Starbucks Corp. (NASDAQ: SBUX) posted good numbers for its most recent quarter. They were not, however, strong enough to support any improvement in its stock. While the coffee company’s numbers are comfortably good, Starbucks is no longer a growth stock. Either its own operations are capping growth or some outside forces are. The most likely of those forces is McDonald’s Corp. (NYSE: MCD), which continues to have impressive results from it breakfast efforts.
Starbucks’ comparable store sales rose 2% worldwide in the quarter that ended April 1, and U.S. sales rose by the same amount. Starbucks management reported this was due to a 3% increase in ticket price, or what each person who comes to one of its stores spends. Without this improvement in what customers spend, Starbucks sales would have been flat, at best. Starbucks is no longer opening stores quickly. It only added a net 170 in the most recent quarter. In its Americas business, revenue rose only 8% to $4 billion. Operating income, which is used to measure divisional profits, dropped 3% to $802 million for the region.
After a fallow period of growth, McDonald’s has hit its growth stride again. Most experts say this is due to two factors, beyond menu items, that are attractive. One is the strength of breakfast sales. The other is the number of stores McDonald’s keeps open for 24 hours a day.
Breakfast is likely where McDonald’s is hitting Starbucks the hardest. While Starbucks has built an all-day menu, it is still basically a coffee store. And Starbucks has few, if any, locations that are open 24 hours a day. McDonald’s draws customers for lunch and dinner. It is a more complete fast-food restaurant in both menu selection and accessibility.
Are Starbucks’ growth days behind it? In the United States, the answer most likely is yes. At least part of this is due to the fact that McDonald’s has broken into Starbucks’ business territory and won’t leave.
100 Million Americans Are Missing This Crucial Retirement Tool
The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.
Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.
A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.
Click here to learn how to get a quote in just a few minutes.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
