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Starbucks, the Seattle-based coffee company, continues to expand globally. In the upcoming year, Starbucks plans to accelerate unit growth by opening 1,000 new stores to its existent 17,400 locations worldwide.
The menu has been revamped, as well. In April, Starbucks added caffeinated fruit drinks known as Starbucks Refreshers. In June, with the $100 million acquisition of San Francisco-based BayBread, Starbucks introduced La Boulange brand bakery products to increase the sales of non-coffee items.
These improvements may make the world’s largest coffee shop chain appear stronger than ever, but Starbucks’ second-quarter financial results tell a different story.
Second-quarter same-store sales estimates failed to meet expectations on April 26. Sales at stores open at least 13 months rose 7 percent globally, below projections of 8.2 percent.
After the report, Starbucks stock fell 4 percent in after-market trading. The stock continues to trade flat near $52, after coming off a high of $61.15 on April 26. A recent UBS report suggested the momentum trade may be over for Starbucks.
Investors are receiving mixed signals, but analysts are confident that Starbucks stock will trade higher in the near future.
Nicole Miller Regan, Piper Jaffray senior research analyst, cited high commodity costs as a likely culprit of the recent decline.
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