Starbucks Corp (NASDAQ:SBUX) stock rose 0.11% (As on March 25, 11:36:07 AM UTC-4, Source: Google Finance) after Argus upgraded it to Buy from Hold, calling the recent stock dip a great buying opportunity. Analysts believe the coffee giant’s digital focus, branding, and store remodelling efforts will boost traffic and same-store sales, setting a price target of $115. The firm thinks the recent sell-off has created a buying opportunity because investors have ramped up their fears about faltering same-store sales across the restaurant sector due to the weakening economy. Analyst John Staszak said Starbucks’ emphasis on digital improvements, brand marketing, and fewer sales promotions looks promising.

The firm’s expectation is that Starbucks’ menu simplification and store remodeling efforts will likely lead to increased customer traffic and improved same-store sales growth. Staszak boosted his FY25 EPS on Starbucks to $3.18 and sees FY26 EPS of $3.80. Based on an above-average dividend yield, the company’s solid prospects, and the ending of its share buyback program in favor of unit expansion, Argus also set a long-term Buy rating on Starbuck. The Wall Street analyst ratings scorecard on SBUX shows 17 Buy-equivalent ratings stacking up against 14 Hold-equivalent ratings and 4 Sell-equivalent ratings. Argus assigned a price target of $115 to SBUX.

Meanwhile, Starbucks plans to lay off 1,100 corporate employees globally as new chairman and CEO Brian Niccol streamlines operations. Mr Niccol said Starbucks is also eliminating several hundred open and unfilled positions. Starbucks has 16,000 corporate support employees worldwide, but that includes some employees who are not impacted, like roasting and warehouse staff. The company’s stores are not included in the layoffs.

Starbucks hired Mr Niccol last autumn to turn around sluggish sales. He has said he wants to improve service times — especially during the morning rush — and re-establish stores as community gathering places. Mr Niccol is also cutting items from Starbucks’ menu and experimenting with its ordering algorithms to better handle its mix of mobile, drive-thru and in-store orders. Starbucks’ global same-store sales, or sales at locations open at least a year, fell 2% in its 2024 fiscal year, which ended September 29. In the US, customers tired of price increases and growing wait times. In China, its second-largest market, Starbucks faced growing competition from cheaper rivals. Starbucks had reported fiscal first-quarter net income attributable to the company of $780.8 million, or 69 cents per share, down from $1.02 billion, or 90 cents per share, a year earlier.