A number of Wall Street firms have raised their price targets on Starbucks (SBUX) following the coffee machine’s notable quarterly report last week and continued signs that management is doubling down on investments in the company, which further highlights why we are in it for the long haul. shareholders of this iconic brand. Barclays raised its price target on Starbucks to $123 per share on Monday from $116 per share, while maintaining an overweight on the stock. The call comes after bank analysts met with Starbucks executives, who reportedly painted an optimistic picture for fiscal 2024. “Continued investments in both salaries [and] “The equipment has enabled stores to become more productive while helping to improve customers’ employment experience,” Barclays analysts wrote in a research note to clients. Indeed, Starbucks subsequently announced Monday that it plans to increase the hourly wages of its U.S. retail employees, or partners, by at least 3% starting early next year. “With significant continued investments of more than $1 billion since last year to improve the overall partner and store experience, the company has seen a positive shift in hourly turnover rates, which are now below pre-pandemic levels,” Starbucks said in a statement Monday. The move is part of the company’s “Triple Shot Reinvention Plan”, led by recently appointed CEO Laxman Narasimhan. The plan includes more than $1 billion in investments in employee pay increases, new store equipment to speed up order flow, digital innovation and supply chain improvements, according to the company. “The goal of the reinvention plan was to improve the experience in our stores for our partners and through our partners. for our customers,” Narasimhan said during ‘a presentation to investors last Thursday. These comments follow Starbucks’ positive surprise for its fiscal fourth quarter, which included strong same-store sales growth and excellent margin expansion. These results have given us renewed confidence in Starbucks’ ability to achieve its long-term goals, including in China, which remains a key growth market for the coffee chain. “I think Starbucks is now a leader because it has one thing going for it: It has a new CEO, Laxman Narasimhan,” Jim Cramer said Monday. “He’s a guy who is interested in consumer products and really understands technology,” he added. SBUX YTD mountain Performance SBUX since the beginning of the year. Meanwhile, Wedbush also raised its price target on Starbucks on Monday to $106 per share from $100 per share, while reiterating a neutral rating on the stock. RBC Capital raised its price target to $111 per share from $99, with a sector perform rating. And Citi raised its price target to $110 per share on Sunday from $100 per share, maintaining a neutral rating on the stock. Since the coffee giant released its report last Thursday before the opening bell, shares have surged more than 13%, trading around $103.80 each. Following the results, we reiterated a 1 rating on the stock, meaning we would be Buys at current levels. (Jim Cramer’s Charitable Trust is long SBUX. See here for a complete list of stocks.) As a subscriber to CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after a trade alert is sent before buying or selling a stock in his charity’s portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after the trade alert is issued before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AS WELL AS OUR DISCLAIMER. NO OBLIGATION OR FIDUCIARY OBLIGATION EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
The Starbucks logo is seen on a cup in this photo taken in the airport cafe in Charleroi, Belgium, July 27, 2023.
Jakub Porzyck | Nuphoto | Getty Images
A number of Wall Street companies have raised their price targets. Starbucks (SBUX) following the coffee maker’s remarkable quarterly report last week and continued signs that management is doubling down on investment in the company, further underscoring why we are long-term shareholders of this iconic brand.
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