1 day Ago By [email protected] (Neil Patel)
While many investors want the stocks that they own to soar in price over time, there are some market participants who appreciate the passive income that their holdings throw off on a consistent basis. Starbucks ( SBUX -1.75% ) might catch the attention of these folks.
The world's leading coffee enterprise has paid a steadily rising dividend since 2010. The current yield sits at a healthy 2.9%.
The only issue is that this stock is down 37% from its peak price, which was hit in July 2021. Might Starbucks shares be ready to skyrocket again? Hitting a rough patch The company's stock performance in recent years might cause you to scratch your head. That's because fiscal 2023 revenue of $36 billion was 24% higher than the coffee chain generated in 2021, with operating income up 21% over that two-year stretch.
Unsurprisingly, the business took a hit during the pandemic's height, but it has since been on a solid recovery path. However, shares have been on a downswing in the past 14 months, and they immediately dipped 16% following the second-quarter 2024 (ended March 31) financial update. It's not hard to figure out why.
During the 13-week period, same-store sales declined 3% in the U.S., which is the company's most important market.
This was driven by a troubling 7% drop in transaction counts. In the huge China market, it's a worse situation as same-store sales tanked 11%. CEO Laxman Narasimhan called this a "challenging operating environment" as consumers become more selective with.
