Starbucks Corporation (NASDAQ:SBUX) is one of the stocks that Jim Cramer shared thoughts on. A caller asked Cramer whether their son should buy the stock now or wait, and he said:
“Your kid’s got horse sense. I would tell him to buy some now, the stock was down. That is the way to go. I like that. That’s the best stock of the whole darn lightning round.”
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Starbucks (NASDAQ:SBUX) sells coffee, tea, beverages, and food items through its stores and branded products. During the July 11 episode, Cramer recommended buying the stock. He commented:
“This morning, Starbucks came up as part of the conversation on Squawk on the Street as a source of coffee beans from Brazil, and what’s going to happen now that President Trump just hit Brazil with a 50% tariff. Ah, just one more reason to [sell, sell, sell] Starbucks, right? Wrong. The actual price of coffee beans represents less than 10% of the cost of a cup of coffee. Sure, Brazil’s important, but Starbucks, with its incredible scale, is better suited than anyone else to be able to deal with and find cheaper source of beans.
More important, Starbucks is another stock that people want to buy when it’s hot and stay away from when it’s cold, even if it’s being run by a proven commodity who knows how to execute a turnaround. I remember the turn that CEO Brian Niccol engineered at Chipotle before he went to Starbucks after some nasty foodborne illnesses sent the stock in a tailspin.
Niccol came in at the beginning of 2018 when Chipotle stock was at around $6, alright, keep that in your mind. He left for Starbucks a little less than a year ago when Chipotle was at $56. Are we really supposed to believe that the price of Brazilian coffee beans is going to reverse that turnaround that he’s organizing? I think that’s insane. Stock’s down more than 20 points from its high, even if it’s quickly rebounded from today’s low. This is the right time to buy Starbucks. Goes down a little more, you get to buy more.”
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Disclosure: None. This article is originally published at Insider Monkey.
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