Starbucks went down 5% in the last 2 days, which I wasn't expecting... Do you think it'll continue to grow after it gets out of it's rut, or is it pretty much finished?
2007-08-15 15:07:51 · 6 answers · asked by wd20x2 3 in Business & Finance ➔ Investing
Great way to get investment advise.... ask strangers whose qualifications and motives can't be verified. I wish you luck with that approach.
Your whole approach to investing suggests an amateur mindset. I don't say this to be cruel. But.... please take the time to learn about investing.
It's not gambling;
I expected that horse to win.
The horse is in a "rut".
The horse is pretty much finished.
First off...right now the market is expecting a slowdown in the economy. That could hurt a company like SBUX. SBUX is traditionally a high P/E stock (36 right now). That P/E may not be warranted.
There may be issues relating directly to SBUX that caused it to go down. Maybe some big investors needed cash and got out (which would have nothing to do with SBUX).
In short. You don't buy a stock because of a "hunch", you like the product or someone on TV said it was a good buy.
Fundamental and technical research will help. But even then there's no guarantee.
Final thought;
Any experienced investor/trader will have an exit strategy before they buy the stock. To think of this now only adds the emotion of fear which will cloud your judgment.
Hopefully you have a good "asset allocation" and this one stock won't effect you much.
2007-08-15 17:14:15 · answer #1 · answered by Common Sense 7 · 1⤊ 0⤋
Well I don't think you will see its 52 week high for a while. I also look at the moving averages and SBUX crossed and closed its 50 and 200 day moving averages, so my thoughts are it does not look good for (sbux). You may even see some more selling toward the end of the year for taxes
My thoughts
2007-08-16 00:24:16 · answer #2 · answered by Grandpa Shark 7 · 0⤊ 0⤋
Starbucks is a good name product; but I think they will continue facing increased health care costs for their employees as well as increased commodity prices. Competition is enormous too with the likes of Dunkin' Donuts growing as well as many regular and special retail coffee brands.
PE is high, above 30 and with a market cap of about 19.8 bil; it seems a very, very unlikely takeover candidate.
Plus as we see in the mortgage market, the economy seems to be weaking and perhaps alot more people will be less likely to buy a $5 cup of coffee (sepecially now McDonalds coffee was rated better)
FY '08 concensus estimates are for $1.08 with a projected 5 year growth rate of 22% which tells me the stock is worth about $23 a share and currently trading at above $26; i would only consider buying it if it dropped into the $22 level or lower, on further weakness.
2007-08-15 23:18:45 · answer #3 · answered by Anonymous · 1⤊ 0⤋
Some of the gloss has worn off of SBUX. I would not be surprised if more gloss is lost in the next several weeks and months. A price of about 12 to 14 would be about appropriate in my opinion.
2007-08-15 22:48:24 · answer #4 · answered by Anonymous · 1⤊ 1⤋
I believe the fall has something to do with the buzz that they are not supporting the war in any way even if it means not sending product to our troops. 1000's of troops not receiving assistance ripples back to the US where friends and family take on a non-supportive manner to the company because they turned a cold shoulder.
As to your question, yes, you'll see it rise because like all major items during the holidays they will sell millions upon millions of gift cards and that my friend is cash in hand without the product coming out of pocket yet so their final qtr. will reflect major gains.
2007-08-16 02:24:31 · answer #5 · answered by incbuilder 1 · 0⤊ 0⤋
probably
I would bet on WHole Foods though , WFMI
2007-08-15 22:54:02 · answer #6 · answered by Anonymous · 0⤊ 0⤋