Starbucks Hits New High as Coffee Prices Stay Low (SBUX, DNKN)
ThinkstockStarbucks Corp. (NASDAQ: SBUX) raised the bar this morning, posting a new 52-week high of $53.37. Almost certainly the share price rise is due to the continued low prices for coffee and the prospect that those low prices will continue…
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Starbucks Corp. (NASDAQ: SBUX) raised the bar this morning, posting a new 52-week high of $53.37. Almost certainly the share price rise is due to the continued low prices for coffee and the prospect that those low prices will continue at least through mid-year. Dunkin’ Brands Group Inc. (NASDAQ: DNKN) came within pennies of its 52-week high as well.
Coffee futures are well below $2/pound, at around $1.83, far from the price of over $3/pound reached last may. This year’s crop from Brazil is better than expected and is selling at a discount of $0.10/pound in New York according to Bloomberg News.
The Brazilian crop through September next year is expected to rise to a record of more than 52 million 132-pound bags.
Starbucks raised its prices when coffee prices were high, but very likely doesn’t plan to lower them now that prices have fallen. Shocking.
Paul Ausick
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.