Piper Sandler on Starbucks (SBUX): 'We Remain Quite Bullish'

Piper Sandler analyst Brian Mullan reiterated an Overweight rating and $102.00 price target on Starbucks (NASDAQ: SBUX).

The analyst commented: "SBUX The Stock – We Remain Quite Bullish: In our experience, SBUX remains a debated stock, with the shorter-term debate revolving around its ability to improve operations in the stores; and with open questions revolving around how fast this can happen, how much it will cost, what is or what is not properly contemplated by sell-side consensus estimates, and whether or not the valuation of the stock makes sense at this exact moment in time. While these things all “matter” to us, the purpose of this note is more around discussing where we think things are headed with this story over the next 12 to 18 months. Management has explicitly stated that it still sees a significant unit growth opportunity in the U.S., which we think at least some portion of the Investment Community is skeptical about, at this time. It is the emergence of these smaller chains in particular that leads to at least some of (but not necessarily all of) said investor skepticism that we sense. Separate from that, management has discussed a desire to restart successful menu innovation at SBUX again; which from a stock perspective, is simply a way of “driving SSS.” While new management hasn’t explicitly called out the Energy category, that doesn’t mean investors should be thinking about it; hence our coverage of this topic, in this note."

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 $93.12 yesterday.

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