Jim Cramer on Starbucks: "Maybe the Most Controversial Stock in the 500"

Starbucks Corporation (NASDAQ:SBUX) is one of the stocks Jim Cramer recently put under a microscope. Cramer called it an “early-stage turnaround story,” as he commented:

“Alright, next, maybe the most controversial stock in the 500, it’s called Starbucks. This is an early-stage turnaround story under the leadership of the fantastic Brian Niccol. But many investors may have gotten impatient because they don’t recognize that these turnarounds usually take a long time… Starbucks has basically been range-bound for weeks, but lately, the stock’s rebounded off its lows and it’s back above the 50-day moving average…

Lang thinks Starbucks could keep trading sideways for weeks to come. But at this point, we know the stock was able to bottom in the high 70s last week. When you look at the moving average convergence divergence or the MACD line, this is really important… Starbucks is about to make a bullish crossover. That is the most bullish thing in the chart book. It’s one of the most reliable positive patterns. I think this is amazing. Then Chaikin money flow… it has started to turn up. Really bullish again…

As Lang sees it, Starbucks is building a nice base here, and if the stock can break out above 90… he thinks it could roar. We’ve been telling investors that Niccol’s getting his arms around how poorly run Starbucks was before he took over… He’s now attacking the basics of staffing and throughput as he gets the company back on track. We’re believers.”

Starbucks Corporation (NASDAQ:SBUX) sells coffee, tea, beverages, and food items under brands like Starbucks Coffee, Teavana, and Seattle’s Best Coffee.

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Disclosure: None. This article is originally published at Insider Monkey.