Starbucks, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Danilo Gargiulo from Bernstein maintained a Buy rating on the stock and has a $100.00 price target.
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Danilo Gargiulo’s rating is based on Starbucks’ strategic labor investments and expected financial performance. The company plans to invest significantly in its workforce, which is anticipated to enhance store productivity and customer experience. This investment is expected to reduce employee turnover and improve service speed, ultimately driving customer traffic back to the stores. Although a temporary decline in North American traffic is expected, a rebound is anticipated in the coming years, supported by strategic pricing, innovation, and improved store environments.
Furthermore, Starbucks is projected to achieve substantial earnings growth, with expectations of returning to robust EBIT margins and significant EPS growth by 2028. The stock is anticipated to trade at a premium, reflecting investor confidence in the company’s turnaround strategy and growth potential. With these factors in mind, Gargiulo maintains an Outperform rating and has raised the price target, indicating a positive outlook for Starbucks’ stock performance in the near future.
In another report released on June 26, Barclays also maintained a Buy rating on the stock with a $108.00 price target.