Starbucks Upgraded On Anticipated Same-store Sales Growth

Starbucks Corp. was upgraded on Thursday to buy from hold at Stifel, with analysts anticipating same-store sales growth to accelerate to at least 5% to 6% for the next four quarters, starting in the fiscal third quarter. The price target was raised to $67 from $60. Analysts say the company will benefit from "increasingly favorable comparisons" and "modest contribution" from beverages, more food options, and technology. The My Starbucks Rewards loyalty program and mobile order and pay are also expected to continue to contribute to same-store sales growth. Stifel also thinks the company has opportunities to grow its global packaged coffee and tea and ready-to-drink beverage businesses. "Starbucks shares have meaningfully underperformed consumer and restaurant peers over the past 12 months, and we believe meeting consensus comp expectations will result in outperformance," analysts wrote. Starbucks shares are up 1.5% in Thursday premarket trading and up 6.3% for the year so far. The S&P 500 index is up 4.4% for 2017 to date.