Why Starbucks Could Continue to Struggle in the Bear Market
There are some stocks that look to be good investments to hang on to amid a downturn and inflation. Starbucks (NASDAQ: SBUX) doesn't strike me as one of those stocks. Year to date, it has fallen 27%, proving to be a worse buy than the S&P 500, which is down just 13%.
But as bad as things have been for the business, I wouldn't be surprised if they get even worse. Here's why this could be a bad stock to be holding in this challenging market.
Starbucks released its third-quarter numbers earlier this month, for the period ended July 3; sales rose by a modest 9% year over year to $8.2 billion. What's particularly telling is that global comparable-store sales rose 3%, and that was mainly due to a higher average ticket (which was up 6% while comparable transactions declined by 3%). Starbucks has raised its prices multiple times since October due to rising inflation.
Source Fool.com
