How Will Starbucks (SBUX) Stock Be Affected By New Price Increases?

NEW YORK (TheStreet) -- Shares of Starbucks Corp.  (SBUX) are down -0.92% to $76.52 on heavy trading volume after it was reported that the company will raise prices for certain packaged coffee and other products, responding to a spike in raw coffee costs earlier this year that is now making its way to consumers, the Wall Street Journal reports.

Starting Tuesday, some beverages in Starbucks company-operated stores will increase by five cents to 20 cents. Price increases on the beverages in its stores will increase the average ticket by less than 1%, Starbucks said.

The list prices of Starbucks packaged coffee sold in grocery stores will increase by an average of 8% on July 21, the Journal noted.

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TheStreet Ratings team rates STARBUCKS CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate STARBUCKS CORP (SBUX) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."

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