×

Cramer: Starbucks downgrade OK, but …

CNBC's Jim Cramer does not mind the latest Starbucks downgrade, but investors should mind the risks of pulling out of the stock.

"I find that this is the problem with this kind of downgrade," he said Tuesday on "Squawk on the Street." "You have to sell it here and maybe buy it back at $54. I think that the company has great worldwide momentum. The idea that its valuation is stretched is a relative thing versus the rest of the market."

Deutsche Bank downgraded Starbucks' stock to "hold" from "buy," citing a high valuation and "lofty" investor expectations. Shares of the coffee-making giant closed down 2.3 percent Tuesday.


"This is a very good company whose stock has run. I just think the risk here is can you get back in after you sell it," Cramer said.

The company's stock has gained over 20 percent in the last year.

Starbucks shares year over year

Disclosure: Cramer's trust owned Starbucks stock when this article was published.