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LivestreamMenuStarbucks ‘ turnaround is moving from promise to proof. That was Jim Cramer’s takeaway Thursday after interviewing Starbucks CEO Brian Niccol Thursday, a day after the coffee giant delivered another strong quarter and raised its fiscal 2026 outlook. In response, we raised our price target to $120 a share from $115. The quarter looked like “the inflection,” Jim said Thursday on CNBC, which should help the stock “say goodbye to this $100 [level] and take it to a much higher level.” Shares rose more than 3% on Thursday, to about $107 apiece. Year to date, Starbucks is up about 26%. It set a 52-week closing high of $108.37 on July 16. The stock hasn’t traded above $110 since January 2025. The results offered more evidence that Niccol’s “Back to Starbucks” strategy is gaining traction. The company delivered its fourth consecutive quarter of global comparable store sales gains and raised guidance across the board for the second straight quarter. Profitability also showed meaningful improvement, with North America margins expanding for the first time in more than two years, even when excluding benefits from tariff refunds. Speaking with Jim on Thursday, Niccol said the quarter’s comparable sales growth was driven by higher transactions, customers adding more drink customizations, and a stronger lean toward food — signs that Starbucks is improving traffic and spending per visit. Comparable sales measures the performance of locations open for at least 13 months. It’s a key metric for restaurant investors. Niccol said the company is seeing customers respond to the “operational discipline” and “consistent execution” that its stores are delivering. A key part of that strategy has been Starbucks’ store refresh initiative. Niccol said the company has completed upgrades at a little more than 1,000 locations so far, but he sees an opportunity to eventually retrofit as many as 8,000 stores. “Once we remodel the front of house or do the uplift, we quickly see customers trying to respond in actually ever access point,” Niccol said, pointing to improvements across drive-thru, mobile order pick up, and delivery. Customers “just feel better about the coffeehouse and ultimately they feel better about the Starbucks brand,” Niccol added. Longer term, Niccol said Seattle-based Starbucks is also simplifying its operating model internationally, with greater emphasis on licensing outside of North America while maintaining direct control of U.S. and Canada operations. In April, Starbucks finalized a joint venture for its business in China. As a result, about 90% of the company’s nearly 23,000 international locations are now managed through a licensed structure. “Over time what we’re going to find is we will be a licensor globally and then we’ll be running company operations here in North America,” Niccol said. For the Investing Club, the quarter reinforced our confidence that Starbucks’ top-line turnaround is now translating into healthier profits, justifying continued investment in stores, staffing and operations. “There are so many good things ahead here,” Jim said, reiterating that the stock is prepped to “break out of the range.” (Jim Cramer’s Charitable Trust is long SBUX. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.Read More
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