Starbucks and PepsiCo Present Dividend Investment Opportunities
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy SBUX?
Source: Fool
- Starbucks Performance Recovery: After several challenging years, Starbucks is witnessing an uptick in transactions and average ticket size, driving a 4% year-over-year increase in global comparable store sales, indicating early success of its 'Back to Starbucks' plan.
- Dividend Growth Potential: With a quarterly dividend of $0.62 and an annualized dividend of $2.48, Starbucks is nearing its sustainable payout limit; however, under CEO Brian Niccol's turnaround strategy, further increases are anticipated as the business improves.
- PepsiCo's Steady Growth: Over the past five years, PepsiCo has achieved a 31% revenue increase and a 19% rise in free cash flow, with the latest free cash flow reaching $7.6 billion, demonstrating resilience amid high inflation and pandemic challenges.
- Future Dividend Increase: PepsiCo plans to raise its full-year dividend by 4% to $5.92 in 2026, with the current quarterly dividend at $1.4225 and an annualized dividend of $5.69, indicating a strong outlook for continued dividend growth.
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Analyst Views on SBUX
Wall Street analysts forecast SBUX stock price to fall
21 Analyst Rating
12 Buy
7 Hold
2 Sell
Moderate Buy
Current: 96.760
Low
59.00
Averages
96.12
High
115.00
Current: 96.760
Low
59.00
Averages
96.12
High
115.00
About SBUX
Starbucks Corporations is a roaster, marketer, and retailer of specialty coffee globally. Its North America segment includes the United States and Canada. Its International segment includes China, Japan, Asia Pacific, Europe, Middle East and Africa, Latin America, and the Caribbean. Its North America and International segments include both Company-operated and licensed stores. The Channel Development segment includes roasted whole bean and ground coffees, Starbucks-branded single-serve products, a variety of ready-to-drink beverages, such as Frappuccino and Starbucks Doubleshot, foodservice products, and other branded products sold outside the Company-operated and licensed stores. A large portion of its Channel Development business operates under a licensed model of the Global Coffee Alliance with Nestle, while its global ready-to-drink businesses operate under collaborative relationships with PepsiCo, Inc., Tingyi-Ashi Beverages Holding Co., Ltd., Arla Foods amba, Nestle, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Starbucks and PepsiCo Present Dividend Investment Opportunities
- Starbucks Performance Recovery: After several challenging years, Starbucks is witnessing an uptick in transactions and average ticket size, driving a 4% year-over-year increase in global comparable store sales, indicating early success of its 'Back to Starbucks' plan.
- Dividend Growth Potential: With a quarterly dividend of $0.62 and an annualized dividend of $2.48, Starbucks is nearing its sustainable payout limit; however, under CEO Brian Niccol's turnaround strategy, further increases are anticipated as the business improves.
- PepsiCo's Steady Growth: Over the past five years, PepsiCo has achieved a 31% revenue increase and a 19% rise in free cash flow, with the latest free cash flow reaching $7.6 billion, demonstrating resilience amid high inflation and pandemic challenges.
- Future Dividend Increase: PepsiCo plans to raise its full-year dividend by 4% to $5.92 in 2026, with the current quarterly dividend at $1.4225 and an annualized dividend of $5.69, indicating a strong outlook for continued dividend growth.
See More
Dutch Bros Q4 Revenue Exceeds Expectations with 29.4% Growth
- Significant Revenue Growth: Dutch Bros reported a 29.4% year-over-year revenue increase in Q4, reaching $443.6 million, surpassing Wall Street's expectation of $424.9 million, indicating strong market demand and brand appeal.
- Substantial EPS Increase: The company's earnings per share surged from $0.03 a year ago to $0.17, exceeding analysts' estimate of $0.10, reflecting a notable improvement in profitability.
- Shift in Market Sentiment: Retail sentiment on Dutch Bros jumped from 'bearish' to 'extremely bullish' within a day, with message volumes on Stocktwits soaring by 626%, indicating a significant increase in investor confidence regarding the company's future performance.
- Same-Store Sales Outlook: Dutch Bros anticipates same-store sales growth of 3% to 5% in 2026, suggesting that despite a sluggish overall coffee market, its brand is well-positioned to capture additional market share.
See More
Chipotle's Optimistic Future Outlook with $28 Billion Opportunity
- Earnings Beat: Chipotle exceeded analyst estimates for revenue and earnings per share in Q4 2025, despite a decline in foot traffic across all quarters, indicating resilience in profitability amid challenges.
- Long-Term Growth Potential: CEO Scott Boatwright highlighted a target of achieving $4 million annual unit volumes (AUVs), with the current AUV at $3.1 million, suggesting a revenue potential of $28 billion, which is 135% higher than 2025's revenue.
- Expansion Plans: In 2025, Chipotle opened 334 new locations and aims to open 350 to 370 in 2026, many featuring Chipotlane drive-thru setups that are expected to enhance sales and margins, thereby strengthening competitive positioning.
- Market Confidence Recovery: Despite challenges from lower-income and younger consumers pulling back on spending, Chipotle has continued to grow post-pandemic, with a current P/E ratio of 34.4, down 72% from five years ago, presenting an attractive investment opportunity for investors.
See More
Chipotle's Long-Term Growth Potential Looks Compelling
- Sales Pressure Noted: In 2025, Chipotle experienced a decline in foot traffic, which pressured sales, although the company exceeded analyst estimates for revenue and earnings per share in the fourth quarter of last year, indicating short-term performance volatility.
- Long-Term Growth Confidence: CEO Scott Boatwright expressed confidence during the Q4 2025 earnings call in achieving annual unit volumes (AUVs) of $4 million and approaching 30% margins, despite the current AUV being $3.1 million, highlighting significant future growth potential.
- Clear Expansion Plans: Chipotle aims to open 7,000 restaurants in the future, with 4,042 company-owned locations currently, having opened 334 new locations in 2025, and plans to add 350 to 370 in 2026, leveraging Chipotlane drive-through setups to enhance sales.
- Attractive Valuation: With a current price-to-earnings ratio of 34.4, which is 72% lower than five years ago, investors may find it appealing to consider adding this industry-leading company to their portfolios during the stock's dip after navigating multiple macroeconomic challenges.
See More
Dutch Bros Reports Strong Q4 Growth Amid Industry Challenges
- Significant Revenue Growth: Dutch Bros reported a 29% year-over-year revenue increase in Q4, reaching $443.6 million, accelerating from 25% growth in Q3, demonstrating resilience amid industry downturns and boosting investor confidence.
- Profitability Surge: Adjusted earnings per share (EPS) soared 143% to $0.17, reflecting the company's success in cost control and sales growth, further solidifying its market position.
- Ongoing Store Expansion: The company opened 55 new locations in the quarter, bringing the total to 1,136, with management targeting nearly doubling the store count to 2,029 by 2029, indicating strong confidence in future growth.
- Optimistic Outlook: Dutch Bros is guiding for approximately $2 billion in revenue for 2026, representing 23% growth in line with analyst consensus, while forecasting same-store sales growth of 3% to 5%, showcasing its sustained competitive edge.
See More
Wall Street Analysts Forecast 18% Rise for S&P 500
- S&P 500 Forecast: Wall Street analysts predict an 18% increase in the S&P 500 to 8,200 over the next year, reflecting optimistic market sentiment about economic recovery, which may attract more investors into the market.
- Sector Performance: The information technology and consumer discretionary sectors are expected to grow by 33% and 22%, respectively, indicating that these industries will be focal points for investors, particularly through exposure via Vanguard ETFs.
- Vanguard Tech ETF Performance: The Vanguard Information Technology ETF achieved a total return of 776% over the past decade, equivalent to an annual growth of 24%, showcasing its strong performance in the tech sector, despite underperforming during market corrections.
- Concentration Risk Management: The top three stocks in the Vanguard Information Technology and Consumer Discretionary ETFs account for 44% and 43% of their performance, respectively, prompting investors to consider diversifying their portfolios to mitigate concentration risk and enhance resilience.
See More
Starbucks and PepsiCo Present Dividend Investment Opportunities
- Starbucks Performance Recovery: After several challenging years, Starbucks is witnessing an uptick in transactions and average ticket size, driving a 4% year-over-year increase in global comparable store sales, indicating early success of its 'Back to Starbucks' plan.
- Dividend Growth Potential: With a quarterly dividend of $0.62 and an annualized dividend of $2.48, Starbucks is nearing its sustainable payout limit; however, under CEO Brian Niccol's turnaround strategy, further increases are anticipated as the business improves.
- PepsiCo's Steady Growth: Over the past five years, PepsiCo has achieved a 31% revenue increase and a 19% rise in free cash flow, with the latest free cash flow reaching $7.6 billion, demonstrating resilience amid high inflation and pandemic challenges.
- Future Dividend Increase: PepsiCo plans to raise its full-year dividend by 4% to $5.92 in 2026, with the current quarterly dividend at $1.4225 and an annualized dividend of $5.69, indicating a strong outlook for continued dividend growth.
See More
Dutch Bros Q4 Revenue Exceeds Expectations with 29.4% Growth
- Significant Revenue Growth: Dutch Bros reported a 29.4% year-over-year revenue increase in Q4, reaching $443.6 million, surpassing Wall Street's expectation of $424.9 million, indicating strong market demand and brand appeal.
- Substantial EPS Increase: The company's earnings per share surged from $0.03 a year ago to $0.17, exceeding analysts' estimate of $0.10, reflecting a notable improvement in profitability.
- Shift in Market Sentiment: Retail sentiment on Dutch Bros jumped from 'bearish' to 'extremely bullish' within a day, with message volumes on Stocktwits soaring by 626%, indicating a significant increase in investor confidence regarding the company's future performance.
- Same-Store Sales Outlook: Dutch Bros anticipates same-store sales growth of 3% to 5% in 2026, suggesting that despite a sluggish overall coffee market, its brand is well-positioned to capture additional market share.
See More
Chipotle's Optimistic Future Outlook with $28 Billion Opportunity
- Earnings Beat: Chipotle exceeded analyst estimates for revenue and earnings per share in Q4 2025, despite a decline in foot traffic across all quarters, indicating resilience in profitability amid challenges.
- Long-Term Growth Potential: CEO Scott Boatwright highlighted a target of achieving $4 million annual unit volumes (AUVs), with the current AUV at $3.1 million, suggesting a revenue potential of $28 billion, which is 135% higher than 2025's revenue.
- Expansion Plans: In 2025, Chipotle opened 334 new locations and aims to open 350 to 370 in 2026, many featuring Chipotlane drive-thru setups that are expected to enhance sales and margins, thereby strengthening competitive positioning.
- Market Confidence Recovery: Despite challenges from lower-income and younger consumers pulling back on spending, Chipotle has continued to grow post-pandemic, with a current P/E ratio of 34.4, down 72% from five years ago, presenting an attractive investment opportunity for investors.
See More
Chipotle's Long-Term Growth Potential Looks Compelling
- Sales Pressure Noted: In 2025, Chipotle experienced a decline in foot traffic, which pressured sales, although the company exceeded analyst estimates for revenue and earnings per share in the fourth quarter of last year, indicating short-term performance volatility.
- Long-Term Growth Confidence: CEO Scott Boatwright expressed confidence during the Q4 2025 earnings call in achieving annual unit volumes (AUVs) of $4 million and approaching 30% margins, despite the current AUV being $3.1 million, highlighting significant future growth potential.
- Clear Expansion Plans: Chipotle aims to open 7,000 restaurants in the future, with 4,042 company-owned locations currently, having opened 334 new locations in 2025, and plans to add 350 to 370 in 2026, leveraging Chipotlane drive-through setups to enhance sales.
- Attractive Valuation: With a current price-to-earnings ratio of 34.4, which is 72% lower than five years ago, investors may find it appealing to consider adding this industry-leading company to their portfolios during the stock's dip after navigating multiple macroeconomic challenges.
See More
Dutch Bros Reports Strong Q4 Growth Amid Industry Challenges
- Significant Revenue Growth: Dutch Bros reported a 29% year-over-year revenue increase in Q4, reaching $443.6 million, accelerating from 25% growth in Q3, demonstrating resilience amid industry downturns and boosting investor confidence.
- Profitability Surge: Adjusted earnings per share (EPS) soared 143% to $0.17, reflecting the company's success in cost control and sales growth, further solidifying its market position.
- Ongoing Store Expansion: The company opened 55 new locations in the quarter, bringing the total to 1,136, with management targeting nearly doubling the store count to 2,029 by 2029, indicating strong confidence in future growth.
- Optimistic Outlook: Dutch Bros is guiding for approximately $2 billion in revenue for 2026, representing 23% growth in line with analyst consensus, while forecasting same-store sales growth of 3% to 5%, showcasing its sustained competitive edge.
See More
Wall Street Analysts Forecast 18% Rise for S&P 500
- S&P 500 Forecast: Wall Street analysts predict an 18% increase in the S&P 500 to 8,200 over the next year, reflecting optimistic market sentiment about economic recovery, which may attract more investors into the market.
- Sector Performance: The information technology and consumer discretionary sectors are expected to grow by 33% and 22%, respectively, indicating that these industries will be focal points for investors, particularly through exposure via Vanguard ETFs.
- Vanguard Tech ETF Performance: The Vanguard Information Technology ETF achieved a total return of 776% over the past decade, equivalent to an annual growth of 24%, showcasing its strong performance in the tech sector, despite underperforming during market corrections.
- Concentration Risk Management: The top three stocks in the Vanguard Information Technology and Consumer Discretionary ETFs account for 44% and 43% of their performance, respectively, prompting investors to consider diversifying their portfolios to mitigate concentration risk and enhance resilience.
See More
