Trading Nation

Stock is up 16,000% but still time to buy: Traders

Two pros pick Starbucks over Dunkin
Two pros pick Starbucks over Dunkin

Coffee stocks are heating up.

Starbucks and Dunkin Brands hit new all-time highs Monday, both gaining more than 2 percent on the day as consumer-based stocks dominated the broad market rally. Starbucks and Dunkin have been on hyperdrive year to date, up a respective 36 and 32 percent. But according to one technician, the charts are showing one favorite: Starbucks.

"Both stocks are extremely strong, but Starbucks looks better technically," Todd Gordon founder of, said Monday on CNBC's "Power Lunch."

Gordon noted that Starbucks has held up extremely well during broader market uncertainty. "If you look at the chart, you see that as the Nasdaq sold off in late June, Starbucks stock consolidated and maintained a firm bit," Gordon said. "We've since broken out of that range from June and I think we are going to the upper end of that channel," he said.

Gordon expects Starbucks to test the upper end of its long-term trading range at around $58 a share, or roughly 4 percent higher from current levels.

When it comes to long-term fundamental growth, Cowen and Co.'s head of sales trading, David Seaburg, said there's no question Starbucks is the better pick.

The Seattle-based company's shares are up more than 16,000 percent from the June 1992 IPO but Seaburg said it's still poised to profit. "This is a consensus long, buy and hold stock," Seaburg said in a "Trading Nation" segment. "When I look at Starbucks I see a company that's executed well. The management team has a ton of credibility, especially after laying out their five-year growth plan on an analyst call at the end of 2014."

On Monday, Starbucks announced it would spearhead a multicompany initiative to hire 100,000 young minority workers over the next three years.

Read More Starbucks-led group commits to hiring 100,000 youth

"So here's a stock again, from a long-term perspective, I think it can work out well and I think it's a better choice versus Dunkin," added Seaburg.

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