Starbucks Stock Slumps After Jefferies Downgrade

Starbucks SBUX shares slipping 1.6% in premarket trading after Jefferies downgraded the stock to Sell and slapped on a street?low $76 price target, suggesting nearly 18% downside. Andy Barish at Jefferies pointed to softer credit?card spending, lighter foot traffic and weaker app engagement as reasons to dial back U.S. same?store sales forecasts for the next two quarters.

Barish also warned that ongoing staffing headaches and heavy investment spending continue to eat into profits. Meanwhile, over at Barclays, Jeff Bernstein trimmed his target to $106 but stayed bullish, citing recent value promotions and a rebound in casual dining trends versus quick?service peers as reasons to keep a Buy rating.

This tug?of?war between Jefferies' bearish caution and Barclays' relative optimism underscores just how mixed the outlook is for Starbucks right now. It's worth weighing Barish's concerns about a stretched growth runway against Bernstein's upbeat view on customer metrics before making any calls.