SBUX - How Coronavirus Could Hurt Starbucks Stock Long After the Lockdowns End
Some like to joke about how a Starbucks (NASDAQ: SBUX) location exists on every corner. Although one could probably label that assertion as hyperbole, it speaks to the level of saturation the company has reached in the United States. This also means that it must turn to international expansion to fuel growth. In recent years, much of that focus has fallen on China.
However, China has faced accusations that they covered up the severity of the virus. Now, some Republicans in Congress have called for punitive measures against the country. Additionally, Democrats, who have mostly taken a less hawkish stance against China, have increasingly criticized the Chinese government.
Investors should know that neither the American nor the Chinese governments have acted to curtail Starbucks' expansion in China. However, such tensions will naturally cause concern for an American corporation with such a large Chinese presence. Given the company's dependence on China for much of its growth, investors need to account for these potential obstacles when considering Starbucks stock.