#7 - Starbucks (NASDAQ:SBUX)
If I told you Starbucks (NASDAQ:SBUX) stock was down 7% the year would you believe it? Yeah, me neither. Not with all the pictures of pumpkin spice lattes on my social media timeline. Granted, that’s a terrible metric for looking at a stock’s performance. However, the company was not immune to the effects of pandemic lockdowns both in the United States and China.
And China is not an insignificant part of this story. The company has formed a partnership with Alibaba (NYSE:BABA) and is benefiting from the struggles of Luckin Coffee (OTCMKTS:LKNCY).
However, in the United States, the company has proven to be nimble. In addition to building out a curbside delivery model on the fly, the company has continued to expand. In the last quarter, the chain opened 130 new locations. And, the business recovered enough for the company to not only payout but increase its dividend. That’s nothing to ignore in this economy.
In a worst-case economic scenario (i.e. more lockdowns), the company is more prepared which should be less bad for SBUX stock. And in an economy that continues to recover, the stock looks even better.
About Starbucks
Starbucks Corporation, together with its subsidiaries, operates as a roaster, marketer, and retailer of coffee worldwide. The company operates through three segments: North America, International, and Channel Development. Its stores offer coffee and tea beverages, roasted whole beans and ground coffees, single serve products, and ready-to-drink beverages; and various food products, such as pastries, breakfast sandwiches, and lunch items.
More about Starbucks- Current Price
- $106.48
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 18 Buy Ratings, 6 Hold Ratings, 3 Sell Ratings.
- Consensus Price Target
- $105.75 (-0.7% Downside)
September is historically a poor year for stocks. October has provided a couple of the nastiest days in the market’s history. But if history teaches us anything, it’s that the market is remarkably resilient. There are many unknowns as we move into the fourth quarter of 2020, but one thing we’ve seen this year is that the market wants to move higher.
But not all stocks will be part of that recovery. The fourth quarter may continue to be volatile in the tech sector. And banking stocks will be under pressure as the next earnings season gets underway. But there will be winners as well. And one way to look for those winners is to dig deeply into some of the sectors to find value.
That’s the goal here. These seven stocks may not be top of mind on many investor’s lists, but they show the potential to deliver an upside surprise for risk-tolerant investors.
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