Starbucks (SBUX) reported a disappointing quarter recently, but Jim Cramer is sticking with the stock for his charitable trust -- and might even buy more -- because he thinks the coffee-store giant could go to $70 a share from its current $59 or so if third-quarter results look good.
Cramer noted during an exclusive conference call this week with members of his Action Alerts PLUS investment club that his charitable portfolio had lightened up on Starbucks ahead of the company's latest earnings report, but that he'd look to buy some back if the stock dips to $58 a share.
Starbucks reported soft fiscal-second-quarter U.S. sales as the chain struggles to deal with customers who place their orders online and pick up items in-store. Cramer noted that the system has turned many Starbucks U.S. outlets into crowded "mosh pits."
"Even though China [sales were] unbelievably good, it didn't really matter because of the same mobile issues that had bedeviled Panera (PNRA) ," he said.
But Cramer noted that PNRA has gotten its online ordering system under control, and he believes that Starbucks can as well.
"I think the company is restoring order, and by the end of the third quarter, we will know that things are now better," the stock picker said. "If that's the case, the stock should go to $70, because that would be a terrific same-store acceleration domestically that would quickly be rewarded."
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(Editor's pick. This item originally ran at 3:21 p.m. ET on May 18.)