Starbucks Changes Its Strategy… and Wins? Outlook for Coffee Behemoth's Stock

<p>One of
the most famous coffee brands in the world appears to be ushering in a new era
in its history. Simultaneously, the latest Starbucks report garnered mainly
positive feedback from analysts. So, do these shares present a compelling
investment opportunity right now? Or is everything more intricate than it
seems?</p><p>First,
let's take a look at the trajectory of Starbucks stock in the last 12 months.
The chart below demonstrates an 18% growth, which could lend a more positive
outlook to your portfolio's performance. Also, if you want to find more shares
with robust returns, you may find value in <a href="https://www.tradingview.com/screener/" target="_blank" rel="follow">using
stock screener</a>. This tool provides a list of assets aligned with
your filters and criteria.</p><p>Starbucks
stock has achieved even more impressive results over the past five years,
significantly surpassing the average market growth. Its performance has notably
outpaced the <a href="https://www.tradingview.com/symbols/SPX/" target="_blank" rel="follow">S&amp;P 500</a>, registering a 97% gain compared
to the latter's 59%.</p><p>The
vital catalyst behind the changes in Starbucks' business strategy was the Covid
pandemic (yes, we all were a bit of Starbucks back then). This marked a moment
when trends took a turn, and people started to work at home more frequently.
Spending time in chain coffee shops with a cup having a trendy logo became more
appealing than engaging in the same ritual at the office. However, the choice
between the comforts of home and Starbucks allure is less obvious. </p><p>Therefore,
Starbucks is recalibrating its approach. The company bets on digitalization,
which enables customers to swiftly grab coffee, order deliveries, and
participate in a loyalty program. Additionally, the company is expanding its
footprint in smaller cities. This move is connected with the surge in remote
work, as some customers opt for locales removed from metropolises. </p><p>Also,
Starbucks is upgrading its equipment in coffee shops – it provides an
opportunity to offer superior-quality coffee and diversify the menu with new
selections like trendy iced beverages and plant-based options. </p><p>What
about the latest financial report? It revealed mixed results for fiscal Q3 2022
but mostly positive ones. Earnings per share (EPS) exceeded expectations,
totaling $1 compared to the projected $0.95. The revenue was higher than Q3
2021 by 12%; however, it fell slightly short of estimates. Overall, sales are
growing. And also, the Chinese economy's recovery, regardless of its pace,
might become a driver for their future increase.</p><p>These
factors collectively embolden analysts to set optimistic targets for Starbucks
stock. The consensus forecast anticipates a 12% surge over the next 12 months,
carrying a "Buy" rating.</p><p>However,
if the idea of immediately acquiring additional Starbucks shares crosses your
mind, please stop – it's a bad one. It's better to start with a cup of coffee
instead. And after that, you can conduct your own analysis, hereby facilitating
an informed decision-making process.</p>

This article was written by FL Contributors at www.forexlive.com.