William Blair analyst Sharon Zackfia has maintained their neutral stance on SBUX stock, giving a Hold rating on October 30.
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Sharon Zackfia has given her Hold rating due to a combination of factors surrounding Starbucks’ recent strategic decisions and financial outlook. The sale of a 60% stake in Starbucks China to Boyu Capital, valued at $4 billion, is a significant move aimed at revitalizing the brand’s growth in the region. Although this transaction is expected to be neutral to modestly dilutive initially, Starbucks anticipates that the retained stake and licensing economics will eventually enhance the overall value of its China operations.
Despite the potential for long-term growth through innovation and expansion in China, Zackfia maintains a cautious stance. The decision to hold is influenced by the expectation that Starbucks’ profit growth will lag behind sales due to substantial labor investments. Additionally, the current stock valuation, trading at 34 times the 2026 EPS estimate, suggests limited upside potential in the near term, especially with Zackfia’s estimates trailing consensus by over 10%.
In another report released on October 30, Citi also maintained a Hold rating on the stock with a $83.00 price target.