The thought of someone grieving for a lost location of coffee giant Starbucks (SBUX) might sound like a bridge too far, but honestly, I can understand it. I feel something similar whenever I see a converted Blockbuster Video sign, or drive by a Family Video that is now, say, a liquor store. But Starbucks’ Project Bloom closures are actually generating grief responses, a move that probably should have meant more to shareholders than it did. Shareholders actually pulled back, and shares dropped fractionally in Thursday afternoon’s trading.
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Stories are coming in from all over, including one about an 11-year-old girl who apparently favored going to the Starbucks near her house to enjoy some quiet time in a recently renovated space. Apparently, the 11-year-old had even made friends with one of the baristas there, a woman named Brittany, who signed cups with particular interest. The 11-year-old in question enjoyed the cups so much she actually brought one home with her.
So when that 11-year-old found out the Starbucks was closing, she took it hard, but in stride. She even went so far as to make a good-bye card for Brittany, in grand 11-year-old fashion, complete with an entire insert page of hearts and stickers. That Starbucks could engender that kind of reaction is good news for Starbucks, as it demonstrates the whole “Back to Starbucks” project can work. That is, assuming it does not close too many of the stores for people to go back to.
More Cup Writing Troubles
The whole concept of cup writing was supposed to be a fun little thing Starbucks did to better connect with customers. Reasonable enough on the surface, but it is starting to become more of a liability than anything, as demonstrated by the latest issue over a simple saying, “Have an ‘ice’ day!”
The particular slogan was written on the side of a cold brew drink, and the couple who got the drink in question—Bianca and Emmanuel Madrigal—immediately figured that the ICE was “Immigration and Customs Enforcement.” Starbucks, for its part, declared the message a “misunderstanding,” which is reasonable given that most cold-brewed coffee is served over ice. Starbucks also noted that it “…asked our baristas at that store to stick to more traditional, less easy to misunderstand messages going forward.” Which likely means that, eventually, Starbucks will be expecting its baristas to project warmth and connection with pre-scripted phrases and everyone will be shocked when it does not work.
Is Starbucks Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SBUX stock based on 13 Buys, six Holds and two Sells assigned in the past three months, as indicated by the graphic below. After a 14.74% loss in its share price over the past year, the average SBUX price target of $101.84 per share implies 27.68% upside potential.
