Earnings have improved each year since 2008, and this year the company reported earnings of 40 cents versus analysts’ estimates of 38 cents. It is estimated to earn $1.84 in 2012 versus $1.62 in 2011, and $2.25 in 2013.
But the stock market’s recent lethargy has taken a toll on the price of SBUX, dropping it from a high of $62. It is trading in a common bull market consolidation pattern called a “flag.” It gapped down through its first support at the 20-day moving average (green line) and the next support is at $56. But our buy under price is at its 50-day moving average now at around $54.50.
The intermediate target for SBUX is $62, but long-term investors should put Starbucks on their list of top stocks to buy as a long-term hold.
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