This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Why Investors Love Starbucks: Howard Schultz

Stocks in this article: SBUX DNKN MCD

Marc Courtenay, a contributor to TheStreet and owner of Advanced Investor Technologies, as well as the publisher and editor of, says Starbucks is now "a comeback story."

"Investors do have great confidence in Howard, and based on his comments yesterday they could tell that Howard is keenly aware that the company has to grow its online, digital business as well as opening new bricks-and-mortar stores," Courtenay writes in an email.

Investors gave the company and the stock a "vote of confidence" for 2014, because the company still has a lot of untapped opportunity internationally.

Credit Suisse analyst Karen Holthouse said Starbucks "still represents the most attractive multinational investment opportunity in restaurants."

Holthouse says that from a valuation standpoint, Starbucks is "more compelling than investors realize," according to a note on Friday. Credit Suisse rates Starbucks shares "outperform."

The company is also "benefitting from an outperforming high-end consumer, while [McDonald's (MCD)] is over-indexed to a still very-stressed low end consumer," the note said.

Starbucks is also "in a unique position to benefit from growing preferences for higher quality foods, as it has made (and continues to make) significant investments in convenience, while also expanding the variety of fast-casual quality products it can offer with QSR-style convenience," Holthouse writes. "MCD sits squarely on the other side of this change in behavior."

Even though I don't even drink coffee, my trips to Starbucks are not that often. I still visit them for a number of reasons: the tea and the lemon loaf, but that's not at all. Besides delicious baked goods, one of the main reasons I visit them, is for their convenience. Starbucks' are virtually everywhere, whereas Dunkin' Donuts (DNKN) is not, at least in my experience.

And now with the company focusing more on Teavana, I'm sure Starbucks will get more of my dollars.

--Written by Laurie Kulikowski in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
2 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,085.28 +55.07 0.31%
S&P 500 2,091.92 +10.04 0.48%
NASDAQ 4,810.15 +36.6780 0.77%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs