I enjoy a few minutes (sometimes a few hours) in the comfy, air-conditioned confines of a Starbucks. Happens once, twice, maybe three times a week. Conveniently located near my mid-day pit stops. I may long for a Vanilla Bean Frappucino, but lately, I've been disciplined enough to get the Green Tea (iced) at just $1.60. I don't need the extra fat and calories from a Vanilla Bean Frap, and it costs $2.50 more anyway.
But SBUX the stock is what piques my imagination. Expansion in China. Cool Factor. Is it just too big to grow any more, though? The stock has been stuck in coffee sludge for almost a year now, ever since it hit $40 in mid-November. The P/E became astronomical and the PPS couldn't justify further buying. I'm not a short, never will be, but ...
Anyway, I sit there in Starbucks with my Apple PowerBook (yes, too cheap to buy a new MacBook), Crocs on my feet and Green Tea in my belly. The thought of owning any SBUX shares hasn't occurred in a long time, but Howard Lindzon offers his reasoning for buying in here below 27.
Lindzon: Starbucks…enough marked time?
Of course, Howard is purely about trends and it has served him well. Fundamentals and technicals be damned in Howard's world. What strikes me more than his ability to spot and own trends is his penchant for finding stocks at a discount. In this case, SBUX is more than 30% off its all-time high. That's something I can dig. A little more digging and maybe I'll be convinced enough to buy more than a Green Iced Tea.
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