Starbucks shares fall the most since late July 2017 on Wednesday following a subdued sales forecast for the US, China

Shares of Starbucks Corporation (SBUX) registered their worst daily performance in eleven months on Wednesday, after the US company released a subdued forecast regarding sales in its home market as well as in its second-largest market – China, which urged some analysts to revise down their rating on the stock.

Starbucks shares closed lower for the first time in the past five trading sessions on NASDAQ on Wednesday. It has also been the steepest daily loss since July 28th 2017. The stock went down 9.07% ($5.21) to $52.22, after touching an intraday low at $51.58, or a price level not seen since November 4th 2016 ($50.84).

Shares of Starbucks Corporation have retreated 9.07% so far in 2018 compared with a 3.50% gain for the underlying index, S&P 500 (SPX).

In 2017, Starbucks Corp’s stock rose 3.44%, thus, it again underperformed the S&P 500, which registered a 19.42% return.

The coffee chain said on Tuesday it now projected sales at established stores to grow by a mere 1% during the fiscal third quarter. That compares with a median analyst estimate pointing to a 3% sales growth.

At the same time, the company projects its comparable-store sales in China to register zero growth during the quarter ended in June.

John Glass of Morgan Stanley was surprised by Starbucks’ forecast for China, especially after three quarters ago the companys same-store sales in the Asian country had recorded an 8% surge.

The analyst downgraded the stock from “Overweight” to “Equal-weight” and also noted the overall projection might raise concerns whether Starbucks’ growth in its home market was sustainable as well.

Bonnie Herzog of Wells Fargo said that Starbucks Corps China forecast was utterly discouraging, while “putting a damper on some of the optimism we came away with after visiting China last month.”

However, there have also been opinions, according to which a sharper focus on digital initiatives, such as mobile app and on-line order promotions, might in part offset the slowdown in sales in Starbucks Corps essential markets.

According to CNN Money, the 27 analysts, offering 12-month forecasts regarding Starbucks Corporation’s stock price, have a median target of $65.00, with a high estimate of $72.00 and a low estimate of $57.72. The median estimate represents a 24.47% upside compared to the closing price of $52.22 on June 20th.

The same media also reported that 17 out of 30 surveyed investment analysts had rated Starbucks Corporation’s stock as “Buy”, while 12 – 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 – $52.53
R2 – $52.85
R3 (Range Resistance – Sell) – $53.16
R4 (Long Breakout) – $54.11
R5 (Breakout Target 1) – $55.21
R6 (Breakout Target 2) – $55.69

S1 – $51.91
S2 – $51.59
S3 (Range Support – Buy) – $51.28
S4 (Short Breakout) – $50.33
S5 (Breakout Target 1) – $49.23
S6 (Breakout Target 2) – $48.75

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

Central Pivot Point – $56.83
R1 – $57.49
R2 – $57.86
R3 – $58.52
R4 – $59.17

S1 – $56.46
S2 – $55.80
S3 – $55.43
S4 – $55.05