Buy Call SBUX

February 5, 2025
Buy the Starbucks (SBUX) January 110 Calls (exp. 1/16/2026) for $14.50 or less.

As I wrote last week, I was growing interested in SBUX as a turnaround play as the stock reacted very well to earnings. This follows the company naming the former CEO of Chipotle to run Starbucks several months before.

Fast forward a couple days later and the stock strength in SBUX is continuing as the stock is breaking out to a new multi-year high today.

Let’s get involved with SBUX with a call that has nearly 12 months until its expiration, for a very reasonable and attractive price. Essentially, IF SBUX is on the verge of a stock turnaround, to pay $14.50 for a year’s worth of exposure could prove to be a big winner.

To execute this trade you need to:
Buy to Open the SBUX January 110 Calls

The most you can lose on this trade is the premium paid, or $1,450 per call purchased.

The risks I see in this trade are largely market-related, and on that note, I would say the market in 2025 is just so/so to mostly choppy.

Also, I do want to note the company is embroiled in an employee strike of some sort … though for now at least that doesn’t seem to be too big of an issue for the stock.

And while there is risk in chasing SBUX after a nice rally, I do like the way SBUX and some of its “peers” in the consumer-related space (EAT/DRI/BROS/WMT/COST) look, and to pay $14.50 for a year’s worth of exposure to a potential turnaround play feels like a great risk/reward opportunity.