Here is an article from IBD earlier this week on Peets/DDRX. Mentions the fast growing single serve market, and GMCR as leader of coffee related stocks:

Coffee Buyout Unites Leaders Of 2 Industries
By JUAN CARLOS ARANCIBIA, INVESTOR'S BUSINESS DAILY
Posted 11/03/2009 05:54 PM ET


The coffee industry got a welcomed jolt Tuesday after the merger of two leaders in that niche.

Peet's Coffee & Tea (PEET) agreed to acquire Diedrich Coffee (DDRX) in a cash-and-stock deal valued at $213 million, or $26 a share. That represented a premium of 28% over Diedrich's closing price Monday.

Diedrich shares gapped up 27%. Peet's soared 11%. Diedrich is in the retail-wholesale food industry group, ranked 28th out of 197 in Tuesday's IBD. Peet's is in the restaurants group, ranked 149th.

Peet's shares had broken out of a base on Oct. 28, thanks to a strong quarterly earnings report. The company raised its profit guidance, too.

Diedrich also already had broken out. It cleared an irregular cup with handle on Oct. 19. The stock had slid as much as 24% below its 26.22 buy point on Monday, before the news came out after the close.

With the acquisition, Peet's expands into the fast-growing single-cup market. Diedrich makes K-Cups, which let coffee drinkers make a single cup at a time using Keurig-brand brewers.

Green Mountain Coffee Roasters (GMCR) makes the brewers. Green Mountain is the leader among several coffee-related stocks found in the restaurants and food industry groups. Starbucks (SBUX), the best- known coffee chain, is up 175% from its March low.

With the acquisition, Diedrich stands to benefit from Peet's production and distribution muscle.

"Diedrich's business will immediately benefit from the infrastructure that Peet's has developed to support large scale, national growth of its premium quality coffees," read a statement from Peet's.