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On April 5 of this year, Hedgeye Managing Director of Restaurants Howard Penney explained his bearish case for Green Mountain Coffee Roasters (GMCR), which was trading around $40 a share. Here’s the jist of it (and please note our #timestamp):

“04/05/12 10:49AM EDT GMCR: THE SLOW DRIP OF THE GREAT COFFEE BUBBLE

When we consider that GMCR has now declined for 10 days in a row and insiders are exiting the stock, it is easy to concoct a bearish story.  The question is: how bearish is bearish enough?  We think the stock could go to $25.”

GMCR: Zero Chance? - GMCR bleeding

GMCR makes the Keurig coffee brewing machines, which it has patented. Unfortunately for Green Mountain, that patent is set to expire next month. Penney noted that GMCR has the possibility of going to $25 a share; that came and went. Now we’re at $20 a share and continuing to head lower.  As you can see in the chart above, GMCR has lost 77% of its value over a one-year period. Penney reiterated his bearish stance today. The patent issue, combined with accounting irregularities that came forth this year and increasing pressure from Starbucks (SBUX) makes a tough case for Green Mountain.