Surprise #2: The Trump Election Victory Establishes an Important Precedent and Is Followed by a Broad and General Movement in Which Prominent Businessmen, Celebrities, Sports Figures and Others Without Prior Political or Military Experience Consider Political Office. Among the individuals who initially express an interest in putting their hats in congressional and senatorial contests are Mark Cuban, George Clooney, Neil Patrick Harris, Ashton Kutcher, Justin Timberlake, Ellen DeGeneres, Oprah Winfrey, John Bon Jovi, Kevin Hart, Garth Brooks, LeBron James (who announces his 2018 retirement) and Peyton Manning.
Late in the year, Starbucks Executive Chairman Howard Schultz makes initial (and overt) plans aimed as an early attempt to become the 2020 Democratic presidential candidate and becomes a big favorite for the nomination as major donors, high-profile party operatives, powerful former politicians and leading current Democratic congressional members begin to rally around him.
From a business standpoint, Starbucks faces continued operating margin degradation and a maturing domestic store base. For some time I have felt that these factors would contribute to disappointing EPS results - and that has proven to be the case.
The loss of Schultz's management expertise (he already once turned the company around) is a negative for the company (and represents a further risk to the company's ability to execute through its challenges and headwinds) and I remain short Starbucks.
I initially placed Starbucks on my Best Ideas List (short) in January, 2016 at $60.60. (SBUX closed at $57.07 yesterday).
Here are some of my (negative) write ups on Starbucks over the last year in my Diary:
* Starbucks has one disturbing problem that even its biggest fanboys would admit is a major issue
As to Howard Schultz, a potential political candidate - he has been a catalyst for social change in his role at Starbucks and away from the company.
Schultz's family foundation has been committed to the support of two successful programs: Onward Youth (aimed at promoting employment for young people between the ages of 16 and 24 who are not in school and not working) and Onward Veterans (which support post 9/11 military to successfully transition into civilian life).
For over two years I have suggested that Schultz would be among the leading candidates for the Democratic presidential nomination in 2020.
I still believe this to be the case.
And if this sounds like a personal endorsement... it is.
(This commentary originally appeared on Real Money Pro at 8:17 a.m. ET on June 5. Click here to learn about this dynamic market information service for active traders and to receive Doug Kass's Daily Diary and columns from Paul Price, Bret Jensen and others.)