Starbucks shares close higher on Thursday, company to acquire the remaining stake in East China joint venture

According to a July 27th statement by Starbucks Corporation (SBUX), it intends to acquire the remaining 50% stake in its East China business from its joint venture partners Uni-President Enterprises Corp and President Chain Store Corp. The acquisition would be valued at approximately $1.3 billion. After the deal is finalized, the coffee chain will own about 1 300 stores in Shanghai as well as in Zhejiang and Jiangsu provinces.

Starbucks shares closed higher for the third time in the past nine trading sessions on Thursday. It has also been the steepest daily surge since November 7th 2016. The stock went up 2.69% ($1.56) to $59.50, after touching an intraday high at $59.66, or a price level not seen since June 27th ($59.69). In the week ended on July 23rd the shares of the coffee chain lost 1.33% of their market value compared to a week ago, which marked the sixth drop in the past seven weeks. The stock has neutralized earlier losses and is now up 2.04% so far during the current month, following an 8.33% slump in June. The latter has been the first drop out of five months and also the most considerable one since January 2014. For the entire past year, the shares of the NASDAQ-listed retailer lost 7.51%.

Starbucks plans to operate 5 000 stores in mainland China by the year 2021. The number of its stores in Shanghai alone has already reached almost 600, or a number not seen in any other city.

Meanwhile, the company also intends to sell its 50% stake in its Taiwanese joint venture to Uni-President Enterprises Corp and President Chain Store Corp for as much as $175 million.

The two separate deals are to be finalized by the beginning of 2018.

According to CNN Money, the 30 analysts, offering 12-month forecasts regarding Starbucks Corporation’s stock price, have a median target of $66.50, with a high estimate of $75.00 and a low estimate of $57.00. The median estimate is an 11.76% surge compared to the closing price of $59.50 on July 27th.

The same media also reported that 24 out of 33 surveyed investment analysts had rated Starbucks Corporation’s stock as “Buy”, while 7 – as “Hold”.

Daily and Weekly Pivot Levels

With the help of the Camarilla calculation method, todays levels of importance for the Starbucks stock are presented as follows:

R1 – $59.66
R2 – $59.82
R3 (Range Resistance – Sell) – $59.98
R4 (Long Breakout) – $60.45
R5 (Breakout Target 1) – $61.01
R6 (Breakout Target 2) – $61.28

S1 – $59.34
S2 – $59.18
S3 (Range Support – Buy) – $59.02
S4 (Short Breakout) – $58.55
S5 (Breakout Target 1) – $57.99
S6 (Breakout Target 2) – $57.72

By using the traditional method of calculation, the weekly levels of importance for Starbucks Corporation (SBUX) are presented as follows:

Central Pivot Point – $58.18
R1 – $58.67
R2 – $59.36
R3 – $59.85
R4 – $60.34

S1 – $57.49
S2 – $57.00
S3 – $56.31
S4 – $55.62