Zacks maintained a neutral rating on Peet's shares, and held a Zacks #3 Rank for Starbucks, indicating a short-term hold rating.


Still others caution the rumors remain just that, and an actual deal is still extremely speculative. Some consider that Starbucks would be more likely to consider acquiring a food and/or confections company as it looks to expand its operations beyond coffee.

Peet's retail stores may compete too closely with the in-store operations of Starbucks to make a merger financially viable, say some industry experts.

Sources told Financial Times that Peet's would be a better target for companies like Kraft Foods ( KFT) or Nestle SA's ( NSRGY).

Janney Capital Markets analyst Mitchell Pinheiro said a Peet's buyout by Starbucks would dilute the buyer's marketing bandwidth. "Why would you need another super-premium coffee brand, when I'd argue Starbucks is the number one super-premium coffee brand in the country, if not the world?" he asked.

He added that devoted Peet's customers, known as "Peetnicks," are typically anti-Starbucks and could become disillusioned with the brand if Starbucks were to take it over, choosing instead to spend their coffee dollars elsewhere.

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