Melius Research Upgrades Starbucks to Hold Amid Signs of Turnaround
One of Wall Street's most skeptical analysts has upgraded Starbucks from sell to hold, citing evidence that the company is delivering on its turnaround strategy under CEO Brian Niccol. Melius Research highlighted four consecutive quarters of positive global comparable sales and a year-over-year expansion in North America operating margin for the first time since early 2024 as key proof points. The firm noted Starbucks' recent earnings report, which included an upward revision to full-year guidance on EPS, operating margin, and comp sales. While Melius acknowledged that some of the profit improvement was aided by tariff refunds, it emphasized that margins still expanded even excluding this benefit. The analyst raised its price target from $85 to $110 but cautioned that much of the turnaround is already reflected in Starbucks' stock valuation. Starbucks shares have gained 25% year-to-date compared to an 11% rise for the S&P 500, signaling growing investor confidence. Analyst Jim Cramer has also expressed optimism about Niccol's leadership and the company’s progress.
Tickers: $SBUX
Topics: Earnings Upgrade Melius Research Starbucks