Today, Starbucks announced that it expects dairy prices to be a negative in 2008. At a Goldman Sachs retail conference in New York, Peter Bocian, Starbucks' executive vice president and chief financial officer designate said the company had tried to mitigate the cost of dairy through 2 price increases over 12 months. He said the company worked to try and balance price points and customer experience with the reality of rising dairy costs. Bocian said Starbucks hasn't seen a huge impact from jitters in the macro-economic environment, except for some customers on the margin.

Bocian backed the company's fiscal 2007 profit forecast in the range of 87 cents to 89 cents per share and net revenue growth of about 20%. He said hitting the high end of the range will be challenging. For fiscal 2008, the company also said it expects revenue growth of about 18%.

The stock is down nearly 1% today as it sits perched on its 10-day and 20-day moving averages. The equity's recent rally has run into resistance at the security's declining 20-week moving average, which SBUX has not finished a week above since mid-January 2007. In fact, since tagging a high of 40.01 in November 2006, the shares have shed 31%.

Options players are naturally skeptical of the shares. Schaeffer's put/call open interest ratio rests at 1.01, which is higher than 72% of those taken during the past 52 weeks. However, this reading is still far from a pessimistic extreme, as more bears jumping on this underperformer could pressure the security lower during the near term.