Can Oatmeal Revive Starbucks?

Perhaps it will be the world's first oatmeal-based comeback.

While criticizing others for not "even nibbling on the story," Barron's played it up big in a feature this weekend: Starbucks(SBUX Quote - Cramer on SBUX - Stock Picks) is coming back. In these troubled times, troubled Starbucks is the place to park your money. And oatmeal is going to drive the profits.

Here is the headline and subheadline: " Something Good Is Brewing: Starbucks aims to get its buzz back -- and its stock up -- with new products and promotions that distinguish it from the crowd. The oatmeal offensive."

Perhaps the company, which stumbled in part because food offerings slowed down service in its stores while also eliminating that signature waft coffee you got when you even opened the door, will be saved by the most-boring food of them all. The Business Press Maven is a lot of things, but I'm not a master arbiter of oatmeal's ability to save billion dollar enterprises, so I'll leave that judgment to those wiser and richer in fiber.

They Just Don't Get Starbucks!

The main issue is this that, in making such a big call, Barron's made a few basic mistakes that you, the savvy investor, should be aware of. The most glaring was that Starbucks will benefit overall by a decline in the price of leases because of the miserable nature of the economy.

Look at this line: "The cost of leasing real estate also should fall, as more empty storefronts appear."

But net-net, this would have no impact on Starbucks. That's because falling lease rates due to every third store getting boarded up do imply a weak consumer economy. And any costs saved from the shuttering of neighborhood stores and declining demand for real estate space will certainly come attached to a listless consumer, especially one of expensive but in the end unneeded or replaceable daily luxuries. Unless, of course, oatmeal saves the day.

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