Selling Stake In China Business Could Make Sense For Starbucks -- Market Talk

Dow Jones03:14

1414 ET - Starbucks is considering selling a stake in its Chinese business, Bloomberg reported. This move isn't surprising, as the coffee chain has been signaling a willingness to evaluate options in China, Baird analysts say in a research note. A sale could help to lower Starbucks' risk profile, creating a more capital-efficient growth model going forward and boosting investor sentiment, the analysts say. "Even though China may represent a significant long-term growth opportunity for the Starbucks brand, the ongoing uncertainties and volatility tied to operating in this market have led us to believe a licensing/joint-venture model could make the most sense for SBUX going forward," they write. Starbucks is up 2%, and up 6% year-to-date. (connor.hart@wsj.com)

(END) Dow Jones Newswires

November 22, 2024 14:14 ET (19:14 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment