Starbucks Stock Rises After Upgrade by TD Cowen
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 22 hours ago
0mins
Should l Buy SBUX?
Source: CNBC
- Upgrade Impact: TD Cowen upgraded Starbucks from hold to buy, raising the price target from $106 to $120, indicating that the company's turnaround is ahead of schedule, which could drive further stock price increases.
- Sales Forecast Increase: Analysts raised North America's same-store sales forecasts for 2026 to 2028 to 6.1%, 5%, and 4%, respectively, exceeding Wall Street consensus, reflecting market confidence in Starbucks' future growth.
- Earnings Estimate Boost: TD Cowen increased its earnings per share estimate for Starbucks to $3.94 by fiscal 2028, a 9% rise above the consensus of $3.65, indicating the company's potential in cost control and sales growth.
- Cautious Market Sentiment: Despite the upgrade, analysts remain cautious about Starbucks, noting the need to restore historical margins, with fewer than half of analysts rating the stock as buy, highlighting concerns over its profitability recovery.
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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: 106.400
Low
59.00
Averages
96.12
High
115.00
Current: 106.400
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.
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- International Review: The company is reviewing its international support organizations and anticipates further job cuts outside the U.S., indicating a strong commitment to cost reduction on a global scale.
- Cost Reduction Measures: Starbucks expects to incur approximately $120 million in severance payments and reduce the book value of certain real estate by $280 million, primarily related to reserve and roastery locations, highlighting the urgency of its cost-control efforts.
- Strategic Investment: Despite the layoffs, Starbucks plans to invest $100 million in establishing a new support office in Nashville, Tennessee, where it expects to hire 2,000 employees over the next five years, demonstrating its intent to expand in specific regions.
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