Investors who bought stocks during the COVID-19 market crash in 2020 have generally experienced some big gains in the last two years. But there is no question some big-name stocks performed better than others since the pandemic bottom.
Starbucks' Bumpy Ride: One company that has been a disappointing investment in the past two years has been coffee giant Starbucks Corporation (NASDAQ:SBUX).
The restaurant industry was hit hard by the COVID-19 pandemic in 2020. Fortunately for Starbucks investors, the company was relatively well-positioned to weather the storm.
The pandemic negatively impacted higher-end fine dining and casual dining restaurants more than quick-service restaurants. Starbucks also had a head start on competitors with its digital sales infrastructure and its drive-thru services.
At the beginning of 2020, Starbucks shares were trading at around $88. By the beginning of March, the stock was down to $77.92 as news of the coronavirus spreading in China prompted concerns about a U.S. pandemic.
Starbucks bottomed at $50.02 during the pandemic-driven March sell-off. Fortunately for Starbucks investors, the dip did not last long.
By December, Starbucks shares were back at new all-time highs above $100, and the stock got as high as $126.32 in July 2021 prior to an extended consolidation period.
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Starbucks In 2022, Beyond: In the fiscal fourth quarter, Starbucks reported a 12% growth in same-store sales in the U.S. and a 23% drop in same-store sales in China, the company’s two largest global markets.
In addition, the company reported 17% growth in active memberships in its loyalty program, which now has 26.7 million members.
Unfortunately, Starbucks shares have now drifted all the way back down to around $72.
Still, investors who bought Starbucks on the day it hit its 2020 pandemic low and held on have generated a positive return on their investment. In fact, $1,000 in Starbucks stock bought on March 18, 2020, would be worth about $1,328 today, assuming reinvested dividends.
Looking ahead, analysts are expecting Starbucks stock to rebound in the next 12 months. The average price target among the 27 analysts covering the stock is $94, suggesting 31.4% upside from current levels.
