Jefferies Downgrades Starbucks to Underperform, Maintains Price Target at $76.00 USD.

Starbucks (SBUX) has been downgraded to Underperform by Jefferies, with a maintained price target of $76.00 USD. Analyst Andy Barish shifted the rating from Hold to Underperform, but the expected valuation range remains stable. Despite the downgrade, the current price target aligns with the previous valuation, indicating no dramatic shifts in Starbucks' financial performance are expected in the near term.

Jefferies has downgraded Starbucks (SBUX) to Underperform, maintaining a price target of $76.00 USD. Analyst Andy Barish shifted the rating from Hold to Underperform, but the expected valuation range remains stable. Despite the downgrade, the current price target aligns with the previous valuation, indicating no dramatic shifts in Starbucks' financial performance are expected in the near term [1].

The downgrade comes as Jefferies believes the stock has "surpassed reasonable expectations for improving fundamentals" [2]. The firm expressed concerns about Starbucks’ near-term performance prospects, which align with the company’s high P/E ratio of 33.7x and recent revenue decline of 0.5% [3]. Credit and debit card data, along with foot traffic and app usage metrics, suggest potential downside to consensus estimates for Starbucks’ fiscal third and fourth quarter U.S. comparable sales [2].

Jefferies also highlighted that "significant investments" by Starbucks would likely weigh on the company’s earnings, contributing to the firm’s more cautious outlook and below-consensus estimates for the near term [3]. Despite these concerns, the company continues to maintain a consistent dividend program, with a quarterly cash dividend of $0.61 per share payable on August 29, 2025 [3].

Analysts have shared varying insights on Starbucks’ stock. While Melius Research initiated coverage with a Sell rating and an $80 price target, expressing concerns over operational consistency and competition in China, Citi raised its price target to $100, maintaining a Neutral rating, with optimism surrounding the Green Apron initiative’s impact on same-store sales [3]. Stifel reiterated a Buy rating with a $105 price target, highlighting ongoing discussions regarding a potential stake sale in Starbucks’ China business [3].

References:
[1] https://www.cnbc.com/2025/07/17/stocks-making-the-biggest-premarket-moves.html
[2] https://seekingalpha.com/news/4468346-starbucks-facing-hurdles-to-meet-comparable-sales-estimates---jefferies
[3] https://www.investing.com/news/analyst-ratings/jefferies-downgrades-starbucks-stock-rating-to-underperform-on-operational-concerns-93CH-4138841