10:25 AM EDT, 07/09/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Shares of SBUX traded 3% higher in premarket following reports the company's China business attracted offers for a potential stake sale, valuing the unit up to $10 billion. The bidders include both Asia-based private equity firms and U.S. peers, including Carlyle Group and KKR & Co. Although the transaction represents potential positives, including capital redeployment, local partnership leverage, and better margin profile, we view a stake sale as a strategic retreat from growth in one of its most promising expansion markets. Shares of SBUX currently trade at 32x FY 26 EPS, a 30% premium to its 25x median forward P/E since 2021. This suggests to us that risks skew to the downside, especially with FQ3 2025 (Jun-Q) results looming, and the company yet to provide financial guidance since suspending its outlook in FQ4 2024 (Sep-Q). We reiterate our Sell rating, keeping our 12-month target price at $65, 26x our FY 26 EPS estimate. Our EPS estimates are unchanged, with FY 25 at $2.46 and FY 26 at $2.48.