Analysts at Barclays (BCS) raised their price target on retail coffee chain Starbucks (SBUX) to $119 a share from $108 previously and reiterated their Buy rating on the stock.
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In a note to clients, Barclays analysts said they see, “potential upside to top-line growth, margins and valuation over time under the reins of revered CEO Brian Niccol.” Barclays optimistic outlook for SBUX stock comes after a bruising period for the company and its shareholders.
Over the last 12 months, SBUX stock has been flat amid a raging bull market that has seen the benchmark S&P 500 index rise 25%. Starbucks has struggled with declining sales, consumers that have balked at its high prices, and efforts to unionize the company’s workers.
Sunny Days Ahead?
Despite the challenges, Barclays said that it believes Brian Niccol is the right person to turn the ship around at Starbucks and restore investor confidence in the stock. Barclays price target on SBUX stock is nearly 30% higher than where the shares currently trade.
Niccol took the helm of Starbucks last September, joining the company following a successful turnaround effort at Chipotle Mexican Grill (CMG). Since becoming CEO, Niccol has taken several steps to improve the situation at Starbucks, including ending discount prices and focusing more on advertising. He has also named a new head of global branding at the coffee chain.
Is SBUX Stock a Buy?
Starbucks’ stock has a consensus Moderate Buy rating among 24 Wall Street analysts. That rating is based on 14 Buy, six Hold, and four Sell recommendations issued in the last three months. The average SBUX price target of $103.52 implies 12.28% upside from current levels.
