NEW YORK (TheStreet) -- Shares of Starbucks Corp. (SBUX) are slightly higher in pre-market trade after it was reported that the coffee shop chain agreed to buy the remaining 61% of its Japanese operations for about $913.5 million, Bloomberg reports.
The deal will include buying a 40% stake from Sazaby League for about $505 million and the 21% owned by public shareholders for about $408.5 million, the company said in a statement.
Starbucks, which gets over 6% of revenue from its Asia unit, recently acquired the Teavana tea company and Bay Bread bakery to help attract customers with non-coffee items, Bloomberg noted. In Japan, ready-to-drink beverages are profitable and selling well, presenting a strong opportunity for Starbucks, CFO Scott Maw said at an investor conference in June.
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, growth in earnings per share and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."