We recently published a list of Jim Cramer’s Top 11 Trump Trades: Winners and Losers. Since Starbucks Corp (NASDAQ:SBUX) ranks 8th on the list, it deserves a deeper look.
Jim Cramer in a latest program talked about the consequences of the failed assassination attempt on Donald Trump and mentioned a few stocks that could benefit if the former President comes to power again.
“You are sticking your head in the sand if you think nothing has changed after the failed assassination attempt on the now-official Republican nominee for President.”
Cramer said that the “frightening moments” of the assassination attempt have indeed “cut in the favor” of Trump’s win and he was “already leading in the polls.”
Cramer recalled the days when he was the anchor of Kudlow & Cramer show and Biden was a senator from Delaware. Cramer said Biden once told him that he was the “poorest senator out of one hundred because he owned no stocks.”
“He was actually bragging about it,” Cramer said.
Cramer said that Joe Biden is not the “champion” of stocks and he’s “on board with labor.”
Jim Cramer’s Thoughts on Donald Trump
Here’s what Cramer said about Trump:
“In the many years I’ve known Trump and I have known him fairly well, he’s been wildely pro stock market, always watching it like a hawk. He loves bantering about the stock market.”
Cramer said that even though Trump was in “real estate, he enjoyed stocks.”
Jim Cramer added that Trump always thought there was too much regulation and was also “wildly” pro-oil and gas. The CNBC host said since Trump cannot see the stock market going down and sees the market gains as a positive factor even for his presidency, his arrival in the White House could boost stock portfolios.
“Hate him or like him, he’s good for your portfolio.”
For this article watched the latest programs of Cramer where he mentioned stocks that could benefit from a Trump presidency. With each stock, we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Starbucks Corp (NASDAQ:SBUX)
Number of Hedge Fund Investors: 69
Jim Cramer thinks Starbucks would be a loser if Trump comes to power amid the possibility of trade wars with China.
Starbucks Corp (NASDAQ:SBUX) fell after the company posted weak fiscal Q2 results and guidance, as customers in China and across the globe cut back on spending. However, many analysts believe the stock is presenting an opportunity for long-term investors. Based on Wall Street’s 2025 EPS estimate ($8.67) for Starbucks Corp (NASDAQ:SBUX), the stock is trading at a forward P/E multiple of 19, which is not much higher than the industry median of 14.97. Given Starbucks Corp’s (NASDAQ:SBUX) brand value and moat, the company stands out amongst competitors. The stock’s current P/E of 22 is also much lower than Starbucks Corp’s (NASDAQ:SBUX) five-year average P/E of 30. SBUX is one of the top dividend stocks to buy in 2024.
Madison Investors Fund stated the following regarding Starbucks Corporation (NASDAQ:SBUX) in its Q2 2024 investor letter:
“We purchased shares in Starbucks Corporation and Deere & Company. Starbucks Corporation (NASDAQ:SBUX) is a global specialty coffee chain with an iconic brand that resonates with consumers around the world. Its loyalty rewards program is a true differentiator, with its unmatched scale (nearly 33 million members in the U.S. alone), and convenient mobile ordering and customization capabilities.
The company has struggled over the last handful of years due to the pandemic shut-downs, the lingering traffic declines from workers no longer commuting to city centers, intensifying competition in China, and inflation in wages, freight, and packaging. But its biggest challenge is actually one of its own making. It’s a victim of its own success.
Over the last decade it has led the industry in shifting its business mix from hot beverages to cold beverages, and from in-store purchases to the use of mobile ordering and drive-thrus. These shifts have been hugely beneficial to Starbucks, intensifying customer loyalty, raising the frequency of purchases, appealing to younger consumers, and raising average selling prices. Yet, these benefits came at a very high price. The speed at which these shifts occurred left Starbucks management unprepared to handle the increase in operational complexity and customer expectations of faster service. The result was a noticeable decline in both customer experience and store employee satisfaction…” (Click here to read the full text)
Overall, Starbucks Corp (NASDAQ:SBUX) ranks 8th on Insider Monkey’s list titled Jim Cramer’s Top 11 Trump Trades: Winners and Losers. While we acknowledge the potential of Starbucks Corp (NASDAQ:SBUX), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SBUX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.