Starbucks Corp. (SBUX) Shares Slip, Investors Watching Closely, Here is Why

Starbucks Corp. (NASDAQ: SBUX) shares rose on Tuesday Nov 22 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.

Meanwhile, The Dow Jones Industrial Average opened opened higher, trading above 19,000 for the first time ever, while the S&P 500 traded above 2,200 shortly after the opening bell on Tuesday.

The S&P 500 SPX, +0.17% opened 5 points, or 0.2%, higher at 2,202. The Dow Jones Industrial Average DJIA, +0.20% added 45 points, or 0.2%, to 19,002. The Nasdaq Composite COMP, +0.25% began the session up 16 points, or 0.3%, at 5,385.

Shares of Starbucks Corp. (NASDAQ: SBUX) were downgraded by analysts at Vetr Inc. in a note to their investors today. The company currently has a rating of Buy on the stock. The one-year price target of $64.54 is higher than the opening price of $56.32, causing a fair amount of other analysts to report on the stock recently. Looking back over the last year, Starbucks Corp. stock has a high of $62.54. Downgrades are more common when analysts feel that the future prospects for the security have dropped from the original recommendation, usually caused by an important and integral digression in the company’s procedures, future vision or industry.

Starbucks Corp. (NASDAQ: SBUX) shares last traded at $56.14, a jump of $0.04 or 0.07% compared to the previous closing price. Opening at $56.32, they ranged from $55.88 and $56.32 throughout the day.

Starbucks Corp. (NASDAQ: SBUX) now has a market cap of 81.99B.

Starbucks Corp. (NASDAQ: SBUX) Average Daily Trading Volume

685,753 shares crossed the trading desk yesterday, below the norm, out of a total float 1,422,045,000. Look for trading volume to pick up in the coming days as investors often use swings in trading volume to determine substantial volume growth or dissemination by institutional investors.

While increased trading for one day will not mean much, conversely, a trend of heavy trading volume on the buy side over a period of days or weeks sends a positive cue to market traders that institutions may be moving in, so institutional sponsorship is critical.

Institutional sponsorship simply refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.

Professional investors such as these have substantial teams of analysts that investigate thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.

Starbucks Corp. (NASDAQ: SBUX) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By following the activity of these professional investors and how they affect moving averages, traders can make the best trades.

With that in mind, Starbucks Corp. (NASDAQ: SBUX) now has a 50-day MA of $53.70 and 200-day MA of $55.21. It has traded in a 52-week range between $50.84 – 62.540 and today’s last price is 10.23%% lower than the 52 week high of $62.54.

Earnings growth is a critical factor to research when buying stocks and investors seek companies that have raised their earnings at least 25% or more over the past 3 years.

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