Starbucks (SBUX) Stock Forecast & Price Target

Starbucks demonstrates a positive outlook bolstered by same-store sales improvements, with a reported increase of 3.8% in North America and 2.5% internationally for fiscal year 2026, driven by recovery in transactions and enhanced food offerings. The company is also experiencing robust expansion, with new store growth projected at approximately 1,360 locations in the current year and 1,920 locations in fiscal year 2026, reflecting a solid trajectory for market penetration despite slowing openings in major markets. Moreover, a significant increase in customer value perception across all demographics supports the potential for continued revenue growth and consumer engagement.

Starbucks has experienced notable margin erosion, with its operating margin falling 180 basis points below estimates and a substantial 730 basis points decline in the North America segment margin compared to the previous year. This deterioration is partially attributed to the closure of 438 underperforming stores in North America, which has negatively impacted revenue forecasts and indicates potential over-earning in the previous two to three years. Additionally, external economic pressures, promotional missteps, weakening sales in key markets like Japan and China, and a sustained increase in coffee costs contribute to the negative outlook for the company's financial performance.