Things did not go well for coffee giant Starbucks (SBUX) in Malaysia, as political issues came back to haunt it. Rather, a Starbucks operator in Malaysia declared losses, which impacts Starbucks tangentially. Thankfully, that layer of separation gave investors a little peace of mind, and Starbucks shares gained fractionally in Thursday afternoon’s trading.
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The Starbucks operator in Malaysia, Berjaya Food Bhd. (BRYAF), saw its net loss more than triple for the financial year that ended in June, reports noted. Revenues also fell, down 36% against this time last year. The biggest reason for the decline was “…the prolonged impact of the ongoing sentiment related to the Middle East conflict, which affected market dynamics and influenced customers’ spending patterns.”
The impact of the Gaza conflict required Berjaya Food to take a “…necessary impairment provision” to several elements of its balance sheet. This included the right-of-use asset, which was hit by an overall downsizing of Starbucks in Malaysia, reports noted.
North Korea Fakes a Starbucks
Way back in 2011, Cracked offered up a look at why North Korea was “…the funniest evil dictatorship ever.” This included such things as the terrifying and half-finished Ryugyong Hotel, also known as the “Hotel of Doom” for its unusual design. There was also the Meeting Hall for Separated Families, a resort sponsored, at the time, by Hyundai (HYMLF) that allowed families separated by the Korean War to meet once a year. And now, North Korea has a fake Starbucks.
The coffee shop, known as Mirai Reserve, looks a lot like a Starbucks Reserve, except the star in the logo has been replaced with the letter M. Starbucks, of course, does not acknowledge that it has a store in North Korea, which is actually banned by United Nations sanction. The coffee shop in question can be found at the Rangrang Patriotic Geumganggwan, a multi-story shopping mall. In North Korea.
Is Starbucks Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SBUX stock based on 14 Buys, eight Holds and two Sells assigned in the past three months, as indicated by the graphic below. After a 7.59% loss in its share price over the past year, the average SBUX price target of $100.68 per share implies 14.09% upside potential.
