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Starbucks Divests Juice Unit to Focus on Core Business; Exits Russia
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Starbucks Divests Juice Unit to Focus on Core Business; Exits Russia

Story Highlights

Starbucks is divesting its juice brand in a bid to channel energy into its stores and the people running them. It is also exiting Russia in the current environment.

Starbucks Corp. (SBUX) has agreed to sell the Evolution Fresh brand and business to Bolthouse Farms. Employees in the juice unit will also transition to Bolthouse. The move enables Starbucks to concentrate on its core operations.

Management Weighs In

Jeff Dunn, the Chairman and CEO of Bolthouse, commented, “Evolution Fresh is a natural extension of the Bolthouse portfolio and we look forward to welcoming the team…By bringing Evolution Fresh into our portfolio, we will extend our spirit of ingenuity and innovation, sharing resources and passion for high-quality, nutrient-dense juices to pioneer solutions for today’s food system.”

Hans Melotte, Executive Vice President Global Channel Development of Starbucks, said, ”We feel there is a great runway and opportunity to take Evolution Fresh to the next level, and Bolthouse Farms’ considerable experience and success in the premium beverage category will allow the brand to continue growing.”

While the deal amount remains undisclosed, the transaction is expected to close later in 2022. Evolution Fresh further expands Bolthouse’s portfolio of brands, which includes names such as Chosen Foods, MaryRuth Organics, and Gerry’s Organics.

For Starbucks, the move allows CEO Howard Schultz to focus on the company’s core business, its stores, and the people running them.  

Exiting Russia

On Monday, Starbucks said it is shutting down its 130 Russian stores but will continue to pay its employees in Russia for about six months. In the wake of the Ukraine –Russia conflict, a number of major names, including McDonald’s, have closed their Russia operations.

Retail Investors Stick with Starbucks

At the time of writing, TipRanks database indicates that investor sentiment remains very positive about Starbucks. Of the best performing portfolios on Tipranks, the number of portfolios holding the stock has increased by 5.3% in the last 30 days.

Closing Note

Starbucks shares are down 37.7% so far in 2022. A multitude of factors have been weighing on the stock for a while now. As Howard Schultz steers the company through challenging times, the sale of the juice unit helps Starbucks remain focused on its key areas. Furthermore, company initiatives coupled with Schultz’s buying back Starbucks shares seem to have buoyed investor sentiment.

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