Starbucks Climbing Back

by The Investment U Research Team

In a rare bit of truly positive earnings, Starbucks (Nasdaq: SBUX) announced that it earned $151 million in the third quarter compared to a loss of $6.7 million last year. This news sent the shares up over 10%.

Even as overall sales were down, Starbucks’ focus on efficiency and cost savings at ever level has helped the bottom line – combined with store closings of almost 700 locations. These changes, combined with others, have started trickling down into its results.

Starbucks has been aggressively looking to change its image on a couple fronts. Starbucks gave away free pastries earlier this week, and is looking at natural products as well.

It’s also been looking to its stronghold Seattle market to test new store concepts that involve adding beer and wine at Starbucks’ stores. And in other locations, removing the ubiquitous Starbucks branding to give the appearance of more affordable local coffee shops.

We’ve been watching this stock since the return of CEO and founder Howard Shultz earlier this year. And it looks like he’s starting to gain some real momentum in making positive changes.

If this keeps up, he’ll bring the company back to its roots and its stock glory days of almost $40 a share.

Symbols mentioned in this article: SBUX.

• Starbucks (Nasdaq: SBUX): Don’t Sip On This Stock Just Yet
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