SBUX - Why Investors Were Fired Up About Starbucks Stock Today
2024-07-19 18:25:33 ET
It seems that Starbucks (NASDAQ: SBUX) will soon have an activist investor within its ranks advocating for change. Several media reports have said that a well-known activist investment firm has amassed a stake in the popular coffee shop chain operator. On Friday, investors greeted this news by trading up the company's stock by nearly 7%. That performance was miles better than that of the S&P 500 index, which fell by 0.7% on the day.
The Wall Street Journal broke the story on Friday. Citing unidentified "people familiar with the matter," the financial newspaper said that Elliott Investment Management has built up a "sizable" stake in Starbucks. It added that it could not determine how large a position this might be, or if Elliott was also aiming to secure seats on the board of directors.
In recent weeks Elliott, which has a long history dotted with some successes as an activist investor , has been agitating for Starbucks management to devise ways of boosting its stock price, the Journal wrote. Although the company's stores are durably popular, we can't say the same for its shares lately, which have declined more than 17% year to date and by 21% over the past 12 months.
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Why Investors Were Fired Up About Starbucks Stock Today