Jefferies also cut its price target to $76 from $80
Jefferies downgraded Starbucks Corp (NASDAQ:SBUX) to "underperform" from "hold," with a price-target cut to $76 from $80 before the bell this morning. The coffee giant shot higher in August after news that the company was replacing CEO Laxman Narasimhan with Chipotle (CMG) CEO Brian Niccol, but this bear note cited reasons why Starbucks' turnaround could still take a while.
At last glance today, SBUX was up 0.2% at $95.68, reversing earlier losses that had it on track for a third-straight daily dip. As September winds down, the security remains on track for its third consecutive monthly gain. Additionally, the shares have added more than 22% this quarter.
Puts have been more popular than usual in the last 10 weeks. Starbucks stock's 50-day put/call volume ratio of 1.18 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 93% of readings from the past year.
Options traders are pricing in low volatility expectations too, per SBUX's Schaeffer's Volatility Index (SVI) of 23%, which sits in the relatively low 25th percentile of its annual range. Plus, SBUX has tended to exceed said expectations, per its Schaeffer's Volatility Scorecard (SVS) of 98 out of 100.