Starbucks Implements New Customer Policy Amid Earnings Expectations SBUX is making significant adjustments before its upcoming first-quarter earnings report.
Beginning Monday, only customers who make a purchase, or those with paying customers, will gain access to its cafés, patios, and restrooms. The offering of free water will also cease, and baristas have been trained to uphold these new regulations.
This shift comes in response to a 5% decline in North American transactions in 2024, marking the first yearly drop since the onset of the pandemic. As Starbucks prepares to report earnings on January 28, analysts anticipate a same-store sales decrease of 4.8%, projecting earnings per share (EPS) at $0.67 and revenue at $9.32 billion, based on data from Benzinga Pro.
Discover: What if You Had Invested $100 in This Stock 20 Years Ago?
Starbucks Holds Firm Despite New Policy Debates
Chart created using Benzinga Pro
This more stringent approach marks a departure from a 2018 policy that permitted anyone to access Starbucks locations, a decision taken after criticism arose from the arrest of two men in a Philadelphia store.
Despite the controversies surrounding the new policy, investor confidence appears unshaken, as reported by The Financial Times.
Starbucks stock continues its bullish trend, currently trading at $98.81, well above its significant moving averages. The stock is indicating robust buying interest, supported by the eight-day, 20-day, and 50-day simple moving averages (SMAs), all suggesting upward momentum.
The moving average convergence/divergence (MACD) stands at 0.98, while a relative strength index (RSI) of 66.69 indicates that bullish momentum remains in Starbucks’ favor as it approaches the earnings announcement.
Could Earnings Results Spark Positive Change?
With expectations already moderated due to decreased customer traffic, Starbucks’ earnings report could act as a pivotal point for the company’s future.
If there are signs of sales recovery, the current bullish trend might continue. Conversely, if the new customer policy proves ineffective, it could lead investors to reconsider their outlook on Starbucks’ recovery strategy.
Explore Further:
Image: Shutterstock
Market News and Data brought to you by Benzinga APIs
