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Barclays on Starbucks (SBUX): Bakery Acquisition A Logical Step, But Visibility Limited

June 5, 2012 1:18 PM EDT Send to a Friend
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Price: $78.83 +0.11%

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    25 Buy, 4 Hold, 1 Sell

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    Up: 35 | Down: 21 | New: 12
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Barclays maintains a 'Equalweight' on Starbucks (NASDAQ: SBUX) price target of $58.00.

Analyst, Jeffrey A. Bernstein, said, "SBUX announced the acquisition of Bay Bread and its La Boulange bakery brand, which will serve as a catalyst for enhanced food offerings at SBUX US stores. Needless to say, we have overarching concerns of distraction from the core coffee platform and / or damage to the existing customer experience, similar to concerns from other recent non-coffee initiatives."

Bernstein sees SBUX's second half 2012 earnings diluted by $0.02/share from the acquisition, but maintains FY12 estimates, citing conservative overall guidance based on underlying U.S. momentum.

For an analyst ratings summary and ratings history on Starbucks click here. For more ratings news on Starbucks click here.

Shares of Starbucks closed at $53.90 yesterday.




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