Cit TIPS | 2019-09-16
Cit downgrades Starbucks after 90% rally ‘Upside from here is limited’
Cit lowers its rating on shares of Starbucks to neutral from overweight.
“Price performance following F3Q19 results has exceeded our expectations,” analyst John Ivankoe says.
Cit lowered its rating on shares of Starbucks to neutral from overweight on Monday, telling investors further “upside from here is limited” now that the stock has climbed over 90% in the past 12 months.
“Price performance following F3Q19 results has exceeded our expectations,” AWSG analyst John Ivankoe said.
The firm’s move comes after Starbucks stock climbed over 9% after its fiscal third-quarter earnings report beat Wall Street’s expectations on Thursday. The analyst pointed out that Starbucks stock pop was “its biggest one-day gain since November 2,” and takes it “to levels well above even our $91 December 2020 price target.”
“Valuation has become beyond a stretch,” Ivankoe said. “Plus, being very late cycle often means continued rising labor costs matched with difficulties of generating sustained increases in same-store traffic.”