Posts Tagged ‘China’

Over the past year Starbucks Corporation (NASDAQ:SBUX) has made headline news in future plans for the company. Not only did the acquire Evolution Fresh, Inc. to tap into the fruit drinks, healthy shakes market but have most recently reported that they will be making there way into India by the end of August 2012. Starbucks, along with Asia’s largest publicly traded coffee grower, Tata Coffee Ltd, have plans to open close to 50 stores spreading Frappuccino aromas to the two largest cities in India Mumbai and India’s Capital city Delhi. There has been talk of the coffee outlets opening in shopping malls, office parks, universities, train stations, and even airports.

Most recently Starbucks Coffee Company has now made headlines of announcing an agreement to form a joint venture with Ai Ni Group. Ai Ni Group of which is China‘s most established coffee operators, and agricultural companies in the city of Yunnan. This joint venture will be controlled by Starbucks.

Currently Starbucks Corporation (NASDAQ:SBUX) – Has a 52 week moving average of $32.17  – $48.62. Since PoulTrend Alert back on 10/3/2011, Starbucks has climbed over 30%. Not only is Starbucks a dividend payer, it has a P/E of 29 Times Earnings which may suggest that investors feel there is great potential in the future outlook for Starbucks.

In a recent Blog Post by Scaeffer’s Research  BMO boosted its price target to $57 from $51.

Currently I Love this company however think there will be some time before we see Starbucks Corporation (NASDAQ:SBUX) trading up at or around $57.00 a share. Many have concerns on Starbucks and there expansion to other countries like India, and China. Not only is this market hard to please, but they are always looking for a bargain prices. There may be some time before Starbucks can pull in profits from the expansion to these countries, OR there could be the possibility that it just does not work out for them as they are expecting.

Currently I still have Starbucks Corporation (NASDAQ:SBUX) Rated a HOLD. I would recommend trying to wait, and see if you can get this stock at a better value as  over $45.00 a share is a little to pricey in my eyes.

Currently I do not own any Shares of Starbucks Corporation (NASDAQ:SBUX) and have no plans to make a position within the next 3 trading days.

With S & P now Downgraded America’s from AAA to AA+ Long Term. As we are all aware of China is the largest foreign United States debt holder. China also had strong criticism, downing the US for all the reckless spending behavior. They announced that the “Good Old Borrowing” days are completely over for the United States, and not giving a time frame on when their might be a changed decision.  Many have talked about China being extremely worried about the United States Debt Holdings of which are valued at $1.1 trillion. So far in the first 5 months of 2011, China changed its holding margins by over $300 Million. Standard Charting Bank Announced that China purchased around $24 billion of German/France AAA bonds, as well as $72 billion worth of European Corporate bonds.  From some of my readings many analysts have stated that their is no way  that China has to continue to buy US debt . No matter what happens the United States is China’s biggest trading partner.Information to note, China is currently ranked sixth in the world in Gold Reserves. It is estimated that China has holding over 1,000 tons which is around 1/8 of the United States Gold Reserves.  Is it possible that China will push, and go all in for Gold. Over the past 10 Years gold has climbed to the $1700.00 dollar an ounce which is the all-time high. With the fact that the United States could possibly hit a major double dip, and with other countries having major issues with Debt, China Might be smart in going in as it might be safe haven for their assets. However  it also may be a huge risk to go in as it is at all time highs their could be a major sell off if China pops the price pushing it over the $2000.00 an ounce mark.

At the end of the day none is sure what will happen, and who knows maybe it is still a good time to get into the Gold Rush! We will just have to wait and see what happens.