SBUX - Is The Business Still As Aromatic ?

SBUX took drastic actions in 2008, namely to reduced the number of coffeeshops they operate worldwide. Seems a reasonable tactical strategy to adopt to counter the expected fewer people buying their expensive kopi; better lower their operating costs if they cannot expect sufficient top line revenue in the immediate future to defray static costs.

The founder obviously lost faith in his CEO employe when he decided to take over the helm. I like this move, because this means Schultz hung up his fishing rod, folded up his sleeves and got back to work... when the founder gets involved again, he either makes it a real success or he will lose his original passion for starting the business and it will not survive challenges.

SBUX - Monthly Chart


Buying into SBUX, to me, is the classic case of buying into a believe of a man, Howard Schultz. If you believe he can restart, rebrand and reinvent SBUX's business, that ~$13 support level should help you to decide if you wana go long haul with howy.

ps : some possible plays

a) long term calendar spreads (at least 6 months)
b) short Oct 13Puts

good luck....