Starbucks Stock up From Annual Lows on C-Suite Shakeup, Analyst Upgrade

J.P. Morgan Securities chimed in with an upgrade to "overweight"

Digital Content Manager
Mar 16, 2022 at 9:31 AM
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News came out this morning that Starbucks Corporation (NASDAQ:SBUX) CEO Kevin Johnson will be retiring after five years leading the company, replaced by Howard Schultz as an interim CEO. This will be Schultz's third time taking on the leading role at the coffee company, while Starbucks said it is searching for another long-term successor. 

Starbucks stock is getting a boost on the news, last seen up 5.3% at $87.50. The equity is now just two sessions removed from its March 14, 18-month low of $78.92. SBUX has been feeling pressure at its 10- and 20-day moving averages, and has lost roughly 28% this year. It's worth noting, though, that the security's 14-day Relative Strength Index (RSI) of 25 puts it well into "oversold" territory, and could be in indicative of a short-term bounce on the charts. 

The brokerage bunch is split on SBUX, though it looks like the tides may turn soon. J.P. Morgan Securities raised its rating to "overweight" from "neutral" early this morning, saying its current valuation invites "more upside than downside." Heading into today, 14 considered the stock a "strong buy," while 13 said "hold." Meanwhile the 12-month consensus price target of $114.45 is a 30.1% premium to last night's close. 

There's been an uptick in bearish trading in the options pits. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security sports a 50-day put/call volume ratio that sits higher than all but 1% of readings from the past 12 months. This means that while calls are still outnumbering puts on an overall basis, the latter have rarely been more popular during the past 10 weeks. 

 

 

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