New York, Feb 1, 2026, 04:53 (EST) — Market closed
- Starbucks shares dropped again on Friday, pushing this week’s decline further into the weekend.
- Analysts flooded in with new price targets, spotlighting the company’s margin turnaround.
- Keep an eye on March 10 for the U.S. loyalty reset, followed by Friday’s U.S. jobs report.
Starbucks shares closed Friday down 2.06% at $91.95, marking their fifth consecutive session of declines amid a generally softer U.S. market. The stock is now roughly 22% below its 52-week peak, with trading volume ticking just above the recent average. (MarketWatch)
Starbucks is pushing the argument that increased foot traffic can cover its costs. On Jan. 28, the coffee giant reported quarterly net revenue climbed 6% to $9.9 billion. Non-GAAP earnings hit 56 cents per share. It also projected fiscal 2026 non-GAAP EPS between $2.15 and $2.40, alongside global comparable-store sales growth of at least 3%. (Comparable-store sales measure outlets open for at least a year.) CEO Brian Niccol said in the statement, “Our Q1 results demonstrate our ‘Back to Starbucks’ strategy is working.” The board announced a $0.62 per share dividend, payable Feb. 27 to shareholders of record Feb. 13. (Starbucks Investor Relations)
Analysts wasted no time reacting to the update. On Friday, several Wall Street firms raised their price targets for Starbucks: BMO Capital bumped theirs up to $120 from $115, Barclays raised it to $116 from $110, and Goldman Sachs nudged it to $105 from $100. All kept their ratings steady. For reference, a price target reflects where analysts expect a stock to trade over the next year. (MarketScreener)
TD Cowen bumped its price target on Starbucks to $89 from $84 but stuck with a Hold rating. Analyst Andrew Charles described the stock as a “momentum story,” hinging on whether sales growth can be sustained. (Investing.com South Africa)
The issue boils down to margins, not coffee. Reuters reported Starbucks saw its first U.S. sales growth in two years, despite operating margins feeling the squeeze from higher labor costs and rising coffee prices. CEO Niccol cautioned that the investments made “will take time” to boost earnings. Mizuho analyst Nick Setyan was more straightforward: “It has been frustrating in terms of the length of this turnaround.” (Reuters)
Starbucks is shifting its focus from broad discounts to loyalty, unveiling a new three-tier U.S. rewards system starting March 10. The perks will escalate from “green” to “gold” to “reserve,” according to Reuters. Kate Hogenson, principal consultant at the Mallett Group, noted that “the best loyalty programs are those that create emotional memories.”
Starbucks plans to ramp up its footprint, aiming to open hundreds of new U.S. stores in the coming years. The company is also boosting seating capacity in current cafes, a move designed to counter the rise of smaller drive-thru competitors. (AP News)
Starbucks isn’t sitting still. According to the Financial Times, the coffee giant plans to ramp up its store openings over the long term, responding to growing competition from fast-expanding chains like Dutch Bros and 7 Brew, as well as the traditional quick-service players. (Financial Times)
The risk lies in sales growth failing to boost profits. Rising labor and coffee costs could offset gains from increased transactions, while a weaker consumer might resist price hikes, driving them to competitors.
U.S. trading kicks off again Monday, with eyes on whether Friday’s drop bounces back as analysts adjust their targets. Outside of Starbucks news, the big macro event ahead is the Feb. 6 U.S. employment report. Its data could shake up rate forecasts and move consumer stocks. (Bureau of Labor Statistics)
Starbucks’ next key event comes March 10, when it rolls out revamped loyalty tiers in the U.S. The question: can this move boost traffic without deepening the margin pressure?
