Starbucks (SBUX) Stock Forecast & Price Target

Starbucks maintains a positive outlook due to its significant brand strength and recent improvements in customer engagement, evidenced by a 2.4% quarter-over-quarter increase in lapsed rewards members to 34.6 million. The company's expected revenue growth for 2026 is bolstered by increased sales from company-operated stores, which mitigates declines in licensed and channel development segments, while international same-store sales (SSS) growth projections have been revised upward, particularly in key markets like China. Additionally, improved visitation trends in the early weeks of the fiscal second quarter suggest that Starbucks is effectively enhancing the customer experience, heightening prospects for sales leverage and profitability recovery in the near future.

Starbucks's second quarter earnings per share (EPS) is projected to experience a year-over-year decline greater than the first quarter's -24%, largely influenced by peak restructuring charges and investments. The new CEO's initiatives have failed to significantly enhance traffic growth, and ongoing investments are anticipated to suppress margins over an extended period. Additionally, despite the company's ability to pass on commodity inflation to consumers, it anticipates that volume pressures will lead to lower revenue and profitability, particularly within its channel development segment due to higher input costs.