventually possessed a hostile takeover on O’dea’s shareholdings in the company. Later on in 1988 Culligan sold the whole private conglomerate to Michael Bregman. The company in the early 90’s went public and sold all of its shares on major shareholders voting rights agreement to Cara Operations Limited.

Since it’s inception the company today is expanded internationally and is traded publicly on the TSX. If you have the courage to believe in this new and upcoming empire of coffee retail stores and you have what it takes to invest in the company to eventually have power over it’s shareholders and even CEO, then you are the company. Here’s what we mean by this, take a huge look at Warren Buffet when he was just a young man he was buying Berkshire Hathaway stock. The company used to be a textile firm and at the time he aggressively bought shares on the market for as low as $14. At that rate he bought out the company and turned it into a holding firm with subsidiaries under the umbrella. And we are talking huge companies that he overtook, Heinz, Geico etc.

When you buy a share in the company that means you own a percentage of the company wholly. If the companies stock shares profits threw Earnings per share or dividends or both, then you should be motivated to purchase 1%, 2%, 3%, 4%, and more of the companies total market value. This means that when you buy lets just say 5% of the companies shares, you are almost a significant shareholder in the company with more power then shareholders with less shares plus you may have a seat ready for you in the companies Board Of Directors or even be appointed to a CEO of the corporation.

Second Cup Ltd. (SCU.TO) trades on the TSX at $ 5.13 per share closing today on Feb 4, 2014. The companies market capital is $ 50,802,621. This means that the companies total net worth is $ 50,802,621, which also means that it is equal to the share price times the number of shares outstanding in the company. The company has so much room for growth and is giving it everything it has to expand into a mammoth. The CEO of Second Cup  Stacey Mowbray is taking the corporation to another whole new level, in order to obtain environmental and fair trade certifications for every blend on Second Cup’s menu.

Lets talk profits now. The company in 2010’s fiscal year generated a net income of $9.30 million. the companies profits at this point has to give a percentage of that to all shareholders who own more or less shares of the company. So if the company is evaluated at $25 million dollars for that year and the stock price was at $3, your looking at a total outstanding shares of 8,333,333.33. Let’s just say you own 5% of that company, you own 416,667 shares in the company. The profits on those dividends yield at 7% quarterly on the shares that the stock are at. Per share you will be paid 0.21 cents in profit since you own every share of that amount in that company. Pretty much your major shareholding in that company of yours. If you take your total shareholding in that company and multiply that by your dividend per share, 416,667 shares times 0.21 cents will equivalent to $29,166.69 in profits quarterly. Adjusting to the stocks price will also effect the yields return in this case however you will be known to being powerful with the significant shareholding just like any Entrepreneur.

Second cup is in its future for huge growth take the time to invest in the companies stock and help grow it to something bigger and better then its competitors.